ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Business

US company sees disposables as new revenue engine

Pampers diapers from Proctor & Gamble are sold alongside rival Huggies products from Kimberly-Clark at a store in the U.S.

NEW YORK -- U.S. consumer-goods company Proctor & Gamble has seen the future, and it is swaddled in diapers. Specifically, disposable ones.

     The global market for single-use baby diapers is swelling along with emerging economies. It was valued at $44.3 billion in 2014, up 7% from 2012. Sensing an opportunity, P&G is pumping more resources into this segment, hoping to make up for the hit it has taken from a maturing cosmetics market and a strong dollar.

     An analyst at U.S. asset management company AllianceBernstein said disposable diapers are "one of the few growing markets among consumer goods." The analyst said rising incomes in emerging economies mean more consumers are placing quality over price.

     Since autumn 2014, P&G has launched new products of disposable baby diapers in Brazil, Russia, India, and China. In addition to offering diapers that are taped at the sides, the company is bolstering sales of pull-on diapers, an area in which its Japanese rivals gained an earlier edge in development and marketing.

Product overhaul     

Touting new products designed to be soft and easy to use, P&G is launching a marketing offensive in China in 2015. A big goal is to expand sales in Asia and Latin America.

     In 2013, the company made changes to its mainstay Pampers line of disposable diapers that it claims significantly improved the absorbency and texture. Over 10% of the company's sales come from Pampers.

     After the change, Pampers developed a reputation in the North American market as a high-quality, if more expensive, brand. The move paid off: In 2014, Pampers ate into the North American market share of U.S. competitor Kimberly-Clark, the company behind the Huggies brand.

     At a consumer goods industry conference in Florida on Feb. 19,  P&G CEO Alan Lafley said that capturing a solid share of the global diaper pants market could translate into a sales increase of $2 billion.

     The company is also aiming for growth in adult diapers and products for mild incontinence. In summer 2014, P&G re-entered those segments in the U.S. and Europe. The outlook for those products is bright due to the aging global population and profitability per unit compared with diapers for babies.

     Currently, the market for goods aimed at adults is dominated by major Swedish hygiene product maker Svenska Cellulosa, Kimberly-Clark and Japan's Unicharm. But P&G is determined to increase its share under its latest offensive.

 

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends July 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more