The baby care category declined 25 percent in the BrandZÔ Top 100 Most Valuable Chinese Brands because of the performance of diaper maker Anerle, the only baby care brand in the ranking.
The market for disposable diapers remains strong in China, driven by the affluence of the expanding middle class and its desire for convenience. However, the market is also becoming more competitive. E-commerce has provided easier access for brands, particularly from overseas, and it has stoked fierce price competition for mid-market products, although a premium niche continues to flourish.
The recently imposed tariff on e-commerce imports should strengthen the position of Anerle, a domestic brand produced by a Hengan International Group Company, Ltd. Long-term, growth prospects for the diaper business are positive because disposable diapers are an urban phenomenon in China and penetration is low countrywide. In addition, the rescinding of the two-child policy should increase demand across the baby care category.