Mumbai: Kimberly-Clark Corp., the maker of Huggies diapers, is keen on expanding its presence in the estimated Rs.1,200 crore Indian baby care market, but this is no easy task in a country where parents prefer to wrap their baby’s skin in soft muslin cloth and use a diaper only when going outdoors or travelling.
Achal Agarwal, Kimberly-Clark International’s Asia-Pacific president, wants to change this by sharpening the company’s focus on the Indian “mom”.
“We have got feedback from mothers that they want baby skin to be healthy and have introduced breathable covers,” Agarwal said in an interview on 14 October.
Kimberly-Clark is present in India as Kimberly-Clark Lever Pvt. Ltd—a joint venture with India’s largest consumer packaged goods company by sales Hindustan Unilever Ltd. Despite being in the country for nearly two decades, the joint venture has been unable to expand the market for brands such as Huggies and Kotex for feminine hygiene.
The company also does not sell its other brands such as Depend, an adult care brand, Cottonelle and Kleenex—its tissue paper brands—in India. “Our focus is going to be on baby and child care, fem (feminine) care and at some point adult care...we believe in the power of focus...We will not bring tissue paper here,” said Agarwal, who hopes the Asia-Pacific region will generate $10 billion in revenue for Kimberly-Clark by 2020.
“India, by then, could be a billion dollar business,” he added.
With India currently accounting for less than 1% of the company’s overall revenue, however, Agarwal has his task cut out for him.
Kimberly-Clark has a 70% share of the diaper market in Korea, says Agarwal as the company worked on an insight of getting the right fit diaper for Asian babies, who were smaller in size than American babies.
In India, though, the diapers market is less than one-eighth the size of the China market, estimated to be $4 billion.
This despite the fact that there are 25 million babies born per annum in India compared with 15 million babies born per annum in China, said Agarwal.
“There is a question of affordability and relevance. The Indian diaper market is even smaller than the Australian diaper market, despite being 70 times their size,” said Abheek Singhi, leader, consumer practice India, partner and director at the Boston Consulting Group, a consultancy firm.
Agarwal claimed that in India, Huggies is the second largest brand in the diapers category and Kotex, the third largest in the feminine hygiene segment.
The childcare and feminine care categories comprise brands from multinationals such as Procter and Gamble Co., whose brands Pampers and Whisper are popular in the baby care and feminine care categories, respectively.
The diaper market in India is currently (October, 2013) estimated at Rs.1,200 crore, and is growing at a rate of 30% per annum, according to market research company Nielsen. Likewise, the feminine care category in India is a Rs.1,800 crore segment and growing at a rate of 21% per annum, according to Nielsen.
The Nielsen numbers were shared by Kimberly-Clark, but could not be independently verified by the market research firm.