unicharm

Gentle care for life

 

Review of Operations

Integrated Report 2019

  • Message from the President
  • About Unicharm
  • A Discussion about Product Development
  • Unicharm: A Story of Sustained Growth
  • Financial and Non-Financial Highlights
  • Change in Business Environment and Unicharm’s Approach
  • Review of Operations
  • Unicharm’s Value Creation Process and Key Challenges

Review of Operations

Health care Business

Basic business strategy

Japan
Our goal is to ensure our loved ones can live their lives with dignity. We will supply products and develop new ideas such as exercise programs to prevent dementia, aiming to help extend healthy life expectancy and reduce the burden on people being cared for and their carers.

Asia
In Asia, where demand for adult incontinence care products is growing, we are introducing our Japanese care model to reduce the burden on people being cared for and their carers.

Japan


Disposable Adult Diaper Selection Guide
Expanding the market by developing products that extend healthy life expectancy and by making a sustained contribution to society
Since moving into the disposable adult diaper market in 1987, Unicharm has led the industry in promoting wider uptake of adult incontinence care products in Japan. We have developed products that address consumer needs in both the moderate and light adult incontinence categories and worked to create new markets. As a result, the health care business has built a dominant position in the retail market with a share of over 50%.
In the light incontinence category, we have used activities to increase awareness about the widespread issue of urinary incontinence and launched products that alleviate concerns about the condition. Those efforts have supported strong growth in the retail store channel, with Unicharm continuing to retain its dominant position in the light incontinence category with a market share of 58%. In the moderate and heavy category, we offer products that help seniors maintain and recover their ability to perform daily tasks and help them gain control over their incontinence.
To encourage even wider use of disposable adult diapers, we are working with retail stores to create sales areas that make it easier for shoppers to select the right products. Also, through partnerships with many retailers, we provide advice to shoppers about how best to use our products.
Meanwhile, in a first for the industry, we launched an online Disposable Adult Diaper Selection Guide that uses an artificial intelligence-powered virtual assistant*1 to provide 24-hour support throughout the year to answer any questions about incontinence care. As Japan’s society ages, more seniors face issues such as loneliness and dementia. To create more opportunities for seniors to interact with society and other people, we started an initiative called Social Walking*2 in 2016. Also, as part of our efforts to create a cohesive society where people and pets support each other, we launched a new animal therapy program to motivate and lift the mood of seniors to encourage them to keep going with their rehabilitation programs. Our face mask range is seeing strong growth, driven by efforts to market them as products for use all year round and by a broader lineup to address demand for comfortable face masks.

*1 A type of computer program or system that conducts conversations instead of people

*2 As the name suggests, the program is about socializing while walking, which is seen as a fun, easy and effective way of preventing dementia disease (Unicharm project run under the supervision of the Tokyo Metropolitan Institute of Gerontology).

Asia

Expanding our lineup and reinforcing our market position in Indonesia, where uptake rates are rising
In Indonesia, where uptake rates are rising steadily, many seniors are responsible for their own incontinence care. That is driving uptake of pants-type disposable adult diapers – a category where Unicharm has a strong position – supporting continued strong growth in our local business. A large proportion of the Indonesian population is Muslim, so we are taking every step to ensure our products can be used with confidence by as many people as possible, such as securing halal certification for diapers to show they are manufactured in accordance with the rules of Islam. We are also actively promoting our products through supermarkets and other modern retail channels.
In the future, we plan to secure halal certification for other products such as disposable baby diapers and feminine care products.

Stepping up global expansion by acquiring local firms
Targeting faster global expansion and a step-change in growth, Unicharm acquired DSG (Cayman) Limited (DSGCL), a manufacturer and supplier of baby and adult disposable diapers with operations in Thailand, Malaysia, Indonesia and Singapore. DSGCL's brand portfolio includes BabyLove, Fitti and PetPet disposable baby diapers and Certainty disposable adult diapers. It has a large market share and high brand visibility in Southeast Asia. The company is building a dominant position in disposable adult diapers in Thailand, which is projected to see even faster population aging than Japan. The addition of DSGCL to the Unicharm Group will enhance Unicharm's product lineup and market position in Southeast Asia, especially in Thailand and Malaysia, realize economies of scale and reduce costs through the integration of operational functions such as logistics. By pursuing those synergies, we aim to accelerate Unicharm’s growth in Southeast Asia.

Expanding sales areas for face masks and raising awareness
Demand for face masks is gaining momentum in India, China and other countries with serious air quality problems. We aim to help people lead healthier lives by expanding sales areas for face masks and raising awareness of air quality issues.

Unicharm’s Value Creation Process and Key Challenges

 

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