Beauty care shoppers are educating themselves on ingredients, products and technology before deciding where to buy.
This increased knowledge and confidence has translated into a willingness to shop for a variety of products in unconventional channels, retailers and industry experts tell SN.
Retailers are responding by shifting the beauty product mix and presentation in ways that reflect their demographic.
“Beauty is a dynamic and constantly changing category,” said Joanne Leonardi, director of health and beauty for Stop & Shop, Quincy, Mass. “Every retailer in the industry has the opportunity to create shopping experiences that meet their different consumers’ needs.”
Consumers who previously shopped department stores exclusively for creams, lotions and makeup are now buying across multiple channels.
“The average beauty shopper buys in more than four channels,” says Victoria Gustafson, principal of strategic insights for beauty, SymphonyIRI Group, Chicago.
Consumers will go to any retailer that offers some excitement in the category. The more that retailers innovate, the higher sales will grow. There was 2% growth in the beauty category over the last year, she said.
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Cosmetics consumers are actually more likely to shop for beauty products in supermarkets or drug stores than they are to shop in department stores, according to Karen Grant, vice president and senior global industry analyst, The NPD Group, Chicago.
“That holds true even for prestige shoppers,” she said. “Highly engaged beauty shoppers are always on the lookout for new and different products.”
For instance, Stop & Shop consumers have shown growing interest in natural ingredients. Stop & Shop responded by enhancing the selection of natural products.
“Natural has increased due to steady mainstream acceptance,” Leonardi said.
Natural products are making headway in a number of other supermarkets as well.
Retailers Believe in B-leve
Nearly 1,000 stores owned by retailers including Hy-Vee, Giant Eagle, Big Y, Spartan Stores and Brookshire Brothers are carrying “B·leve,” a high-end private-label line of specialty skincare, bath and beauty products with unique natural ingredients.
“The B·leve product line is a great fit for our stores,” said Ruth Comer, spokeswoman for Hy-Vee. “Customers can sample it and take their time in the section, reading about each product.”
The line is unique because natural extracts, such as those from grape stem cells, are included in every B·leve skincare product, according to Tony Harrington, director, program management, HBC, Topco Associates, Skokie, Ill., the private-label cooperative that markets B·leve.
“Our products are targeted to the shopper who wants a sophisticated assortment that is different from what they’d expect to find in a supermarket or mass merchant, but is easy for them to purchase,” said Harrington.
The brand identity for B·leve carries the “B” naming across the entire line. For example, the night cream is called B·restful; the face wash B·luminous; and the color care shampoo, B·colorful.
“We aim to inspire our retailers with a great product and an ongoing pipeline of releases that can be worked into the existing offering,” says Harrington.
Due to the down economy, the definition of prestige has changed, added Craig Rosenblum, a partner at Willard Bishop, Barrington, Ill.
“The focus of shoppers is on value — making private-label premium brands the new indulgence,” he says.
To ensure that each purchase gives shoppers the sense of satisfaction they might feel in a department store setting, Topco developed an implementation strategy for retailers that can be quickly executed across a multitude of categories. It includes a customized outpost fixture with homes for all 55 items in the line.
“One of the key things we did during the development of B·leve was to create a brand that a supermarket can merchandise in a way that catches the attention of the consumer and gives the impression of a specialty store experience,” said Harrington.
The merchandising strategy allows the store to merchandise the products as a family. “We didn’t want shoppers to find three of our shampoos in the middle of a 28-foot shampoo set,” he said.
The fixture includes a QR code that links to a video explaining the brand vision to the consumer.
One of the best examples of high-end beauty merchandising in a supermarket is Hy-Vee’s new flagship store in Urbandale, Iowa.
To create an upscale look, the beauty department has special fixtures, soft lighting and brand messaging. The section also includes backlit shelves and a desk for trials and consultation.
Beauty Care Strategies
Other retailers have tapped into social media to build their beauty consumer base. Giant Eagle, Pittsburgh, for instance, uses its Facebook page to promote new product releases.
Such strategies help get a beauty shopper in the door, and to trade up, says SymphonyIRI’s Gustafson.
“A beauty section that is stocked well and invites exploration will entice a sale,” she said. “We are also seeing retailers do a lot in terms of offering service.”
One way that retailers are making that happen is by adding beauty advisors. Walgreens/Duane Reade, Deerfield, Ill., opened an in-store specialty shop, Look Boutique, in 2010 that features product trial stations and beauty advisors.
Walgreens has 26,400 beauty advisors across the chain, and as it installs Look Boutiques into select Walgreens stores, those departments will have the Look Boutique Beauty Advisors as well, said Marcia Gaynor, general merchandise manager for the Look Boutique.
Extensive hands-on training is provided to advisors in a classroom style to prepare them for questions from customers. Given the wide range of customers shopping the category, with numerous issues they are looking to address, having a beauty advisor on hand is an effective way to invite product exploration.
“The customer is willing to spend more for a product if they are educated on how to use it and which one is right for their specific needs,” said Gaynor.
The biggest driver of the category for the last eight years has been anti-aging products, according to SymphonyIRI. Advances in technology mean that revolutionary products are being offered at two price points: about $15 and $20.
This trend is also particularly visible when looking at private label, she says.
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“The gap between private-label unit pricing and the total average for the facial category is not that big,” said Gustafson. “This means stores are very good about introducing private label across all price tiers.”
For Topco, nearly 70% of women in the B·leve target group of 30- to 55-year-olds have used anti-aging products in the last 12 months, and 67% of those shoppers believe they are effective.
However, with growth hovering around 2%, anti-aging isn’t boosting the category like it used to, analysts told SN. Retailers are constantly on the lookout for the next big thing.
Natural products seem to be the larger trend. In the U.S. multi-outlet channel, which includes supermarkets and drug stores, brands like Garnier Fructis and Yes To are rapidly gaining traction and climbing ranks, according to NPD Group.
“It appears that brands with a natural orientation along with those that incorporate natural with a clinical element are resonating well with beauty consumers,” according to the NPD’s Grant.
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