Business / Industries

Tampon makers seek breakthrough in Chinese market

By EMMA GONZALEZ (China Daily) Updated: 2015-10-26 07:41

Tampons might be in demand worldwide but not in China. Most global feminine hygiene product makers, dissuaded by the need for heavy investments and negative attitude toward the product, are delaying their launch.

Nonetheless, a small self-funded company called Wishu in Shanghai has taken the plunge.

Three years ago, French bankers Jeremy Rigaud and Virginie Pre, in quest for entrepreneurial adventure in China, quit their comfortable jobs in business finance in France and set up Wishu. They saw an attractive business opportunity in tampons as Chinese consumer habits constantly change.

Although Wishu refuses to disclose sales volumes, it notes that after just three years, the company is already valued at 5 million yuan ($785,000). It continues to expand its product offerings and distribution channels.

Wishu first started selling applicator tampons through popular e-commerce platforms in China such as Yihaodian and to understand customer preferences. It advertised the product using Chinese social media tools such as WeChat.

Through trial and error, Wishu aligned itself with consumer preferences and steered clear of unpopular products, thus succeeding in offering online a product that was non-existent on supermarket shelves. Three years on, Wishu is ready to sell its tampons in bricks-and-mortar stores.

"We are currently distributing our products across all CityShop branches in China and in talks with big supermarkets in Beijing and Shanghai. Soon, our products will be sold also via supermarkets in large cities," said Wishu CEO Rigaud.

Currently, the United States-based Johnson & Johnson alone sells personal care products directly to Chinese supermarkets. J&J's o.b. tampons having been available in China since 1993.

But other large foreign companies such as Kimberly-Clark and Procter & Gamble have steered clear of the tampon market in China, unable to invest in heavy marketing campaigns.

"Large producers probably expect to achieve high revenues from the start and expect high returns on investment very quickly," said Rigaud. "The market is still nascent for them but not for us. If you are able to grab even 1 percent of the huge China market, that would be more than enough for a small company like ours."

Rapid urbanization in China will likely spawn growth opportunities for makers of feminine hygiene products, said industry observers.

By 2018, their retail value is expected to grow to 84.95 billion yuan, compared with 57.71 billion yuan in 2013, according to market research firm Mintel. That represents a 47 percent rise over a five-year period.

However, for Chinese women, tampons are still relatively new. In 2013, the market value of tampons was 1.25 billion yuan, up 8.7 percent year-on-year, but significantly lower than the 49.70 billion yuan that sanitary pads generated in sales, according to Mintel.

Dannie Pai of Procter & Gamble's media relations said the company's Whisper tampons are not sold in China as consumers nurse some conventional beliefs.

Agreed Jessica Cai of Kimberly-Clark. "Culturally, keeping virginity (till marriage) is held in high regard among Chinese women. This keeps tampon trial rate at a very low level."

Thus, awareness campaigns become necessary, but Wishu cannot afford them. Wishu is able to meet demand from women who already use its tampons, but is unable to launch marketing campaigns to attract new consumers.

"Entry of large companies is not a threat to us. They will stimulate the market the same way Starbucks stimulated the coffee shop market," said Rigaud.

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