A Look at the UK Market

HIGH-END PRODUCTS ARE KEY

In the middle of 2018, the UK economy improved slightly, compared to the second half of last year. This environment has helped the recovery of many categories across both small and major domestic appliances.

While of course affected by this, the success of the babycare market also correlates to other aspects of the market. - such as the UK's declining birth rate - a factor that is affecting sales across many segments.

This is certainly the case for the stroller market, where volume sales have declined by 5% over the last 12mths. Car seats have also suffered, showing almost double digit decline at 9%. the total mobility market value (strollers and car seats combined) is £447m, with an overall volume decrease of 8%. This is set against the rest of the nursery market which saw turnover grow by 3%, driven by an average price increase of 12%

Within the stroller category, the buggy segment (defined as suitable for second stage only as the child is transported in an upright position), accounts for almost half of volume and is seeing a slight decline both in volume and value compared to 2017. On the other side, the travel system category has seen a remarkable growth in value, led by the 'compatible' and 'two-in-one'  models, growing by 8% and 14% respectively.

The average price for compatible travel systems increased by 24%, rising to £340. This is an increase of £66 year-on-year as consumers are choosing to trade up to more premium models. The average price paid for a two-in-one model is £477 - a growth of almost £40 compared to last year.

A similar dynamic is also occurring in the car seat category, which has declined by 9% in volume, but growth by 5% in value. This dynamic is primarily explained by the Isofix models which provide a more secure and easier way of attaching child seats in cars. These are naturally more expensive when compared to those with belt fittings (approximately £160 vs £64). The Isofix models account now for 45% of category turnover and market share is growing by 18% year-on-year - a factor influencing our own distribution agreement with Swandoo.

The introduction of EU safety regulation for child car seats is also shifting sales towards i-Size models, with sales volumes growing by 23% at an average price of £225.

In a market where consumer demand has declined, it's quite clear that UK consumers are purchasing less, but remain willing to look for more high end products. This is especially true within the baby care categories where higher-end product is synonymous with safety as well as quality.

The current scenario can be seen as a good opportunity for both retailers and manufacturers to face an overall falling consumers' demand with a more premium assortment in order to maximise their turnover. Also for this reason, targeted promotional activities can have a big impact on the market.

We are grateful to GfK for this research.