US Insights

China's newborn population drops 2 million in 2018

Brands 03.26.2019 / 12:00

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Baby and parenting brands should get prepared now.

According to China’s National Bureau of Statistics, China had 15.23 million new-born babies in 2018, 2 million fewer than in 2017. Even though it’s higher than some pessimistic forecasts of below 15 million, still it is the lowest in recent years.



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* Not including number from 2010 because there was a nationwide population census in this year. The annual statistical yearbook stated that the yearly population for 2010 would be included in the census report. But the reports of 2010 census on China’s National Bureau of Statistics didn’t include new born baby number.

Where have the babies gone?

According to the National Bureau of Statistics’ forecast, about 51% of new-born babies in 2019 will be the second child of their parents, which means a lower proportion of first babies. To make things more challenging, the female population between 20 – 29 years has started to shrink since 2015. In 2019, the decline will accelerate to around 6%. However, the year 2019 is a Year of Pig in China’s Lunar Calendar. People born in the Year of Pig are thought to have a more comfortable and richer life. Hopefully, this might encourage more Chinese families to deliver babies in 2019 and slow down the slump.

How will that affect the baby and parenting goods market?

Inevitably, fewer new babies will mean smaller baby and parenting goods market size. In 2018, the impact was limited to goods directly related to new-born babies. With 2018 generation growing older and, if, the new-born rate continues to move south in coming years, the market will really feel “winter is coming”. Baby and parenting goods brands should start to get prepared.

Where are the opportunities for growth?

1.Geographical and channel expansions

Kantar Worldpanel’s Baby Panel has found that the demand from lower-tier cities has already surpassed higher-tier cities. By end of 2018, the total sales of baby and parenting goods has taken over that of higher-tier cities, and its growth rate was higher as well. Though average purchasing power is lower in lower-tier cities, the gap is now narrowing. It means there is greater potential for growth in lower-tier cities. Brands must expand geographically to unlock them.

From the channel perspective, we can see e-commerce and baby/parenting specialized stores have faster growth in the 12 months of 2018 compared with 12 months ending by June, 2018. Both channels achieved double-digit growth rates in high and low-tier cities. Brands should consider an omni-channel growth strategy to optimize their sales channel portfolio.

2. Extend product line: Brands need to develop and launch products for bigger babies to enrich their product offer. We have noticed an increase of products for bigger babies in the market, such as Cow and Gate’s growing up infant milk for 3 – 7-year-old babies. Nutrilon and Mead Johnson have both launched milk powders for babies over 7-year-old. Heinz also developed kids’ cookies based on its teething rusks.

3. Expand into other categories: leverage existing brand influence to expand into other categories and further strengthen emotional bond with consumers. For example, infant milk formula brand Biostime leverages its brand awareness in milk powder sector to launch probiotics powder for children.

Kantar Worldpanel will continue to monitor how the potentially decreasing number of new born babies would the market by publishing a series of analysis reports to help brands find growth opportunities. Kantar Worldpanel Baby Panel will continue to expand product categories under monitoring to offer more in-depth, multi-dimensional insights.

Source: Kantar

Editor's Notes

* Higher-tier cities: four key cities (Beijing/Shanghai/Guangzhou/Chengdu) and provincial capitals, Shenzhen, Qingdao, Dalian; lower-tier cities: prefecture and county-level cities, counties.

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