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There is growing competition in the diaper market with Chinese brands entering the US, creating pricing pressure.s.
Barclays Managing Director and US cosmetics, household, and personal care analyst Lauren Lieberman joins Market Domination to highlight that these upstart brands, which are manufactured in China, have a "premium look and feel to the packaging." Most importantly, these are brands gaining market share in major retailers like Walmart (WMT) and Target (TGT).
"So, when you look at the scanner data there's this loose category called 'all other'... And, all other has been the share winner, and it is these brands," Lieberman says.
Additionally, Lieberman transitions into discussing GLP-1 weight-loss drugs and consumer nutrition trends. “GLP-1s are easy to put your finger on as a big structural change,” she says, while emphasizing that volume issues are influenced by various factors like economic pressures.
To watch more expert insights and analysis on the latest market action, check out more Market Domination here.
Lauren, I I gotta ask you about something specific that I read about in one of your notes. And this has to do with Kimberly Clark, the big diaper maker. Talk to me about Chinese diaper dumping. Now, perhaps unfortunate turn of phrase. But basically, what we're seeing is a glut of diapers coming into the US and other markets from China. I guess that is creating some pricing pressure, something I didn't know about. Can you talk to me about how that's sort of playing out?
Yeah, it's interesting. Those are definitely your words, not mine, but I I I don't I don't mind how you did that. It was cute. The um so yeah, you know, it's been interesting. The um there are some small brands in the US that have showed up that you wouldn't know they're from China. They've got cute names. They are um featured both at Walmart and Target. You see them. Um and but they're they're they're upstart brands that are manufactured in China and have come in and they have sort of a premium look and feel to the packaging. They feel very modern and they've been taking share. Um and so when you look at the scanner data that there's this, you know, loose category called all other. Um and all other has been the share winner. Um and it it is these brands. The one thing I mentioned in that Kimberly Clark note is that they shared with me they're seeing that in Latin America as well, um that there has been some of this these Chinese diaper manufacturers um that are now, you know, shipping product into Latin America as well and that's been putting pricing pressure in the market.
Lauren, I'm curious given the names you cover and and the food they're selling. I'm curious how they're talking about GLP-1s.
So I don't cover I I don't cover food. Um my my colleague Andrew Lazar does. I'd say it's um gotta tread lightly here. So um what are companies saying on GLP-1s? And I can I talk I cover the alcohol names. Um so a mixed a mixed bag. You know, you hear some saying, of course it's out there. Of course it's a factor. You have some companies are talking about innovation and what they're doing to modernize their portfolios and their products on the shelves to have more nutrition or nutrition dense products that would work well for consumers that are taking these drugs. Um you also hear companies saying, sure, it's a factor, but there's also other things going on that are impacting volume like um economic, the wallet pressures that you just mentioned, right? So there's so many things. I feel like the um I don't want to call it the easy answer, but GLP-1s are easy to put your finger on as a big structural change as we're all searching to understand why volumes have been soft. But the manufacturers are not really there in terms of saying this is the thing.
Got you. Fair enough. Not a straight line. Thank you, Lauren. Appreciate it.
Okay, my pleasure.
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This post was written by Josh Lynch