Industry Trends in Infant Feeding

INDUSTRY TRENDS IN INFANT FEEDING

MARÍA MASCARAQUE

Associate - Health and Wellness Research

© Euromonitor International

2

Euromonitor International: Strategic global market research

ABOUT EUROMONITOR INTERNATIONAL

http://www.euromonitor.com/

IMPACT OF CONSUMER TRENDS ON MILK

FORMULA SALES

GLOBAL MARKET INSIGHT

FUTURE OUTLOOK

US$46

billion GLOBAL SALES OF MILK FORMULA (2016)

40%GROWTH (2011-2016)

US$13

billion ABSOLUTE GROWTH (2011/2016)


5

Working mothers drive milk formula sales

IMPACT OF CONSUMER TRENDS ON MILK FORMULA SALES

Negative impact on milk formula

Increasing employed female population

Short length of maternity leave

Permissive advertising regulations

Increasing breastfeeding rates

Decreasing birth rates

Positive impact on milk formula



6

0

5

10

15

20

25

30

35

2010 2011 2012 2013 2014 2015

Reta

il v

alu

e (

US

$ b

illio

n),

co

nsta

nt,

fix

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2016 e

xch

an

ge

rate

HW Milk Formula Sales in Developed Countries vs Emerging Countrie 2011-

2016

Emerging and Developing Countries

Developed Countries

Birth rates much higher in developing countries


0

5

10

15

20

25

2010 2011 2012 2013 2014 2015

Bir

ths p

er

1,0

00 p

op

ula

tio

n

Birth Rates in Developed Countries vs Emerging Countries 2010-2015

Emerging and Developing Countries

Developed Countries



7

Massive discrepancy in breastfeeding rates between countries


0

10

20

30

40

50

60

70

80

90

100

% e

xclu

siv

e b

reastf

eed

ing

<6 m

on

ths

Breastfeeding rates: top and bottom countries (2015)



8

Weak advertising legislation key advantage for milk formula sales


No legal measures

US

Japan

Thailand

Few provisions in law

China

EU

South Korea

Many provisions in law

Mexico

Saudi Arabia

Indonesia

Full provisions in law

Brazil

India

Vietnam

International Code of Marketing of Breast Milk Substitutes



9

The increase of working mothers make milk formula more desirable


440

460

480

500

520

540

560

580

2010 2011 2012 2013 2014 2015

Millio

n

Head of Household (Female) 2010-2015

1.08

1.10

1.12

1.14

1.16

1.18

1.20

1.22

2010 2011 2012 2013 2014 2015

Billio

n

Global Employed Female Population 2010-2015



10

Long maternity leave: An advantage to breastfeed?


0

10

20

30

40

50

60

Weeks

Length of maternity leave: top and bottom countries (2015)



FORMULA SALES


FUTURE OUTLOOK


12

FF milk formula accounts for the majority of milk formula sales


0

5

10

15

20

25

30

35

40

45

50

2011 2012 2013 2014 2015 2016

Reta

il v

alu

e (

US

$ b

illio

n),

co

nsta

nt,

fix

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2016

exch

an

ge r

ate

Global Milk Formula Market 2011-2016

Organic Milk Formula

Special Baby MilkFormula

FF Milk Formula



13

China alone accounts for 41% of milk formula sales in 2016


83 mn children aged 0-4 Exclusive breastfeeding rate (<6 months) 28%

US$19 bn



14

Best performance coming from toddler milk formula


0

4

8

12

16

20

2011/2 2012/3 2013/4 2014/5 2015/6

% y

-o-y

gro

wth

Milk Formula Value Growth by Type 2011-2016

Standard Milk Formula

Follow-on Milk Formula

Toddler Milk Formula

0% 20% 40% 60% 80% 100%

Asia Pacific

Australasia

Eastern Europe

Latin America

MEA

North America

Western Europe

Regional Breakdown of Milk Formula Value Sales by Type 2016

Standard Milk Formula Follow-on Milk Formula

Toddler Milk Formula



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0

5

10

15

20

25

Reta

il v

alu

e (

US

$ b

illio

n),

co

nsta

nt,

fix

ed

2016

exch

an

ge r

ate

Sales of Milk Formula by Key Functional Ingredient Advertised in the Label 2016

Nutritional science as a driver of innovation




16

Convenience key for working mothers


• Handy pack sizes for "ready to drink"

Puleva Peques 3

(Lactalis, Spain)

• Individually-packaged liquid milk formula

Haihai Stick Pack

(Wakodo, Japan)

• Solid milk formula cubesMeiji Hohoemi cube

(Meiji, Japan)



FORMULA SALES


FUTURE OUTLOOK


18

0

10,000

20,000

30,000

40,000

50,000

60,000

2016 2017 2018 2019 2020 2021

Reta

il v

alu

e (

US

$ m

illio

n),

co

nsta

nt,

fix

ed

2016

exch

an

ge r

ate

Milk Formula Performance in Developed Countries vs Emerging Countries 2016-2021

Developed countries

Emerging anddeveloping countries

Growth mainly coming from emerging countries

FUTURE OUTLOOK



19

Mimicking breast milk key to fuel milk formula sales

FUTURE OUTLOOK

0

20

40

60

2016 2017 2018 2019 2020 2021

Reta

il v

alu

e (

US

$ m

illio

n),

co

nsta

nt,

fix

ed

2016

exch

an

ge r

ate

Global HW Milk Formula Sales by Type 2016-2021

Organic Milk Formula Special Baby Milk Formula FF Milk Formula



20

China will continue leading growth within milk formula

FUTURE OUTLOOK

The end of the “one-child policy”



21

Move towards premiumisation in emerging markets

FUTURE OUTLOOK

0

2

4

6

8

10

12

14

16

18

20

2016 2017 2018 2019 2020 2021

Un

it p

rice (

US

$/k

g),

co

nsta

nt,

fix

ed

2016

exch

an

ge r

ate

Milk Formula Unit Price 2016-2021

Growth: 4%

Biostime SN-2PLUSWyeth S-26 Progress Ultima TM3

Illuma 3



22

National policies to further fuel breastfeeding

FUTURE OUTLOOK

WHO

Exclusive breastfeeding up to six months of age

Policies strengthened to promote breastfeeding

Objective by 2025

Increase exclusive breastfeeding in the first six

months to at least 50%



23

Toddler milk formula outperforms in saturated developed markets

FUTURE OUTLOOK

34.2%

5.4%7.3%

0

5

10

15

20

25

30

35

40

Toddler milk formula Follow-on milk formula Standard Milk Formula

% g

row

th 2

016-2

021,

co

nsta

nt,

fix

ed

2016 e

xch

an

ge

rate

Milk Formula in Developed Countries 2016-2021



24

Key recommendations for milk formula manufacturers

FUTURE OUTLOOK

Invest in nutritional science as a driver of innovation to get milk formula as close as possible to breast milk

Improve the convenience of packaging brings a key competitive advantage to manufacturers

Attempting to establish stronger and premium brand images in emerging markets

Focus on toddler milk formula in saturated developed markets


THANK YOU FOR LISTENING

Q&A

María Mascaraque

Associate - Health and Wellness Research

[email protected]

@MascaraqueMaria

https://uk.linkedin.com/in/mariamascaraque

mailto:[email protected]

https://twitter.com/ewa_hudson

https://twitter.com/MascaraqueMaria

https://uk.linkedin.com/in/mariamascaraque

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Industry Trends in Infant Feeding

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