LONG BEACH, Calif. -- While many supermarkets have turned to private-label health and beauty care to maintain profitable sales, K.V. Mart has found its customers overwhelmingly prefer name brand products.
The retailer's customer base, which is 70% Hispanic and African-American, is driving national branded product sales in its health and beauty care departments. K.V.'s HBC departments comprise 40-foot sections at its conventional stores and 64-foot sections at the warehouse stores.
"Our customers prefer national brands in HBC," said Don Hart, director of general merchandise.
The issue here is not price but image, he added. "Branded HBC sells better among our customers because it carries a higher perceived value over the private label. Our store-brand HBC doesn't sell as well in ethnic markets as it does in other areas. We are experiencing this in our HBC sales."
Ethnic television advertising in cough and cold, analgesics, stomach remedies, hair, skin and oral care categories has helped drive brand sales, said the nonfood executive. "When you see Spanish TV the HBC ads are very impressive, especially from Procter & Gamble," Hart said.
"The major players have spent a lot of money on Spanish radio and TV to reach this segment of the market. On occasion we'll also run Spanish language messages for these products over the store amplifying system if the items are tied in with our ads."
Therefore, K.V. is highlighting "a lot of national brands, especially shampoo and other high-image categories that get a lot of TV ad exposure" at its 10 conventional Top Valu stores and three warehouse formats that fly the Valu Plus banner, Hart added.
Hart pointed to shampoos as a fast growing segment in HBC at his stores and noted that 30 new selections have been added in the year. Among those new items were highly advertised shampoos like Pantene and shampoos from Revlon. "I originally turned down Pantene, thinking our clientele wouldn't purchase it, but after taking it on it's been very successful," said Hart.
K.V. has enlarged and refined its ethnic hair care, cosmetics and skin preparation department to better serve the needs of its ethnic clientele with 200 items set in a four-foot section.
