A highly fragmented and disorganised market means limited consumer knowledge of tissue benefits … and a drive for the cheapest options. Now, brands are gearing up to increase consumer awareness and establish distinct identities. Report by Pallavi Arora, Research Analyst, Euromonitor International.
India – home to the highest population in the world – exhibits remarkably low tissue consumption compared to global and Asia-Pacific averages. While China’s per capita retail tissue consumption stands at 6.7kg, India lags significantly at just 0.1kg. Given the close population figures, the disparity in retail tissue consumption between the two nations is striking.
Several factors contribute to India’s low tissue consumption, including traditional practices, economic constraints, and limited awareness. Many Indian households have historically relied on reusable textiles, such as cloths and towels over disposable tissue products for personal and household hygiene. This cultural norm positions disposable tissues as less of a priority. Additionally, economic factors play a significant role; a substantial portion of the population still grapples with financial constraints, leading many consumers to favour more cost-effective, reusable alternatives. For lower-income segments, tissue products are perceived as luxuries rather than necessities.
Additionally, awareness of the benefits of tissue products, such as convenience and hygiene, remains low, particularly in rural areas where about 64% of the population resides. Many in these regions are unaware of the advantages and uses of disposable tissues, continuing to rely on reusable cloths due to economic limitations and limited knowledge.
However, this landscape is beginning to change, presenting significant growth opportunities, especially within urban populations. Post-Covid, there has been a heightened focus on hygiene and health, resulting in increased demand for disposable tissue products. Urban consumers are realising the importance of personal hygiene and convenience, driving a shift towards adoption of tissue products. This trend is further supported by the expanding middle class, which is more inclined to invest in hygiene-related goods. Additionally, the rise of e-commerce and quick commerce platforms has made these products more accessible, allowing consumers to purchase them online and receive deliveries in as little as 10 minutes, all from the comfort of their homes.
Meanwhile, AfH tissue consumption is becoming a key growth area in India’s tissue industry. As urban lifestyles evolve, consumers are dining out, travelling, and spending more time in public spaces, which has led to an increased demand for disposable tissues. Restaurants, cafes, and workplaces are recognising that providing these tissues enhances the customer experience by promoting a clean and hygienic environment. Facilities that focus on sanitation are particularly appealing to hygiene-conscious consumers, making tissues an essential component of the hospitality experience. This shift highlights a growing awareness of hygiene in AfH settings.
The growth in AfH tissue consumption is also positively influencing at-home usage. As consumers become accustomed to the convenience and hygiene benefits of tissues in public settings, they are more likely to adopt similar practices at home. This trend is fostering greater awareness and acceptance of tissue products as essential household items.
Overall, the interconnected rise of tissue consumption in both public and private settings is creating a ripple effect, encouraging broader adoption of tissue products in everyday life across India.
Outlook: positive prospect with sustainability as an emerging trend
Looking ahead, India’s disposable income is expected to grow at a compound annual growth rate (CAGR) of 11.1% in local currency (current) terms from 2024 to 2029. This growth is set to outpace the average for the Asia Pacific region, highlighting India’s robust economic trajectory. With increasing disposable income, consumers are expected to spend more on disposable tissue and hygiene products, contributing to the growth of the tissue industry. The convenience and hygiene offered by disposable tissue products are expected to play a crucial role in influencing purchasing habits, especially in urban settings where lifestyles are evolving rapidly.
Consumers in India are becoming increasingly concerned about the environment and are eager to take action to make a positive impact. According to Euromonitor Sustainability Consumer Survey, in 2023, about one-third of Indian respondents reported that they strive to contribute positively through their everyday actions. This growing commitment to environmental issues highlights the importance of sustainability in consumer decision-making. Consequently, sustainability is emerging as a key factor in the tissue industry, where eco-friendly practices and products are shaping market trends and meeting the evolving preferences of environmentally conscious consumers.
In response to the sustainability trend, tissue brands are increasingly focusing on eco-friendly practices, including sustainable sourcing, production, and packaging. This shift involves using recycled materials and adopting biodegradable and compostable options to minimise environmental impact. Companies are also likely to invest in transparent supply chains to reinforce their commitment to sustainability. An example of this trend is Beco, a direct-to-consumer home grown brand in India that offers unbleached bamboo tissues made from 100% bamboo pulp. These tissues are biodegradable and sustainably sourced, contributing to reduced landfill waste. Additionally, their eco-friendly packaging reflects a growing commitment to sustainability.
Brand differentiation and private labels will reshape consumer preferences
The tissue market in India is currently highly fragmented and unorganised, with more than 80% of the market categorised as “others”, predominantly consisting of unbranded products. This lack of brand awareness stems from limited consumer knowledge regarding tissue quality, leading many to opt for the cheapest available options, including unbranded products. However, during the forecast period, as brands focus on differentiating themselves through quality enhancements, innovative packaging, targeted marketing, and sustainable practices, they will have the opportunity to establish a distinct brand identity.
As a result, consumers are expected to seek out specific brands in retail tissue products, moving away from the purely price-driven mentality.
Additionally, the rise of private labels is anticipated as retailers launch their own branded tissue products. The growth of private labels can be attributed to several factors: increased consumer trust in retailer brands, competitive pricing, and the ability to offer unique value propositions. Retailers are leveraging their market position to introduce high-quality private label tissue products that can compete with established brands. This trend is particularly effective in driving tissue market growth, as consumers are willing to explore these alternatives that promise quality at an attractive price point.
In conclusion, the overall tissue industry in India is likely to thrive in the forecast period. As consumer awareness of hygiene and environmental issues increases, the demand for sustainable tissue products is expected to rise. Companies that embrace sustainability, transparency, and innovation are likely to capture market share while also contributing positively to environmental goals. This dual focus on hygiene and sustainability positions the tissue industry for a bright and impactful future in India.
