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Babo News Alert - WWD - The Demand for Naturals

Posted on May 01 2018

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Demand for Naturals Shifts Baby-care Market in U.S.

Natural and organic baby brands are driving growth in the baby category.


By  on April 20, 2018

The baby-care market in the U.S. — which reached $600 million in 2017, according to Kline & Co. data — is undergoing a seismic shift. For starters, the key players have changed. While Johnson & Johnson retains three-fifths of the market share with Johnson’s Baby and Aveeno, Unilever has edged into third position following private-label brands, thanks to the launch of Baby Dove and its acquisition of Sundial Brands, per Kline & Co. Market trends are following what is happening in the facial skin-care category — demand for clean formulations, fragrance-free products and segmentation by skin type, is on the rise.

The channel breakdown is shifting too — 20 percent of U.S. baby-care products are sold online, according to TABS Analytics, which is 10 times higher than the online share across all consumer packaged goods categories. Launching baby care is now considered a gateway into e-commerce for established personal-care brands, says a recent Mintel report. As a result, a slew of new brands and products have launched in the past year, fragmenting the market and driving category growth. Kline & Co. predicts a compounded annual growth rate of 2.1 percent in baby care over the next five years, driven primarily by naturals.

BABO BOTANICALS

The brainchild of L’Oréal product development veteran Kate Solomon, eight-year-old nontoxic beauty and personal-care brand Babo was an early arrival to the natural baby-care boom, but demand for clean formulations in the category is fueling its current growth streak. Babo grew 65 percent year-over-year in 2017 after launching on ulta.com, and will roll out to all Whole Foods doors this year. Industry sources project $20 million in retail sales for 2018.

Its latest launch is a range of fragrance-free products for baby, consisting of six stockkeeping units including a hydrating stick, diaper cream, shampoo and wash, foam wash for newborns, a daily lotion and healing ointment. “Fragrance-free is becoming an even greater category, as mothers are looking for products without allergens,” says Solomon. Prices range from $9.95 to $19.95.

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