In 2012 Santher - Fábrica de Papel Santa Terezinha SA remains the leader in the Brazil retail tissue market, with 24% value share thanks to its leadership in all product categories except tissues. The company targets middle-class consumers and is constantly investing in new product launches to maintain its position. For instance, in 2012, Santher launched decorated kitchen towels under its Snob brand, featuring seasonal and festive prints. In tissues, the manufacturer reformulated its Kiss brand with a new logo and new packaging designed with fashionable prints as well as several other patterns, including wild animals, pop-art, French boudoir, ethnic and floral prints, in order to position boxed facial tissues as a home décor item. The company also adapted its prints to personal toilet paper brand by launching Personal Décor, where the sheets are printed with arabesques and the carton tube is black. Given these investments and its brands' strong price positioning, the company saw its share continue to rise steadily.
Toilet paper continued to dominate consumer spending in retail tissue in value terms in 2012, accounting for 81% of the category. Furthermore, toilet paper is the fastest-growing in 2012, with a rise of 7% in retail volume sales and 15% in current value terms, boosted by the success of double- and triple-ply toilet paper over single-ply products. Volume sales of economy toilet paper saw a 5% drop in 2012, while standard and luxury toilet paper experienced 15% growth. This is due to the shift in consumer habits and the trend towards added-value items. As a result, average unit prices of toilet paper increase by 7% overall in current value terms, boosted by the rising cost of raw materials, including cellulose and plastic.
Volume and constant value sales of retail tissue are expected to see respective CAGRs of 5% and 6% over the forecast period. Sales will be boosted by rising disposable income, especially among lower and middle class households, combined with a relatively low penetration rate and the tendency to trade up towards more sophisticated items. Aware of the growing success of added-value products which allow higher profit margins, manufacturers should increasingly invest in product innovation in order to differentiate from competitors and gain market share.
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