The role of local brands in China's baby care market
Global Business

Fresh research from consulting company Mintel showed that revenue from China’s baby care market reached 9.6 billion yuan (about 1.4 billion U.S. dollars) last year. In the face of huge potential and intense competition, Gary Yang, co-founder of Sky Saga Capital, is optimistic that this will lead to better quality. 

China's baby care market is expected to sustain growth in the next five years, with an estimated total sales of 18.8 billion yuan (about 2.6 billion U.S. dollars) in 2023. 

Gary Yang, co-founder of Sky Saga Capital, is in an studio interview with CGTN Global Business. /CGTN Photo

Gary Yang, co-founder of Sky Saga Capital, is in an studio interview with CGTN Global Business. /CGTN Photo

Industry experts at the just concluded Global Maternal and Infant Conference forecasted that the baby care industry in China will see an increased preference for higher quality products, a move towards more specialized and professionalized services, as well as an explosion of social e-commerce and customer-to-manufacturer models. 

Many social media applications are dedicated to observing the baby care market in China. For local brands, Yang highlighted necessity and difficulty of developing a multiple-channel-network (MCN) system for themselves. "The competition is becoming severe. So we have to build up a MCN system,” Yang told CGTN. 

He also acknowledges that China's baby care market has become harder to navigate because of social media. “Harder of course, but [if the] hurdle is higher, the quality is better,” he said. 


Meanwhile, as local manufacturers and ecommerce companies compete for a share of China's baby care market, the game is on to create the best products and marketing campaigns.  

Most domestic brands are new, while foreign brands usually have a long history, said Yang. Because of this, local brands need to focus more on cost and quality, argued Yang.

“The old brands have already developed themselves. And new brands are one the way of development. So the local brands actually have to care about cost and quality at the same time. They are doing price competition with each other, and many people have got prejudiced on the local brands,” Yang said. 

It'll take time for Chinese brands to elevate themselves and compete in the global market. 

“First of all, we have to care about advertisements and markets. Then we would care about prices and costs. And finally, we have to care about the core, which is the quality of the brand. And then we can build up the brand and have the loyalty of customers. So it is a long process we have to go through with step by step,” he detailed. 

(CGTN's Jin Yang also contributed to the story)