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Big Potential in Tiny Consumers

By: Carrie Lennard, Euromonitor International
Posted: August 3, 2010, from the August 2010 issue of GCI Magazine.

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Despite the economic downturn in 2009, the increase in the number of middle-income consumers resulted in strong sales of value-added products, and strong growth for products that consumers previously could not afford as an everyday purchase—baby and child-specific sun care, for example, registered excellent growth of 15% in 2009.

Natural/Organic Sales on the Rise

Natural and organic baby care products continued to be a significant trend in 2009 in regions where available. Many consumers start buying organic baby care products when they first become parents, deeming these product to be “best” for their children, and thereafter are unwilling to trade down from products that are perceived as being of a high quality.

As they start reading labels on foods for their children, consumers are more inclined to read labels on baby care products too, being on the lookout for preservatives such as parabens and other additives. The fear of common beauty ingredients such as PEG (propylene glycol) and sodium laureth sulfate has sent parents flocking to the emerging natural and organic baby care segment.

The key markets for organic and naturally positioned baby care products are affluent regions such as Western Europe and the U.S., primarily due to the often high price points of organic brands. Germany is the most mature market for natural baby care products, with many of the biggest names in natural beauty, such as Lavera and Weleda, originating from the country. These brands are becoming increasingly popular abroad, and German natural product manufacturers are focusing on expanding sales in other European countries, notably France and the U.K.

Popularity of Natural Sets/Kits Takes Off

Natural baby care starter kits are now often given as presents to expectant mothers as the popularity of baby showers held by mothers-to-be spreads beyond the U.S. into other countries. Products such as the “Getting Started” kit or the “Baby Bee Bundle of Joy Basket” from natural beauty stalwart Burt’s Bees and the “Mom and Baby Set” from Lavera are being sold as gifts for mothers and babies, the idea being that new mothers will then become regular purchasers of these brands once the trial-sized bottles in the kit run out.

No Major Inroads for Private Label