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Euromonitor International is pleased to announce the publication of the new Tissue and Hygiene 2012 system, now live on Passport. The updated tissue and hygiene market research provides insight into how the tissue and hygiene industry is performing and how a changing operating environment, which sees income growth in the developing world and economic instability across much of the developed world, is affecting spending patterns and the broader competitive environment.
In spite of a difficult year, which saw disaster in Japan, a crisis in the Eurozone, and political unrest in the Middle East, the retail tissue and hygiene industry posted 7% value growth, equivalent to US$10 billion of incremental growth, pushing the industry to US$152 billion in 2011. Whilst the headline statistics make for encouraging reading, 2011 continued to be a tale of two markets. Developing and emerging markets largely pushed global growth with impressive 14% growth in 2011, stemming from an emerging middle class in key markets such as China, Brazil, Iran and Mexico. Click to Tweet! Conversely, the developed world saw spending slump, especially in the retail environment, with cash-strapped consumers in North America and the troubled Eurozone region looking to cut back on expenditure where possible.
Tissue continued to conform to the general market trend that saw emerging markets continue to drive global growth of 6%, or US$4 billion incremental growth over 2010, with China alone accounting for almost 40% of this incremental figure. Value sales were, however, boosted by raw material price inflation as volume growth was less impressive at 4% over the same period.
Toilet paper remained by far the dominant category, with increasing income levels in the developing world helping to boost sales. Interestingly, some of toilet paper’s highest growth rates were posted in the Middle East and Africa region where territories such as Iran, for example, continued to see a Westernisation of toilet culture, which saw toilet paper volumes continue to climb as consumers switched from water only. As a result, Iran saw volumes rise by 16% in 2011, while India posted the largest increase globally at 18%, although from a much lower per capita base. Click to Tweet!
Whilst toilet paper remained the key driver in the global tissue market, other categories such as boxed facial tissues and kitchen towel reported much lower sales. The majority of sales for these less commoditised products remained in the developed markets and as such fell victim to ongoing economic difficulties with consumers looking to cut back. These cutbacks were most evident in economies that experienced most uncertainty during the year. The US, Japan, France, Germany and the UK all saw volumes decline in 2011 and it was a similar story in boxed facial tissues, as consumers looked to reign in household expenditure.
With higher income levels generally required to make these products mainstream, the developed and emerging markets were generally unable to drive sales as they have done in other markets with 6% value growth low, compared to the double digit growth experienced in other categories. Globally, Turkey, Russia, China and Brazil continued to drive value sales but the tissue category in general saw unit price inflation that consequently produced volume growth at around half this rate, with consumers at least anecdotally substituting a whole range of tissue products with cheaper toilet paper across the developed and developing world.
Retail hygiene sales fared a little better in 2011 posting 7% value sales growth, which was something of a return to form following the global recession that saw growth rates struggle to get much above 5% for much of the period. Nappies remained the key category accounting for half of total hygiene sales. The category continued to see rapid sales growth in the emerging markets where China and Brazil were chief volume and value growth generators, thanks to a mix of large infant populations and rising income levels, which put growing numbers of parents within reach of nappy products. The use of nappies in the emerging world has been underpinned by a general rise in working women as well as manufacturers’ efforts to develop distribution, as well as offering smaller pack sizes (especially in Latin America), which has allowed parents on the fringes of affordability the opportunity to purchase nappies for special occasions such as days out and night use.
The global sanitary protection industry, which is the most accessible of hygiene products in terms of affordability, went through a further period of modernisation in 2011. Key developing markets such as China, which already have high penetration rates, saw consumers switching in greater number to more modern ultra-thin formats. There was a similar story in many territories in Latin America and Eastern Europe. This penchant for added value products saw value growth far outstrip volume in key growth markets such as China. From a low base, India provided the largest year-on-year growth in 2011, with 15% volume growth evidence of the more widespread use of sanitary protection. Click to Tweet! With the introduction of Arsha, a campaign designed to provide subsidised sanitary protection to rural school girls and the mooted reduction of retail unit prices, India appears as the key region for sanitary protection growth over the medium term.
The developed world fared less well, however, with North America seeing value sales decline due to economic problems as well as a rash of discounting by retailers. Western Europe fared slightly better posting value gains, although both markets were underpinned by the expansion of incontinence sales, which developed apace , especially as a reaction to austerity, which saw cash-strapped governments continue to push responsibility for healthcare services back onto the consumer. The UK, for example, saw the issue hit the headlines in 2011 as the tests patients were required to complete to qualify for prescription incontinence provision were classed as both humiliating and degrading to sufferers.
The Away from Home (AFH) tissue section of the market had a solid year in 2011 with volume growth of 3%, which was the strongest rate reported since 2006-2007. Whilst sales were predictably encouraged by the developing world, with, for example, toilet paper increasingly found in public conveniences, it was the developed markets, and particularly North America, which saw a return to growth as consumers apparently tired of making cutbacks returned to foodservice and vacations, which helped boost sales of a variety of tissue products, including paper tableware, paper towels and toilet roll. Western Europe, by contrast, saw the away from home market for tissue continue to stagnate, with only the prospect of a recovery or at least stabilisation in the Eurozone likely to improve matters.
In the latest edition, we have continued to invest heavily in our global research network, strengthening and improving the coverage across all 80 geographical markets.