Best Face Forward.
Grocers must narrow assortments, offer value and merchandise creatively to win in this category.
Supermarkets are taking a pared-down approach to facial, hand and body moisturizers, offering a narrow selection of best-selling items and targeting fill-in shoppers.
"Supermarkets have to make it easy for consumers to shop this category, or they are going to purchase online," warns Candace Cortlett, president of New York-based WSL Strategic Retail. If consumers are browsing, they're doing so online or in channels with an extensive selection. One-fourth of shoppers are buying facial skin care products online, according to Cortlett, and one-third are pre-shopping consumer package goods online before purchasing in stores.
That doesn't mean there isn't opportunity for the grocery channel, however. "Supermarkets don't need to focus on the shopping experience in this category," notes Cortlett. "Their opportunity is in replenishment trips, and they can win those purchases by making sure the best-selling facial moisturizers are represented and by organizing them in a way that makes it easy for consumers to find. Research shows consumers will pay more for products they really want or to purchase in a convenient location."
Only the Best Sellers
A buyer at one Midwestern supermarket chain says his store layouts are tight on space and don't allow for special fixtures or lighting, so he's narrowed the focus to best-selling products. "Space is my enemy, so I'm concentrating on best-selling fill-ins," he explains. According to the buyer, Neutrogena and Olay best-sellers are driving his company's business in facial moisturizers, while the hand and body business is dominated by Gold Bond, Eucerin and Jergens. "The category is mostly basics," he says. "I can't remember the last time I sat through a spa-positioned presentation."
Safeway, a division of Albertsons Cos., is sticking to the best-seller formula by keeping its facial moisturizer section trimmed to 3 feet. Best-selling brands such as Olay Regenerist and Olay Total Effects share space with L'Oreal's Revitalist and Neutrogena's Hydro Boost. The Pleasanton, Calif.-based retailer aggressively promotes the category with on-shelf signage signaling everyday pricing on best-selling products. Safeway and Englewood Cliffs. N.J.-based Unilever recently ran a promotion offering $5 toward a gift card with the purchase of $15 worth of participating Unilever brands.
Wendy Hale, of Plainwell, Mich.-based Harding's Friendly Markets, notes that selection varies by store size. "In our larger stores, Olay and Neutrogena are the best sellers, but our smaller stores may stick with value brands like St. Ives and Ponds," she says.
According to Hale, Gold Bond specialty moisturizers are performing well at the stores, particularly the brand's Diabetics' Dry Skin Relief and Ultimate Eczema Relief Skin Protectant Cream, which were introduced over the past few years by Sanofi's Chattanooga, Tenn.-based Chattem division as part of a line of therapeutic products. The chain promotes regularly in-store and in circulars.
Sorting Out the Segments
While some higher-priced facial moisturizers are still performing well, anti-aging facial moisturizers are in a slump overall, with multioutlet dollar sales down 4 percent, according to IRI data for the 52-week period ending Oct. 2. The general facial moisturizer category is faring much better, with dollar sales in that segment up 6 percent for the same period.
Neutrogena's Hydro Boost, introduced in 2015, had a strong year, and a few products from the Aveeno Active Naturals, Cetaphil and CeraVe brands showed double-digit increases, according to Chicago-based IRI. The Olay brand has lost market share to Johnson & Johnson's Neutrogena Hydro Boost and Aveeno Active Naturals.
Face oils, according to London-based Euromonitor International, are gaining some traction in the category. Last year, Physician's Formula introduced the Argan Wear collection, which includes a facial oil. Ahold's Etos brand beauty oils, which can be used on the face, body and hair, are carried by the company's Stop & Shop and Giant Landover stores. Stop & Shop recently tweeted about the oils on its Twitter feed.
Natural beauty brand Yes To recently launched multitasking PrimRose Oil Miracle Oil and Argan Oil Miracle Oil. The natural brand is being carried at Giant Landover stores, which also offer Burt's Bees and Unilever's Simple in a small natural section.
"Natural beauty products are growing at seven times the mainstream growth during the latest 24 weeks, based on IRI data, and are contributing over 20 percent of the absolute dollar growth," says Ingrid Jackel, CEO at San Francisco-based Yes To.
Jackel adds that best-in-class retailers have large dedicated natural skin care sections with good signage, education, graphics and premium merchandising to call attention to key product features. "They promote new natural beauty products prominently and consistently in high-traffic secondary locations, including end caps, floor stands and clip strips," she says.
Men's skin care is also getting more play in the category. Last February, Switzerland-based Galderma Laboratories, with U.S. headquarters in Fort Worth, Texas, launched Cetaphil Men, a line of skin care products that includes three moisturizers: Daily Face Lotion SPF 15, 3-in-1 Daily Lotion and Extreme Healing Lotion. Men's personal care is a growing segment: According to recent research from Chicago-based Mintel, men's personal care in the United States is anticipated to reach $4.7 billion in sales by 2021.
Overall, the past year has been light on innovation in the hand and body moisturizer category, and IRI multioutlet data show hand and body moisturizer sales to be flat overall. Some brands, such as Jergens and CeraVe, have had slight upticks in dollar sales. Chattem was the only company to post a dollar sales share gain, due to the success of its therapeutic Gold Bond line. Dollar sales of Chattem's Gold Bond Ultimate Hand & Body lotion were up 5 percent for the period.
Therapeutic skin care products are performing well, particularly those targeted to specific conditions.
Valeant Consumer Healthcare, a Canadian company with U.S. headquarters in Bridgewater, N.J., recently introduced CeraVe Healing Ointment, formulated to provide intense, long-lasting moisturization for eczema-prone skin. The product doesn't include lanolin. "More than 20 CeraVe products have been awarded the National Eczema Association seal," says Kelly Schnitzer, a spokeswoman for the brand. "CeraVe is the fastest-growing brand at retail, and growth has been driven by consumption, not price." Sales of CeraVe's Hand & Body lotion were up 6 percent for the period.
Cincinnati-based Kao USA introduced a line of wet-skin moisturizers under its Jergens brand last year and launched another wet-skin moisturizer under its Cur'l brand this year. Jergens Wet Skin Moisturizer offers twice the moisture of a traditional lotion and is specifically formulated to absorb quickly into wet skin. Cur'l Hydra Therapy Wet Skin Moisturizer featutes proprietary ceramide technology and a cationic formula to provide skin-healing benefits.
Additionally, Galderma's Cetaphil recently launched an In-Shower Moisturizing Oil. According to Jeanette Chantalat, marketing director for Cetaphil, "Innovation in fun/unique packaging or unique product forms, such as in-shower, are driving purchases and trade-up behavior in the category."
"Supermarkets have to make it easy for consumers to shop this category, or they are going to purchase online."
--Candace Cortlett, WSL Strategic Retail
"Best-in-class retailers promote new natural beauty products prominently and consistently in high-traffic secondary locations."
--Ingrid Jackel, Yes To
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|Date:||Dec 1, 2016|
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