In 2003, Euromonitor found that the UK wipes market grew by 12 per cent in value terms, making wipes the most dynamic sector in the disposable paper products market. Within this sector, household wipes led the way in terms of value growth, with an increase of 18 per cent, while personal wipes followed, with a value increase of 10 per cent.
However, it is the personal wipes segment that will continue to be by far the major force in this category, with the growth of wipes for cosmetic purposes carving out a growing niche.
In 2003 the total wipes market was valued at £333.2 million (€478.46m). Although baby wipes still represent 52 per cent of this figure, falling birth rates and increasingly competitive private label products mean that the segment is now declining in market share.
Just six years ago, baby wipes constituted 82 per cent of the market for personal wipes, while cosmetic wipes represented just 4 per cent of the market. Euromonitor estimates that by the year 2003 this figure had slipped to 65 per cent for baby wipes and 20 per cent for cosmetic wipes.
But despite this, the market for baby wipes is still vibrant. Baby wipes proved to be a leading area for new product development, showing a 10 per cent growth in value between 2002 and 2003. Growth in this sector was driven by brand extensions, as manufacturers developed new variations of successful brands in order to boost sales.
Big product launches in 2002 included Kimberly-Clark's introduction of a baby wipe variant of its Huggies nappy brand. This allowed the company to continue to generate healthy sales right through 2003. The other two leading brands also launched extensions. Johnson & Johnson spent £5 million launching an aloe vera variant of its existing wipes in order to capitalise on the fad for aloe vera, while Procter & Gamble launched Pampers Kandoo with the aim of extending usage of Pampers wipes by creating a specific product that targets slightly older children who are at potty training stage.
On the other hand, and despite a number of high profile launches from the likes of Beiersdorf and Carter Products, deodorant wipes struggled to live up to expectations in 2003. Instead of being used as part of the regular cleansing regime in the morning, they tend to be used during the day and evening as a temporary measure to freshen up. Consequently, wipes are seen as a seasonal type of deodorant, used particularly at times of significant social activity, particularly in the summer and to a lesser extent at Christmas, making sales inconsistent.
With manufacturers unlikely to be able to uphold the same level of product innovation in the future, growth in wipes will begin to slow down in the next few years. Euromonitor forecasts that between 2003 and 2008, wipes will see a slower constant value growth of approximately 3.3 per cent per year - a significant decline when compared to the 1997-2003 period, which registered a CAGR of 23.5 per cent.
Yanina Aubrey, head of disposable paper products research at Euromonitor, commented: "Manufacturers will clearly find it hard to sustain the current level of new product development. As a result, they will have to find other ways to maintain and increase sales. We expect to see manufactures continuing to strive to find new ways of generating value, such as increasing product segmentation through texture enhancements, increased variation in terms of fragances and other properties, and the introduction of new task-specific applications and devices.
"As the sector matures and competition among brands (including own-labels) intensifies, manufacturers will be forced to engage in more aggressive price promotional activity that will force prices and consequently value sales down. Nevertheless, in the medium term manufacturers should continue to benefit from what continues to be a dynamic and highly innovative sector."
At the global level, the stronger growth rates for this category are likely to be generated by emerging regions, which will see growth from lower consumer bases, whilst value sales in western Europe and, particularly, North America are likely to be hampered by price pressures. The large US market is also looking to see a more sluggish value performance.