Aging population puts new spin on H&BC - health and beauty care products - Discount Industry Annual Report, part 2

Discount Store News, July 20, 1992

Consumers are increasingly shopping mass merchandisers for their health and beauty care needs.

The market share for mass merchandisers has been rising steadily in the last few years and will likely continue to do so in the coming year.

Both large chains like Kmart and smaller regional retailers such as Jamesway are working on growing their H&BC sections.

Changing demographics, particularly the general aging of the American population, will probably be one of the strongest influences in the merchandise selection and promotional strategies at discounter H&BC departments in the years ahead.

There are already signs, confirmed by retail dollar sales, that the older consumer is shopping for H&BC differently.

Face creams, lotions and moisturizing were one of the leading products in the category for 1991. In addition, sun protection products that, along with protection from sunburn also help to delay the sun's aging process, were also a huge category at retail.

In fact, these types of products are increasingly part of the beauty routine with cosmetics. At chains such as Kmart, efforts are being made to display these items closer together.

Hair care products, particularly coloring kit may also benefit from an aging, and graying, population.

Another sign that this change in demographics is influencing the department is the advent of home health care products. Jamesway, Secaucus, N.J., was one of the first to prominently feature the new Cane & Able line of home care products.

The new Jamesway prototype, in Claymont, Del., featured items such as tub bars and clamps, magnifying glasses and jar openers for an older or disabled user.

On the other end of the spectrum, children are an important market segment for H&BC items. This has been fueled primarily by licensing opportunities. The latest to join the fold is Batman, which Tsumura International is marketing under its Kid Care label of bubble bath and mini soaps.

Another pertinent fact about the children's market: the rising birth rate.

With more than 4 million babies born in 1991, retailers can expect to sell plenty of diapers, baby lotions, sun screens, powder and other accessories.

In conjunction with the birth rate surge are higher sales of early pregnancy tests, a product category which was named as one of A.C. Nielsen's "hot" sellers list for the mass market.

These new parents are also more aware of the harmful effects of too many chemicals and may be the prime age groups that will sustain a steady increase in environmentally safe products.

Procter & Gamble recently announced that it would replace all its standard Pampers and Luvs brands of diapers with newer ultra-absorbent versions. The new diapers use much less material, according to P&G. The significant thing about this development is that P&G is actually replacing the diapers it has in stores now. The new versions will be at retailers starting this fall.

Del Laboratories' Naturistics line is already featured in a bold display in a number of discount stores.

Brands such as Fruit of the Earth and Natural Glo may gain momentum as the idea of an environmentally safe beauty regimen becomes standard.

As mass merchandisers do more micro-marketing, other important target areas also become profit niches if treated correctly. Ethnic cosmetics and hair care products, for instance, are being emphasized by a number of major manufacturers. Last year, Maybelline became one among the first mainstream, volume cosmetics manufacturers to introduce a line of cosmetics for the ethnic customer.

In H&BC, particularly hair care products, brands such as Soft Sheen and Dark & Lovely are doing well.

Over-the-counter drugs are another hot item for mass merchandisers. As many prescription items are approved for OTC sales, many discounters find they compete well on price with conventional drug stores.

In fact, it is one of the advantages of Kmart's reorganization of its H&BC division. With both pharmacy and H&BC under one buying division, the chain can react quickly in a fast-changing prescription market.

The two largest full-line discount stores, Kmart and Wal-Mart, have each made significant inroads towards increasing the number of pharmacy departments in their stores.

According to A.C. Nielsen's study of the mass market H&BC area, the number of prescription departments in the mass market actually declined in the first half of 1991. However, this was due to a myriad of stores consolidations.

With expansion for pharmacy planned for both Wal-Mart and Kmart, the number of departments will probably rise significantly during 1992.

H&BC is another retail category that may have a shakeout as retail formats grow. Full-line discounters may find they have more competition in the marketplace. They have more than just traditional drug stores to consider.

More apparel off-price stores are getting into the act offering not just cosmetics, but lotions and moisturizers as well.

Deep discount drug stores, including hard-to-define hybrid formats like Phar-Mor, are taking a bite out of both conventional drug outlets and mass merchandisers.