Baby Bunting has estimated that its online channel for babywear has grown from $130 million to $370 million in recent years.
Baby Bunting CEO Matt Spencer said babywear has “traditionally” not been a product category the brand supported through its online offer.
However, with the pandemic accelerating eCommerce growth, Baby Bunting is now planning to grow its offering as well as launch a new online space to capitalise on its expanded total addressable market.
“Traditionally, our online range has been governed by our store footprint or format and the associated shelf space,” Spencer said in an address to shareholders this month.
“We have historically identified the total overall baby goods market at around $5.2 billion.
“Of that, the total addressable market for Baby Bunting based on our store format and offer has been $2.5 billion.”
According to Spencer, the online channel for certain categories has expanded significantly, through investment in its digital platforms and its national distribution centre.
“We are now in a position to be able to expand our online offer and therefore contemplate a significantly larger addressable market.”
Baby Bunting is also planning to launch a Baby Bunting Marketplace, a one-stop baby shop to leverage the brand’s 32 million+ website visitations. It is expected to launch in the back end of FY23.
“We see the Marketplace as an ideal way to grow existing categories and grow our market share of our expanded total addressable market,” Spencer said.
“We will do this via first party suppliers, both existing and new suppliers and drop-ship capability.
“We will also be introducing, by invitation, third-party suppliers to sell a curated range of products.
“Our dedicated project team is working on the technical platform with our solution partner, we are building out the offering and have initiated discussions with potential suppliers.”
“Given these factors, we believe that we can redefine our total addressable market in Australia to be $3.5 billion out of a larger total market.”