Nigeria baby diapers market booms on annual 5.9m births

By the time you finish reading this article, about 35 newborns would have been added to Nigeria’s population, swelling the baby diapers market size by another 35. The United Nations Children Emergency Fund estimates annual childbirth in Nigeria at 5.9 million.

The global baby diapers market is expected to reach USD 64.62 billion by 2022, according to a new report by Grand View Research, Inc. Increasing disposable income level coupled with increasing birth rates particularly in emerging markets is expected to remain a key driving factor for global baby diapers market.

On the average, Nigerian women bear up to five children over the course of their reproductive lives, making Nigeria one of the largest emerging markets for baby diapers.

According to Euromonitor, a market intelligence firm, nappies, diapers pants in Nigeria saw volume growth of 6 percent and current value growth of 16 percent in 2015. While this growth is driven by the increase in urban populations (who are more likely to use such products than rural residents), the increase in women in formal working environments, and a growing baby population, growth in 2015 was also supported by marketing activities and the increased visibility of a wide range of brands.

From only one dominant brand about 15 years ago (Pampers), there are now numerous brands on offer in Nigeria. Sales of nappies, diapers, pants in Nigeria are also very low in per capita terms, with a usage of only 60 units per child per year compared to 1, 204 in North America and 959 in Western Europe. This means it is a developing category with strong growth prospects.

Procter & Gamble Nigeria Ltd commands a strong lead in nappies, diapers, pants, with a value share of 43 percent in 2015. This is due to the popularity of its Pampers brand, which enjoys national distribution as well as a strong reputation among consumers. It is also well supported by national advertising in both print and electronic media, as well as new launches.

Nappies, diapers, and pants are expected to see a strong performance in value terms over the next 10 years with a compound annual growth rate (CAGR) of 7 percent at constant 2016 prices. Growth in the baby population, as well as in the middle-income population, and rising brand awareness will help drive growth over the forecast period.

Major international brands by Procter & Gamble and Kimberly-Clark continue to cater to the needs of the rising middle and upper earners with higher disposable incomes and launch higher quality products, such as late 2014 entries by Pampers Baby Dry and Huggies Pure and Natural. At the same time, Kimberly-Clark is joining Procter & Gamble in expanding local production, which might help also to take advantage of lower tariffs on imported raw materials, thereby reducing the costs and offering high quality products at competitive prices.

In volume terms, nappies, diapers, pants are expected to grow at a CAGR of 7 percent, to reach 2,070 million units by 2020. If the infrastructure supporting local production is improved, particularly the electricity supply, and if import tariffs are not lowered to favour imported brands, local players will be much more capable of competing and providing lower-priced and better-quality products, helping to improve competition and demand.

Baby product businesses in Nigeria in general and the baby diapers market are booming because both birth and fertility rates in Africa’s most populous nation are rising rapidly at 35 per 1000 live birth per annum.

Growing awareness regarding baby’s health and novel products resulting from technological advances are other critical factors that are presumed to positively impact the baby diaper market over the next decade. Increasing working women ratio is another key factor that is expected to aid the market over the next seven years.

‘Birth rate’ refers to the number of live births in an area (like Nigeria) for every 1,000 people in a year and ‘fertility rate’ is the average number of children born to one woman over the course of her life, both figures are high Nigeria. The average birth rate in sub-Saharan Africa currently stands at 35 babies per 1, 000 Africans. This figure approaches 25 million babies born every year in Africa of these, 24 percent are born in Nigeria.

STEPHEN ONYEKWELU