On November 27th, Chicco and Plasmon announced new exclusive agent alliances with Hangzhou Bimbo Trade Co. Limited, or Bimbo. The partnership is poised to cash in on the growing demand for infant and children’s products in the wake of the elimination of China’s one-child policy.
Plasmon is affiliated with global food giant, Heinz, and focuses on dairy products and dietary supplements for infants. The company is one of Italy’s leading nutritional food brands for infants. Chicco, a premium maternity and infant product brand, also offers a broad range of feeding supplies, infant toys, travel products, infant clothes and cleaning products. Chicco sales channels reach more than 100 countries and reportedly has an 80% share of the European market.
Population Growth Grows the China Market
China’s birthrate is expected to grow at 1.22% during the 2015-2020 period. The removal if the one-child policy will add between 16 and 20 million additional babies per year. This will continue to drive demand for infant and children’s products. Mintel estimates that China’s infant care market will increase from RMB 7 billion in 2016 to RMB 17.6 billion in 2021 with compound annual growth rate up to 20%.
Jin Lingyong, General Manager of Bimbo explained that the two brands, Chicco and Plasmon serve pregnant women, infants and children. They’ve extended their brands by extending both products and functions, serving pregnancy, post-pregnancy, infant, and child-related needs.
Brand Extension to Meet Rising Consumer Expectations
More knowledgeable and sophisticated parents are looking for higher quality products that more precisely fit their needs. Mintel found that 65% of the factors driving market growth arise from rising consumer expectations. According to Jin Lingyong, Chicco entered China at the beginning of 2001. Initially, it sold through an agency, but made little progress. Jin believes that many of these problems stemmed from a single product line, lack of “hero” products, a single distribution model, tight price control, inconsistent branding, poor after-sales service, and lack of sales support teams.
As Chicco’s China general agent, Bimbo has taken measures to address these shortcomings. Bimbo has increased product lines, launched popular products, strengthened nationwide channels, changed pricing policies, coordinated domestic and international marketing efforts, and improved after-sales service and marketing.
In addition to large-scale production facilities and 600,000 sqm warehouse space in Como, Italy, Chicco also has its own R&D team. The company’s Infant Observation Center conducts behavioral research and holds regular seminars with physicians, pediatricians, and educators.
New products that Chicco and Bimbo recently unveiled include infant banana toothpaste, infant strawberry toothpaste, infant toothbrushes, infant gingival gel kits, and other oral care and cleaning products.
Integrating Resources to Improve Marketing
Recent Nielsen research indicates that maternal and infant product purchases are concentrated in supermarkets, physical retail outlets, online shopping platforms, and department stores. Specialty retail and supermarkets account for the majority of product sales.
In addition to signing general agency agreements with Chicco and Plasmon, Bimbo has also signed dealer agreements with eight domestic partners. According to Jin Lingyong, Chicco and Plasmon products will still focus on specialty retailers, chain stores, hypermarkets, and supermarkets.
Jin noted, “Bimbo not only plays the role of general agent, but also runs the brand.” In the future, the company will run integrated marketing programs using an O2O strategy. “Through online cooperation with material and infant product brands, media and opinion leaders, it will execute a range of integrated marketing campaigns.” Offline, Bimbo also conducts local, and point of sale campaigns. It promotes after-sales services and educates consumers on core product features.
Learn more about the latest infant care products at China Beauty Expo 2018.