Kao Corp. has reportedly started selling its Merries diapers in India, looking to replicate the same success it had in the Chinese market. With more than 25 million babies born per year, India is a large and fast growing market for diapers.
Kao’s Merries brand generates more than ¥10 billion in sales annually and is the leading premium diaper brand in Japan.
Procter & Gamble’s Pampers brand currently is the leading brand in India but it has been challenged by Unicharm in recent years. The Japanese company’s Mamy Poko brand has seen as much as 30% growth in diapers, allowing it to narrow Pampers' lead in the market.
Kao is betting on some Indian consumers having the same taste for premium diapers as its Chinese counterparts. Kao was one of the first companies to launch a premium diaper in China after it noticed Chinese tourists to Japan buying them in bulk.
A single Merries diaper costs two to three times that of a Unicharm diaper manufactured locally, as Kao exports such products from Japan to India. Kao hopes to capitalize on Merries's reputation for being gentle to the skin, which is highly valued in many countries.
The Indian diaper industry is currently pegged at about 4.6 billion pieces or $800 million. The industry is expected to grow to about 10 billion pieces or $1400 million by 2022. Increasing birth rates, higher disposable incomes, increased hygiene awareness and a radical increase in the number of working women are factors driving this market growth.