Product innovation sharpens growth in hair removal

Drug Store News, Dec 17, 2001

Apparently, removing body hair continues to be a primary concern for consumers, as sales in the shaving and depilatory categories continue to rise steadily in food, drug and mass.

Leading the charge, according to retailers with whom Drug Store News has spoken, Gillette has driven a great extent of the growth in Razors--a business worth more than $1.2 billion in food, drug and mass, according to data from Information Resources Inc. for the 52 weeks ended Oct. 7. Tracking its brands across complete razor systems, refill blades and disposables, Gillette's brands accounted for $874 million, or 71.7 percent, of all dollars spent on razors during that period. And though Gillette's razor brands number some nine different lines, nearly 44 percent of that business comes from two key lines: Venus and Mach3, the Nos. 1 and 2 top-selling complete razors, respectively, Nos. 4 and 1 in refill blades.

On the market only since April, clearly, Venus has proven a major success for the trade. "The feedback that we've gotten on Venus has been tremendous," said Peter McDonough, vice president of marketing for Gillette's North American region. "To have a women's razor drive the razor category is unprecedented."

Tracking razors and refill blades, Venus generated more than $79 million across all channels in its first six months, according to the IRI numbers.

Meanwhile, with the dollars down on its base Mach3 razor business (sales for Mach3 refill blades, worth more than $261 million, were still up 17.8 percent through the first week of October), Gillette last month unveiled the second generation: Mach3 Turbo. Developed under the James-Bondian code name "245," Turbo--which incorporates four key design enhancements to the blades, lubricating system and razor handle--should throttle Mach3 sales, particularly with the complete razors as existing users trade up to Turbo. In consumer focus groups the company conducted, 55 percent of Mach3 users "significantly preferred" Turbo's performance.

"We knew from our research and development team that we could continue to bring new ideas into the category," McDonough said. "[The Turbo] is not one breakthrough idea like moving from a two-blade technology to a three-blade technology.

It's taking the existing technology platform of Mach3 and working with each element of it to increase it."

Turbo hits retail shelves in April 2002, along with a completely re-staged Gillette Series personal care line (for more information, see Drug Store News, Nov. 19, 2001, page 51). The razor, organizer and two cartridges will retail for $8.99, as will a four-cartridge refill.

Bladeless removal

The depilatory segment continues to climb in the food, drug and mass channels, held up with products that are easy to use at home, such as Aussie Nads and Epil Stop, said Troy Claussen, personal care buyer at Lewis Drug. Certainly today's tighter economy in general favors the performance of beauty products that shift high-ticket salon services into the home for a fraction of the cost. But factor in the highly personal nature of some of these types of services, and it is clear why depilatory sales have been trending up in the high double digits for the past 18 months.

Sales in the segment, which include waxes, jumped 42.3 percent during the 52 weeks ended Oct. 7. Chains have taken notice of this growth. The new Walgreens in New York City uses its front-of-store windows, along with its skin care aisle, to merchandise Aussie Nads and Epil Stop. The two products share a few things in common: they were both introduced as As-Seen-On-TV products; they both offer an alternative to traditional depilatory and hot wax products; and both rank in the top five brands in the category.

Nads, a gel-like concoction made from household cooking ingredients, such as honey, lemon juice and molasses (first developed by an Australian housewife), grew from a simple grass-roots marketing approach. "They began demonstrating it in malls in Sydney," said Hal Lederman, vice president of marketing for Aussie Nads in the United States, of the brands earliest marketing efforts. Lederman acquired the U.S. marketing rights in 1999.

After just 18 months in the United States, Nads is now the No. 1 brand in the category, racking up more than $33 million dollars at retail during the 52 weeks ended Oct. 7, a growth of some 288 percent.

"The heating issue is a problem for some people," Lederman described of the brand's appeal. "It makes removal uncomfortable. ... If you don't heat, you get a lot less sensitivity on the skin and less pain."

Other suppliers have tapped into the no-heat phenomenon such as Sally Hansen, which introduced No Heat Gel Hair Remover Kit in the second quarter. It ranks No. 3 according to the IRI data, jumping 22.9 percent in sales to $25.6 million.

Top brands in depilatories (*)

                                $ sales (**)  % change

Total                            $137.3         42.3%
Aussie Nads                        33.9        266.2
Nair                               29.0         18.3
Sally Hansen                       25.6         22.9
Epil Stop                          13.9        232.9
Magic                               6.0         -2.4

Source: Information Resources Inc. for the 52 weeks ended
Oct. 7 in food, drug and mass

(*)Numbers include waxes

(**)Sales in millions
Top brands in razor blades

                 $ sales (*)  % Change

Total            $675.2         3.2%
Gillette Mach3    261.4        17.8
Gillette           83.3        -6.3
Sensor Excel
Gillette Sensor    74.6       -12.9
Gillette Venus     34.7          NA
Gillette Sensor    29.9       -13.4
Excel Women
Private label      29.0        -3.8
Gillette           26.7        -7.7
Atra Plus
Gillette Sensor    20.9       -26.8
For Women
Gillette           20.6        -4.8
Trac II Plus
Schick Silk        19.2        11.7
Effects Plus

Source: Information Resources Inc. for the 52 weeks
ended Oct. 7 in food, drug and mass

(*)Sales in millions