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Wellness Concerns Can Drive Store Sales

PALM DESERT, Calif. Supermarkets can realize strong sales potential by responding to the growing demand for wellness products and services, according to speakers at a Wellness Awareness forum this month. In addition to consumer and trade panels, the afternoon educational session included three research-oriented presentations. It was held during the Health Beauty Wellness Marketing Conference

Dan Alaimo

September 24, 2007

4 Min Read
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DAN ALAIMO

PALM DESERT, Calif. — Supermarkets can realize strong sales potential by responding to the growing demand for wellness products and services, according to speakers at a “Wellness Awareness” forum here this month.

In addition to consumer and trade panels, the afternoon educational session included three research-oriented presentations. It was held during the Health Beauty Wellness Marketing Conference of the Global Market Development Center, Colorado Springs, better known as GMDC.

A starting point for many stores should be the pharmacy, said Ed Kuehnle, president, Catalina Marketing Services North America, St. Petersburg, Fla. According to Catalina's research, 55% of consumers did not buy anything other than a prescription on their last trip to a pharmacy. This is higher than a similar number presented earlier in the year by Information Resources Inc., Chicago, which reported that 40% of pharmacy customers leave stores with nothing but their medication.

This translates to 19 million store trips per year with no additional purchase, and a $4.8 billion annual sales opportunity, Kuehnle said. He characterized these singled-minded trips as a “beeline” between the door and the pharmacy.

“You've got to break the beeline. How do you get five out of 10 people to pick something up in your store before they leave?” he asked.

“Inevitably, if they are buying a prescription product, they need other side-effect products to go with it, and they need adjunctive therapy products, ranging from food and beverage to OTCs,” Kuehnle said.

He proposed three ways to make this happen. “Make sure that the pharmacist is engaged with that patient making recommendations,” he said. “Second, the store format needs to be easy to shop with products near the pharmacy that are associated with the top conditions” — diabetes, for example.

A third approach is a new proprietary Catalina offering called RxConx that uses Catalina technology to provide information and product coupons related to the patient's condition based on the National Drug Code (NDC) of the medication. This has been well received by consumers — 80% surveyed said they were interested in such a service, Kuehnle said — and by retailers and wholesalers at the conference.


'HUGE UPSIDE'

“I think that has a huge upside for many of our pharmacy retail partners,” Jay Goble, vice president, merchandising, Valu Merchandisers Co., Kansas City, Mo., told SN. “I've personally been looking for that type of program; it has a chance to really improve wellness.”

This kind of triggering is an industrywide opportunity, Kuehnle said. “We want to continue to find ways to put the right information into the hands of the consumer at the right time. Conditions and related prescription medications is the starting point.” There is also the need for information on nutrients, related therapies, monitoring devices and self-treatable side effects, he said.

However, he warned, many consumers do not feel committed to retail pharmacies and would be fine with mail-order prescriptions.

“The grocery industry, with stores within a mile of just about every customer's home, could become the nutritional center, the educational center, the destination for finding pharmacists and dietitians,” he said. There are 40,000 stockkeeping units in a supermarket, most with a relationship to a particular medical condition, he noted.

“When we look back in 10 years, that's the opportunity that is going to be either solidified or squandered,” Kuehnle said.

Total sales last year for the U.S. health and wellness industry were close to $90 billion, with 6.8%, or $6.1 billion, from natural and organic personal care products, said Maryellen Molyneaux, president, Natural Marketing Institute, Harleysville, Pa. “That's the particular category where we are seeing high double-digit growth,” she said.

Numbers presented by Molyneaux showed natural/organic personal care growing 25% in 2007, 20% in 2008, 20% in 2009, 17.5% in 2010 and 17.5% in 2011. While it is now “a niche opportunity,” it will become a mainstream category by 2015, she said.

Supermarket chains like Kroger Co., Cincinnati; Publix Super Markets, Lakeland, Fla.; and Hannaford Bros., Scarborough, Maine, “are doing phenomenal jobs” in the area of health, wellness and nutrition, said Todd Hale, senior vice president, consumer and shopper insights, the Nielsen Co., Schaumburg, Ill.

“We see tremendous opportunities for manufacturers and retailers to make health and wellness a key part of their messaging. You've got to be able to react to dieting, eating and wellness trends much faster than you have historically,” he said.

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