Abstract

This case study illustrates how an innovative eco-friendly idea can help companies in industries with negative environmental reputations. Mabesa, a Mexican company that made and marketed disposable personal hygiene products, entered a challenging niche market with its Bio Baby diapers, establishing a unique, hard-to-copy product that was substantially more eco-friendly than its competitors. As a result, the company gained greater market share in the premium disposable baby diaper market in Mexico and the United States. The case highlights how even in an industry known for high pollution (the widespread use of disposable diapers comes at high environmental cost), companies can reduce the footprint of products, benefitting the environment, consumers, and businesses.

Introduction

This case study focuses on Grupo P.I. Mabe (Productos Internacionales Mabe S.A. de C.V.), better known as Mabesa, a Mexican company that has manufactured and marketed diapers and other personal hygiene products for the past 40 years. Over that time, Mabesa established itself as one of the leading diaper makers in Latin America, rivaling multinational corporations like Kimberly-Clark and Procter & Gamble. In 2015, Mabesa was Mexico's leading manufacturer of private-label products for disposable baby diapers, disposable adult diapers, and women's sanitary pads. In the same year, Mabesa ranked second in sales of disposable diapers for babies and adults in Mexico, Central America, Spain, and Portugal.

And yet, there is another side to this coin. Environmentalists have long criticized the diaper industry for its wastefulness. For example, 93 billion disposable diapers are discarded worldwide each year. Further, approximately 5 percent of global solid waste is comprised of disposable diapers and other similar hygiene products. Diapers clog landfills— or even worse, they are treated as litter and tossed in ditches, rivers, lakes, or the ocean. Even those that make it into landfills require as long as 300 years to fully decompose because of the large amount of petroleum-based plastics used in their manufacture.

As such alarming environmental news has increasingly become a part of consumers’ decision-making processes, Mabesa officials realized that they had a significant role to play in addressing this problem. With world population surpassing 7.4 billion in 2016, the demand for diapers is only increasing. To address this problem, Mabesa turned to the “premium” niche market.