Unijoy is a premium Japanese diaper brand. The business was inspired by the birth of a son of one of the partners, so the quality of diapers is the brand’s ultimate priority.
The brand's mission is to take care of babies and help their parents. Unijoy products have passed European certification and comply with the EU quality requirements.
While the Ukrainian market is new for Unijoy, the brand has turned to us to get a full picture and the state of the niche. The client expected to receive the data on:
Business Goal: Occupy 30% of the premium and super premium diaper market in Ukraine over 4-5 years.
Since the Client has set ambitious goals and defined KPIs, we have developed the Roadmap for a complete market analysis.
Market Entry Strategy for Japanese Diaper Brand Unijoy in a Dominant Niche Market | Promodo.com
We started by analyzing dashboard data on market dynamics and key players.
Since 2021, the global diaper market has stabilized and reached an average annual growth of 6.5%.
Atop of six global market players are U.S. brands Pampers and Huggies with a capital share of 37.6%. The following four brands are Japanese diaper brands with a total capital share of 11.7%.
The global popularity of Japanese diapers may soon mark the trend in Ukraine.
THE CLIENT asks us:
What is the diaper market capacity in Ukraine?
Considering the balance of the global diaper market, we dived into the exploration of the domestic market. The major players here are Pampers and Huggies, which is similar to the global trend. In Ukraine, these brands hold 77.7% of the market share in terms of money. The remaining market share is shared by competitors.
Hit by the COVID-19 pandemic, diaper sales fell in units, though showed monetary growth. Furthermore, the analysts predict an increase in sales by 2025 with an annual YoY growth of 7-9%.
Local tendency: The sales of a diaper unit depend on the annual number of newborns.
Despite the birth rate has been declining in Ukraine in recent years, diaper sales are falling less rapidly.
The capital growth of the Ukrainian diaper market is possible owing to the premium segment, which aligns with the global market trend.
The graph below shows the average YoY cost increase per diaper unit of 7.03%.
The domestic market will grow despite the declining sales and a lower birth rate in the country. This is due to the increase in the diaper life cycle in a child's life and the growth of the premium diaper segment in Ukraine.
THE CLIENT asks us:
Who are the major rivals for Unijoy in Ukraine?
We used the BCG matrix to analyze the domestic market players.
The BCG matrix is the strategic analysis and planning tool in marketing that helps companies manage the assortment and increase online sales.
We have split major competitors into 4 categories and placed them across the Matrix axes.
At this stage, we analyzed each market player in detail, compared growth rates, market share, and their actions, and painted a real state of competition in the Ukrainian diaper market. We identified the market position of each brand (including the Japanese diaper segment) and argued the core reasons for each position.
Based on this data, we segmented competitors by price and diaper type to identify the Client’s closest competitors.
THE CLIENT asks us:
Is there sufficient capacity for the premium and super-premium segments targeted by the brand to achieve its business goals?
We have monitored the assortment of the domestic diaper market, SKUs, and prices in online sales channels. On this sufficient background, we have identified six more players in the premium segment, including market leaders Pampers and Huggies who offer diapers in all price segments.
We further spotted that the market share of Japanese premium and super-premium brands in Ukraine constituted a mere 6.4% in 2020. In this vein, it is worth noting that a certain market share is shadowed by illegal imports.
While working on the Client’s case, the market capacity was insufficient to achieve the planned sales volume. However, the market potential is positive due to the growing capacity of the segment and the overall trend towards a longer life cycle of baby diapers.
THE CLIENT asks us:
What’s the diaper size range with the highest market entry?
Having explored the diaper range preferred by key competitors and the sales dynamics of each segment, we found 4 diaper types on the domestic market:
The sales of Newborn diapers are falling on a YoY basis due to the overall birth rate decline.
While Unijoy does not target Newborn diapers, the most promising sub-niche includes Junior-type diapers and disposable panties. Meanwhile, Standard diapers should comprise the core of the assortment.
THE CLIENT asks us:
What are the priority diaper sales channels for Unijoy?
To paint the picture of the most promising sales channels when entering the market, we analyzed the performance of online and offline channels in 5-year dynamics. To prioritize online channels, we compared the amount of traffic received by the Diaper category, including all the segments: Standard, Junior, Newborn, and Disposable panties.
We started by analyzing online platforms, including drop-shippers, marketplaces, niche stores, retailers, and pharmacies, while these spots are rather promising despite their insignificant market share.
Drogerie is a self-service discount store located nearby or as part of a mall, that sells non-food daily goods.
The niche retail that specializes in kids’ stuff is attractive to the new brand owing to its full-scale product assortment and the opportunity to work with consultants. Through in-depth interviews, we proved that the target audience appreciates advice from consultants.
Entering the retail channel can be a promising growth point despite the low traffic amount. To gain a competitive advantage, platforms self-promote category products.
Marketplaces, niche online stores, and retail make top-priority sales channels for Unijoy. With that, retail is currently developing the kids’ stuff niche.
Further exploration of the current state of affairs across the offline market made us visit several sales points and check out diaper shelves.
Field research factors we’ve focused on:
THE CLIENT asks us:
What is the best way to build communication?
Official websites are the primary channels of brand communication with consumers. For example, in the case of Pampers, Huggies, and Libero, they perform an exclusive brand communication function.
Traffic distribution among the competitors shows that market leaders actively use performance tools for promotion.
According to Serpstat, the frequency of search queries among key competitors and retailers indicates that those brands who actively communicate with their consumers online gain an increased number of search queries per year. Market players also benefit from partner promotional placements as an effective channel of traffic generation.
There is no communication between Japanese brands and consumers whatsoever. This means that Unijoy may intercept the attention of competitor audiences without extra media pressure.
Part of the traffic coming to competitor websites is from social media, which proves the market authority of this communication channel. To understand how and what brands talk about on social media, we analyzed content on the competitor accounts.
Global brands use their most loyal channels for brand communication and the launch of new products, including bloggers, influencers, and brand ambassadors.
Social initiatives mark another feature of the market. Corporations promote huge social campaigns to increase the number of brand mentionings, build brand reputation, and make a positive media image.
In their turn, small brands do their best to participate in social events. That is how they boost consumer confidence, solidify their market positioning, increase media coverage, and grow their image. In this pursuit, Japanese diaper brands arrange various social initiatives, though not in Ukraine yet.
Working with bloggers and participating in social initiatives are proven means on the local diaper market.
We analyzed the kids’ stuff market as the growth point for Unijoy.
Despite the decline in sales in 2020 due to the COVID-19 pandemic, the sales of baby and toddler products continued to grow steadily.
As a possible growth point, we consider baby wipes and rash remedies that have driven the kids’ stuff market and are less vulnerable to crises and external macroeconomic impacts. Nonetheless, the capacity of the premium segment here is insufficient and accounts for a mere 1.7%. The mass market segment necessitates further expansion.
While exploring the supplementary assortment, we identified the products that are less prone to crisis situations and can become a promising growth point for the Unijoy brand on the domestic market.
Having completed the Project, we provided the Client with the results to help them fully assess the state of the niche and the domestic kids’ stuff market in general.
The research answered the main questions about the market capacity with regard to diaper units and capital. We identified key market competitors, as well as the current competition in the premium diaper segment. We also detected the most effective distribution channels and the most prospective range of products by size and type. Finally, we spotted the most promising growth points for Unijoy in the domestic diaper market:
Since the Client's goals were digitized prior to our cooperation, we compared the data and answered the questions about the relevance of the set KPIs in the premium and super-premium segments.
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