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Gender specific diapers, compressed packaging mark private label diaper trends.

Gender Specific Diapers, Compressed Packaging Mark Private Label Diaper Trends

While manufacturers of private label and store brand diapers held off during 1990 and resisted putting gender specific products on the shelves until late in the year, the commitment to boy/girl diapers is spurring them into 1991. As a result, gender specific diapers will represent 90% of total private label diaper sales by the end of 1991, according to a recent report by Private Label magazine.

"The vast majority of retailers have either already converted their private label unisex ultras to Boy/Girl or are in the process of doing so," said the Private Label report.

The second major trend for private label diapers also mirrors brand name innovations. Compressed packaging is making its way into the private label sector and most private label retailers are expected to convert early this year. Because retailers were forced to double their stock keeping units (SKUs) due to the need to offer both types of diapers, the compressed packaging is a direct result of the popularity of gender specific diapers and their demand on limited shelf space.

In terms of features, inner leg gathers are quickly becoming standard on private label diapers. The innovation, which provides a leakage control barrier around the legs, is also a reflection of diaper changes by Procter & Gamble's "Pampers" and Kimberly-Clark's "Huggies" branded products.

Another feature that has raised some interest among private labels, but has not grown as quickly as expected, is the trend toward superabsorbent diapers. Only 65% of store brands sales are of superabsorbent products, up from 55% a year ago, while 100% of name brand diapers incorporate this technology. It is expected, however, that by the end of 1991 more than 90% of private label sales will be of superabsorbent diapers as private label technology catches up to consumer demand.

A move by the national brands that is not being planned currently but is very possible in the not-too-distant future by store brands is the reduction of standard counts in diaper packages. During the first quarter of 1991, Pampers and Luvs will reduce their standard to 54-count smalls, 40-count mediums, 30-count large and 26-count extra. K-C's Huggies are expected to follow suit shortly afterwards. Most retailers are waiting until all three major brands have reduced their counts because, says Private Label, "the primary reason behind the national brand count reductions is to avoid a price increase that would put them over the magic $10 level."

Sales Stable, Increases Expected

Private and control label diaper prices remained stable last year, allowing them to maintain their 17% market share in units. Total disposable diaper unit sales declined 1.6%, however, with dollar volume remaining the same at $3.5 billion. The decline is attributed to better quality diapers, resulting in the daily use of less diapers - a drop from 7.3 in 1986 to 6.7 in 1990.

In the next year, however, store brand sales are expected to increase dramatically, the Private Label survey projected. More than 90% of retailers are predicting gains and the average increase is set at 10%. Among the reasons cited are "decreased promotions and couponing by the national brands, a continuing bad economy (private labels usually thrive during recessions), but, most of all, the fact that for most of 1991 private label will be able to compete head to head with the brands in terms of gender specific design, compressed packs and inner leg gathers."

Also noted was that despite selling for 20-30% less than branded counterparts, store brand diapers tend to carry profit margins of 10-20%, as opposed to 3% for national brands.

Finally, although total U.S. births held steady at 3.7 million annually, a decline to 3.4 million is expected by the year 2000. This means a more competitive disposable diaper industry competing for a declining customer base can be expected in the future.
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Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Author:Noonan, Ellen
Publication:Nonwovens Industry
Date:Mar 1, 1991
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