Chains expand space, address growing number of herbal products

Drug Store News, July 20, 1998

"Our herbal segment is up 73 percent for the first quarter," said Sharon Findley, Longs category manager for OTCs and baby care. However, for the same 13-week period, vitamin sales climbed only 25 percent in Longs stores.

As such, the Bay Area-based chain will add an extra two feet to an herbal set, which currently runs six feet, "without taking away from any other category," a tricky proposition, Findley admited. Where space absolutely does not permit an addition to a store's in-line herbal presentation, Longs has developed a two-foot, winged end-cap to augment the existing set, the planogram for which will be set largely by Findley at the chain' s Walnut Creek, Calif., headquarters.

However, in keeping with the Longs tradition of allowing its individual stores to retain some level of autonomy in merchandising decisions, the winged sides of the display unit will not be planogramed centrally, leaving the space for store managers to set according to their own discretion. This allows individual stores to tweak their inventory-a crucial concern with regard to merchandising herbal products, where a community's demographic profile might dictate that a particular store go long on one type of supplement over another. For instance, a store with an older clientele may choose to go long on saw palmetto at the expense of, say, an extra St. Johns Wort facing.

And, the company already has big plans for the extra shelf space. In fact, Longs is gearing up for an upcoming private-label launch of 17 herbal SKUs manufactured by Pharmavite under the Longs store brand.

In addition, Findley and other chain buyers noted that they would have to find room in their planograms for some of the major herbal launches that were to set to premiere last month at NACDS Marketplace. The pre-Marketplace buzz was that Warner Lambert, American Home Products and Bayer Consumer would unveil herbal lines under their existing Centrum and One-A-Day labels in Philadelphia.

However, neither AHP nor Bayer was ready to present their new herbal offerings last month in Philadelphia. Still, the AHP line is set to include seven currently hot-selling herbs developed by Pharmaprint, including a gingko and a saw palmetto supplement. No details were available at press time with regard to the new Bayer line.

On the other hand, Warner Lambert, which was among the very first of the OTO giants to go herbal (the company made its first forays into natural care last fall, leveraging its expertise as a confectioner in order to develop a better lozenge through the dual launch of Halls Zinc Defense and Celestial Seasonings Herbal Drops with Echinacea), was ready to unveil its Quanterra herbal products at Marketplace. Quanterra Mental Sharuness is a gingko-based formulation; Quanterra Mood features St. Johns Wort.

Another chain re-evaluating its natural care sets with an eye toward expanding its herbal presence is Snyder's. The company, which currently runs approximately four feet of herbs and homeopathy as part of a 25-foot vitamin set, is considering bringing its total herbal presentation up to six feet to eight feet, according to healthcare buyer Roger Musil.

While Musil said the chain initially took a more cautious approach to developing its herbal set, first beginning with an endcap presentation so as to establish a presence without sacrificing dollars from another segment, he maintained that further expansion should be concentrated on an in-line presentation immediately adjacent to vitamins. "We don't want to lose a customer because he or she can't see our full complement of products," Musil said.

According to Musil, a portion of the additional space has already been earmarked for nearly half of' the new Pharmanex line. Last month, the Simi Valley, Calif.-based natural care manufacturer launched a new 31-SKU line of single herb formulas to retail at a suggested price of $5.30 to $8.99. Musil plans to take on 15 of the Pharmanex herb formulas.

Single herbs still strongest

"I don't think the general consumer is ready for [herbal] cocktails," said one buyer from a regional chain.

Indeed, most retailers who spoke with Drug Store News noted that while herbal combination supplements, often marketed as nutraceuticals, have performed well among a smaller, but better-informed herbal consumer segment smart enough to know they may be receiving more phytomedicinal bang for their buck(s), single ingredient herbal formulas in the $4.99 to $6.99 range continue to drive sales in the category.

However, one category manager who once swore by the strength of lower-dollar-ring herbal items as attractive points of entry for new users to the category has since softened that position. According to Tim Bland, category manager for OTC and health care at Drug Emporium, while the lower-end items still provide the Ohio-based deep discounter with bread and butter sales that form the core of its natural care business, he believes the consumer is finally beginning to embrace the amount of science that is behind many of these products, and that has "pushed up the bar" in terms of what the herbal supplement customer is willing to spend.