In emerging markets, the value of turning baby wipes from dispensable into indispensable would be hugely significant, not least because the category's highest value-developed markets are aging, with slow birth rates. It is relevant to consider, for example, that of the top 20 forecast growth markets for diapers – in absolute terms (meaning actual additional value) – these markets should be ripe terrain for new baby wipes business.
Quite simply, both the demographics and the economics are more favorable in Latin America, Asia-Pacific and the Middle East/Africa than in either Europe or North America. And these macro variables are made all the more compelling by the category’s actual value opportunity. The disparity between the UK and Mexico bears this out. Specifically, provisional data for 2010 shows that the baby wipes category is worth around $340 million in the UK, some 17 times higher than in Mexico. Yet, Mexico's baby population (aged 0-4 years) is more than two and a half times larger.
On-shelf competition is fierce in the baby wipes market.
Globally, the baby wipes retail market is worth about $3.7 billion a year, compared with more than of $31 billion for diapers. That gap needs to be narrower. For example, if the diapers and baby wipes categories in the US are used as a benchmark, the global baby wipes market should be worth something closer to $6 billion. The current shortfall is almost certainly arising from underperformance in emerging markets. As 2011 takes shape, there has, arguably, never been a better opportunity to do something about it. The dominant diapers players have formidable emerging market momentum on their side, but surely it is time to develop a more effective, revamped strategic approach for their baby wipes.