Following an almost total revamping of the hair care category, retailers are taking advantage
It's the calm after the storm.
The hair care category has seen top-to-bottom changes in products, packaging and marketing in recent years. Retailers and wholesalers told SN that little new has been announced so far this year, and nothing extraordinary is expected soon.
This gives them the chance to conduct category reviews based on all the activity that has taken place so far, and evaluate the market, which most see as moving upscale.
“There is not a lot of innovation right now, but there is a change in that the consumer is looking for a little more quality, and more specialized products,” said Charles Yahn, vice president of sales, retail development, customer service and pharmacy, Associated Wholesalers Inc., Robesonia, Pa.
Among the hair care trends noted by executives interviewed at a recent conference held by the Global Market Development Center, Colorado Springs:
A move to more upscale products, with consumers seeking out professional-grade salon items, and manufacturers repositioning their mainstream lines as more prestigious, a trend being referred to as “masstige.”
Bold and often colorful packaging that has brought an entirely new look to hair care sets.
Continued growth of ethnic products, as retailers understand that these products can be sold outside urban areas.
The beginnings of a move to natural and organic products, driven by customer demand and suppliers' marketing.
“We're starting to see the influx of organic products and incremental SKUs,” said Dan Spears, director, HBC/GM, Ingles Markets, Asheville, N.C. “Mostly, I've seen a restaging of products in their package design and colors trying to create a broader appeal, and bring a little more pizzazz to the category.”
This is a year for consolidation, said Al Jones, senior vice president, procurement and merchandising, Imperial Distributors, Auburn, Mass. “There was a lot of change last year, but I don't see that happening this year. There is nothing that is really hot. It is the brands digging in and doing what they need to do to solidify their market share,” he said.
Not all manufacturers have made their presentations yet, so there may be some major new products coming, said Bill Martin, category manager, Valu Merchandisers Co., Kansas City, Kan. These are more likely to be line extensions than the big launches seen in the past year, he said.
“It's a great category for us,” said Mike Bevel, director, general merchandise, Minyard Food Stores, Coppell, Texas. “There are more and more brands that Hispanics are responding to.” Hair color is becoming more popular with ethnic groups, he added.
In total, key hair care categories rose 1.1% in supermarkets to $1.8 billion for the 52 weeks ending Sept. 9, according to Infoscan Reviews of Information Resources Inc., Chicago. This includes the following categories: hair spray/spritz; hair styling gel/mousse; hair coloring; home permanent/relaxer kits; shampoo; hair conditioner; and hair growth products.
Shampoos rose 1.6% to $670.7 million for the period, while conditioners increased 4.2% to $401 million, IRI reported. Consistent with a move to higher-priced products, unit sales for these categories were down slightly.
Brands are using their repackaging efforts to get attention at the point of sale, said Tom Vierhile, director of Datamonitor's Productscan Online, Naples, Fla. The “masstige” trend also is a factor, he said.
“Masstige is a fancy way of saying mass market companies are trying to push their products closer to the prestige segment, if not in price, then in perception. So instead of going downscale they are trying to turn it into a department store-perceived product. This has also been referred to as the democratization of luxury,” he said.
“Our hair care categories in higher-income demographic areas are experiencing a good life because of professional products that are becoming more mainstream,” said consultant and former retail executive Bill Mansfield, president and chief executive officer, VIP Inter- national, Garland, Texas.
“We see a consumer shift to a higher level of hair care,” said Yahn of AWI. “Before, we gave a lot of SKUs and a lot of space to the economy brands, but now you see consumers willing to pay for better products.”
“We've seen the consumer start looking for more of the premium hair care items,” said Anthea Jones, group vice president, center store, Bi-Lo, Mauldin, S.C.
Bashas', Chandler, Ariz., put a line of professional hair care products into 33 stores in the fourth quarter of last year, and “it's doing very, very, very well,” said Sue Vodika, HBC buyer/category manager. “I have downsized on the value brands of hair care and doing mid-tier to premium products more extensively.”
“The only category that is growing is the salon hair care because it is still fairly new,” said Nick Barainca, director of nonfood, Scolari's Food & Drug Co., Sparks, Nev.
NATURAL AND ORGANIC
Partly out of concerns over ingredients in imported products, but also because they are perceived to be of higher quality, hair care items labeled as “natural” or “organic” are growing in number and sales.
While organic claims are regulated, the term “natural” can be used without the same kind of substantiation, leading to the question about whether it is a true product benefit or a marketing gimmick.
“I think it's a little of both,” said Bi-Lo's Jones. “We don't have a natural shampoo item, but we do have some organic products in our set, and they've done relatively well. The trick is making sure that whatever you present to your consumer, it's a believable option. What you don't want is to say we have a natural or organic shampoo, when it isn't natural or organic.”
There's no regulation over the word “natural,” Yahn of AWI said. “You can put just about anything you want on a package. However, the consumer will see through it” if it's not backed up.
It's difficult to say whether natural/organic claims are just about marketing because so much depends on how well the products work for individuals, said Larry Ishii, general manager, GM/HBC, Unified Western Grocers, Commerce, Calif. “There is no question that natural and organic is real. We have had a reasonably strong program at Unified in health and beauty care products now for a long time, and so, in a manner of speaking, we've just been waiting for the rest of the world to wake up.”
While upscale is the key trend in hair care, natural and organic products are going to become a bigger part of the mix because consumers have become concerned about the composition of all products following the highly publicized problems with Chinese imports, said Martin.
Additional reporting: Wendy Toth