The market for body care products, including bath items, has become more upscale and specialized.
Supermarkets can compete in this fast-changing business, but they must stay on top of new product trends, ethnic preferences and pricing, and also know their limitations, according to retailers, wholesalers and other knowledgeable observers interviewed by SN.
While most retailers do well with major national brands and their recent upscale line extensions, only some can succeed with the more specialized salon-type products. Meanwhile, supermarkets can tap product trends involving products for an aging population, more entries for men and the diverse preferences of ethnic groups to maintain their share of sales.
"We are upscaling the supermarket brands of bath and body," said Charles Yahn, vice president, merchandising, Associated Wholesalers, Inc., York, Pa. While sales of the highest-priced items have gone to mall retailers, mass market products are seeing a resurgence in quality, as well as price points, he said.
Bath, body and skin care are categories that have historically been tied together, but available shelf space is one of the biggest obstacles, noted Larry Ishii, general manager, health and beauty care and general merchandise, Unified Western Grocers, Commerce, Calif. "Bath and body is a category that I feel strongly represents an opportunity for us, especially in some of our larger stores, as well as in a conventional format," he said.
Taking advantage of these products is another way to build on the recommendations of the "Women's Well-Being Merchandising Strategies" study released several years ago by the Educational Foundation of GMDC, Colorado Springs, Colo., Ishii said. For example, integrating candles and bar soap
with bath, body and skin care "presents an opportunity for synergy and incremental sales as opposed to the ways we've merchandised them in the past," he said.
Natural products in these categories are another opportunity. "Aromatherapy, bar soap and bath skin care - we like to present that all in the context of a total bath section," Ishii said.
"People are getting more into the luxury lines," said Kathi Danaher, category manager, personal care products, Wild Oats Markets, Boulder, Colo. "They come to our stores looking for products that smell good out of the bottle and that will smell good on them, but yet eliminate the synthetic base," she said.
Bath and body care continues to grow, said Bob Candelora, senior vice president, Market Performance Group, Colonia, N.J., and a former nonfood executive with a major Northeast chain. "There are some great products out there, and skin care in general is a very hot category."
In the bath category, "the more upscale products are finding their way to the shelf and customers aren't afraid to spend money on them," he said.
"Bath and body is a tough, tough category when you are trying to compete with mass and all the other channels out there," said a nonfood executive with a major Southeast chain. "The key is reinventing the category. You've got to do it quarterly. You've got to refresh it. You have to introduce new items as frequently as possible, and that's been our challenge to date."
Many bath and body sales are going to the other channels, including mass merchants and the mall-based specialty stores, but also dollar stores, the executive said. "We are trying to make sure that we have the offerings in store and we are looking at our mix. We also are looking at destination opportunities such as Valentine's Day and Mother's Day to put up endcaps that tell that consumer, 'We're in the game,'" he said.
"We struggle with it," said Al Jones, senior vice president, procurement and marketing, Imperial Distributors, Auburn, Mass. A few years ago, the company went with a greatly expanded bath and body care section of up to 36 feet including upscale products, but it didn't work. "We are back down to a very normal sized bath and body sections - 8-foot, 12-foot - and almost all the upscale is gone," he said.
Around that same time, private-label cooperative Topco, Skokie, Ill., came up with a premium bath and body line, "but we did not get the support from our members," said Curtis Maki, vice president, program, management, HBC/GM/Rx. He partly attributed this to the limited space for these products in most supermarkets.
At Big Y Foods, Springfield, Mass., body washes are a growing segment, including men's products, said Jan Winn, director of HBC and GM. Big Y has an upscale demographic, so those products aimed at that population do well for the retailer, and even bar soaps are doing well. "We've had really good success across all segments. [For example,] Ivory bar soap is No. 2 in our bar soap category," she said.
"Bath and body is going to continue to be a growth category for us," said Wayne Bryant, director, HBC, American Sales Co., Lancaster, N.Y., a division of Ahold USA. "Skin care has been very strong and bath products have done very well, although I'm wondering if we are gong to see that level off a little bit." Men's products in both areas represent a growing trend, he said.
The leading retailer in the bath, body and skin care categories is neither Wal-Mart Stores, Bentonville, Ark., nor any of the specialty chains, but Target Corp., Minneapolis, noted Diane Garber, president, In Sight Communications, Buffalo Grove, Ill. While Wal-Mart might lead in total dollar sales because of its size, Target does the best job of combining products, merchandising and price, she said.
"What you used to get in department stores, Target has brought down to a rather friendly, earthlike level," she said. When it comes to these categories in supermarkets, it's still "theirs to lose." The key for supermarkets, as well as Wal-Mart, is to employ the merchandising art with the same skill as Target, Garber said.
"If they choose to give it the space and the merchandising ambience, they can get more than their fair share of the market," she said. Some education or in-store prompting would help. For supermarkets, this relates to the "whole health" initiative that many have embraced, she said, referring to the recommendation of another GMDC study.
"Ultimate performance" is a key trend in these categories, said Anna Wang, consultant, consumer products, Kline & Co., Little Falls., N.J. "Products promising intensive moisturization or healing at extreme levels are popular, but price plays a major role in the mass bath body market. Unlike face creams, consumers are looking for a product they can just slather on, so value is a key factor."
Additionally, products offering multiple benefits and added value are appealing to consumers, she said.
Kline pegged the total value of bath and body products at $6 billion at the manufacturer level in 2004, according to the company's "Cosmetics and Toiletries USA" annual report.
In facial skin care, all the key trends are toward anti-aging products, or those that maintain a more youthful appearance, said Kat Fay, editor/consumer analyst, Mintel International, Chicago. "Supermarkets mirror trends found in the department stores, so they are currently stepping up efforts for home micro-dermabrasion kits, as well as a wider selection of anti-aging products and cleansers," she said.
Marketing Multicultural Skin Care
NEW YORK - Marketing of skin products to multicultural consumers has come of age and is a "huge opportunity," said Roy White, vice president, education, of the Educational Foundation based here of GMDC, Colorado Springs, Colo.
"Skin care happens to be one of those flagship categories that you need to address very carefully as it is very important to many different multicultural groups," White said. For some, including Hispanics and African Americans, spending tends to be higher, or more frequent.
For example, he cited 2004 numbers from ACNielsen, Schaumburg, Ill., that showed highly acculturated third- or fourth-generation Hispanics who primarily speak English spend an average of $35 annually on skin care compared with $31 for non-Hispanics. Bilingual Hispanics, who generally are second-generation, spend $33, White noted. These numbers were part of the GMDC report, "Multicultural Marketing," that was released last fall.
"You are dealing with a better than 10% increase over what the total non-Hispanic market is doing," he said.
Other numbers show that sales of personal care products to African Americans, Hispanics and Asian Americans is expected to increase 20% over the next four years, White added.
"Skin care has the potential to be a very, very big beneficiary of the growth of multicultural marketing," he said.
For most of these groups, the desired products are the major U.S. brands, while first-generation immigrants will prefer products from their country of origin, he noted.
Meanwhile, national advertising campaigns are increasingly using women of color, such as Halle Barry, Salma Hayak, Jennifer Lopez and Vanessa Williams, to personify feminine beauty, White noted. "There are different skin types, but there is also a culture prompt to buy skin care products because looking good is extremely important," he said.
