as published by GfK in March/April 2024 Progressive Preschool
After a gradual improvement in consumer confidence towards the end of the 2023, GfK’s long running Consumer Confidence Index reported a two-point drop in February versus January, bringing it to -21. Although negative, this is far better than the -38 recorded the same time a year ago. Consumers are feeling far more positive about their personal financial situation over the next 12 months. For the Baby Care market, consumer confidence is important – but of course, so is the birth rate. This has been steadily declining in England and Wales for the last few years and looks set to continue.
How was 2023?
The full year 2023 saw the Baby Care market stable in terms of value but in decline by volume, reflecting birth rate trends. In value terms, the market was up 1% compared to 2022. Strollers were the biggest contributor as they continued to recover from the impact of the pandemic. Sales ended the year at +6% versus 2022. Baby Bottles also saw a positive value as +5%. Car Seats remained stable at +1%.
However, volume in 2023 was down 11% compared to 2022. All areas within Baby Care saw declines except strollers. Both online and in-store saw small value growth over 2023, and both posted volume declines, with the drop for in-store more significant – down 12% compared to 2022. However, in store remains the popular channel when it comes to volume.
GfK’s data also shows that the amount purchased with a discount increased back to 2018/ 2019 levels. This reflects the impact of the cost-of-living crisis as some consumers waited for a discount to buy.
How is 2024 looking?
So far January 2024 data is tracking at the trend identified in 2023, as value is up 1% whilst volume is down 8%. However, the biggest difference seen so far this year is that stroller volume growth is -3% which could signal the end of the recovery period for this market segment. Online value fell 2% in January when compared with the same period in 2023. In store trends continued similarly to 2023.
For January 2024, volume at sales brought on promotion is similar to trends reported in 2023, returning to pre COVID levels for most product areas.
One trend on the rise is polarisation, meaning that during recessions and the cost-of-living crises, consumers either by the most affordable product possible or save to buy a premium product. Across most product areas in Baby Care this trend is continuing. However, consumers are moving away from the super-premium end of the market (where prices are 200% of the average price) to the premium end (130% – 200% of the average price). The more affordable area also continues to grow (50% of the average price).
Outlook for 2024
2024 will likely be another area of decline in the Baby Care market. Manufacturers will need to ensure their product launches succeed by introducing innovations that truly resonate with consumers’ needs and wants. For those focusing on sustainability, having clear messaging and providing affordable solutions will help attract a larger and younger consumer base.
We are grateful to GfK for this research.
