In online retail, baby care products belong to a niche category. The online baby care market began in 2010 with FirstCry.com and BabyOye.com. Since then many other players have come along to extract the rewards of this category.
Understanding the Numbers
The Indian population has grown extraordinarily since independence in 1947. As of the 29th of February, India’s population is at 1.31 billion. We are the second country with the largest population, right after China. At this very minute the birth rate in our country is 51 births per minute. What do these numbers indicate? It’s a good time to be in the business of selling baby care products! The need for baby products isn’t running out anytime soon, as reports say, India will soon over take China. If you’d like to get into the business of selling online, this is your way in.
In 2015, ResearchMoz prepared a market report about the Indian baby care market. According to the statistics collected by the research team, the baby care market in India will progressively grow at a 17% CAGR within the time frame from 2014-2019.
The Indian ecommerce sector is one of the world’s fastest growing sectors. This year it is expected to jump over 2015’s $23 billion revenue by 67%. The ASSOCHAM states that out of all ecommerce categories in 2015, the baby care products segment grew by 53%. Putting this segment in third place, right after apparel (69.5%) and electronics (62%).
Why is this Category so Appealing?
Ecommerce is a modern trend. With urban living taking over most people find it easier to shop online. Not to mention cheaper! New parents prefer the comfort of online shopping compared to physical stores. Then there’s the bit that online retail has a better variety in terms of:
- Baby toys
- Baby apparel
- Baby food
- Baby cosmetics
- Baby diapers
- Baby accessories
The market for baby car seats is expected to expand by 4.96% by 2020
. Baby strollers and prams on the other hand will witness a 5% CAGR by 2020
. The increasing income in households and the increasing need for baby products due to high birth rates, is fueling the growth of the baby care market in India every day.
In 2012, the baby care product market size was estimated at around INR 15-25 billion. Since then the Indian children and baby care market has reached $11.12 billion and keeps growing. Upon inspection of the product prices in this market, you will notice the essentials fall within the 100-200 rupee range and nothing less. And this range is non-inclusive of shipment fees!
Who are the Key Players?
According to the numerical aggregates from SimilarWeb
, we acquired the following figures about baby care product specific platforms online:
FirstCry.com is the largest online store for baby and kids products in India and Asia. They maintain stocks of numerous baby brands and all kinds of baby products. In January, Ratan Tata’s invested in the online store. Business is booming for this mega retailer and the plans for its expansion go beyond its online presence. At the start of the year, FirstCry’s CEO, Supam Maheshwari said they plan on setting up another 100 stores to double their existing number of 150.
BabyOye.com is another online store that specializes in infant care and maternity products for women on the journey from pregnancy to motherhood. The store was taken over by the Mahindra Group last year. BabyOye currently have over a hundred offline stores and products from a variety of renowned brands. According to recent announcements, the Mahindra Group will bring the US based children’s clothing brand Carter’s to BabyOye.
Hopscotch.in is an India based ecommerce service for mothers. It was founded by the former executive of Diapers.com. The online store provides insider access to exclusive baby and kids brands from all over the world. Recently they landed $13million from Facebook co-founder, Eduardo Saverin. The startup has seen a 700% consistent growth year after year and believes 2016 is the year they break even.
MyBabyCart.com is an online marketplace for online baby care products. They have a variety of online products for babies, infants, children and mothers. They encourage women entrepreneurs to follow their business dreams, which is why they provide a ready platform for women sellers to sell online.
Other players involved in expanding this niche category are Hoopos.com, LittleShop.in, BabysJoy.com, bonsaii.in, zigy.com and NewBabyClothes.com.
What are the Challenges and Limitations of this product category?
Every online category has a set of challenges and limitations. By identifying them sellers and marketplaces can take the right steps to reduce or avoid their negative impact. With baby care goods, the most responsive are city dwellers. Since the market is under penetrated, sellers need to take on promotion activities to make their presence known.
Apart from this there are cultural aspects that affect sales. In most Indian families, hand-me-downs are a common practice. Baby clothes, toys and accessories of the older children go to the younger sibling or relatives kids.
Regulation laws prevent the production, sale and promotion of infant foods
. This cuts down an entire sub-category under baby care products. As a result the growth potential of this segment falls short.
Why is This a Growing Ecommerce Segment?
Despite the problems associated with this segment of ecommerce, the sale of baby and infant care products is on the rise.
- Education – Today more people are being educated about health, nutrition and safety. Expecting mothers are taught about the nutrition they and their babies require to live strong healthy lives. This gives them proper knowledge about the kind of vitamins, minerals and nourishment they need.
- Disposable income – With larger amounts of disposable income in new families, modern quality care products are affordable for newborns. Also with more spending money in hand, people have higher living standards, translating into the requirement for superior products.
- Working women – Times are definitely changing as more women join the world of salaries and wages. It is difficult to look after a baby as it is. Throw a full time job into the mix and life becomes impossible! The ease of ecommerce ends the need for physical shopping at baby stores.
Diverse marketplaces like HomeShop18, Snapdeal, Flipkart and Amazon introduced baby care categories that seem to be going strong. Amazon.in launched its baby care product category in 2013. Whereas, Flipkart started in 2012 and Snapdeal prior to them! Both product specific platforms and multi-product platforms have shown healthy results in the sale of baby care goods. The competition isn’t as heated as you’d expect, however, with new sellers coming into play, we cannot bank on it being this way for long. All we can be certain of is the present potential.