Hair care

Drug Store News, May 20, 1996

Hair care continued to be a challenging category for drug stores last year. As mass merchandisers continued to push down prices, customers continued to favor those outlets over drug stores.

At year's end, drug stores were no longer the dominant channel for hair care sales. Mass claimed 37 percent of the category, drug cornered 32 percent and food took 31 percent.

"Drug in general is losing hair business period," said Dorothy Masters, director of Helene Curtis, chain drug customer business unit. "There are a lot of reasons for that. It's not a destination department for drug. It's a convenience department. Mass merchandisers are willing to lose money in hair to bring consumers in, and they make it up in soft- and hard-line goods."

For drug stores the best news in 1395 continued to be in hair color. It was the only hair care segment that produced dollar sales gains for the channel.

Semi-permanent (also known as tone on tone), hair color that lasts for 24 shampoos, fueled the growth. Buyers praised Clairol's Natural Instincts and L'Oreal's Casting for keeping the category vibrant. These brands brought new women into the category and provided options for women to trade up from Loving Care and other shorter lasting products.

"Natural Instincts and Castings are big brands, and the category has a following," said Paul Carlson, beauty care buyer, Snyder's Drug Stores.

The restages of Ultress and Preference helped those brands perform better, and the availability of new highlighting products from both Clairol and L'Oreal also expanded the hair color category.

Many chains, including CVS, Rite Aid, Walgreens and Snyder's, increased the size of their hair color sections as the popularity of the category grew.

Hair color is the only hair care category where drug stores repeatedly have an edge over other channels. "War-Mart and other mass merchandisers give hair color away and run it as a loss leader, but their out-of-stocks run high," said Penny Wade, cosmetics and fragrance buyer for Harco Drugs. "If a woman's color is not available at Wal-Mart, she's not going to change her hair color shade. She'll come to a drug store to buy it."

The selection in food stores is often much more limited than drug stores, and as drug chains add more space to their sections, that should continue to be a point of differentiation for the channel.

With the upcoming launches of L'Oreal's Belle Color and Clairol's Hydrience, and the restage of Clairol's Loving Care, shelves will be getting more crowded. "It's though to figure out how to fit [Hydrience and Belle Color] in," said a buyer at a regional chain. "L'Oreal and Clairol are telling me to cut back on Revlon, but it's located in a different part of the section."

Buyers seem optimistic about Hydrience, a water-based, permanent product designed to be gentle on the hair. "There is nothing else like it in the market," said Wade. "Clairol is spending $30 million to advertise it. We'd be foolish not to support it." It was too early to get a feel for buyers, take on Belle Color at press time.

Temporary hair color items, such as Glints, Rev Up and Exuberance, didn't perform as well as some buyers had hoped, and some of these products may be removed, buyers said.

Other hair care segments continued to be a struggle. In drug stores, shampoo dollars shrunk 7.1 percent and conditioner dollars dropped 5 percent. Mass merchandisers, on the other hand saw sales of shampoo increase by 10.1 percent and conditioners increase by 12.9 percent.

The emphasis now is on healthy, natural looking hair, and 2 in one shampoo/conditioners, natural products and those positioned to be intensive, reduce frizz and nourish hair have been performing well.

Premium-priced products performed the best for the channel, and explain why unit losses in both those segments were steeper than dollar losses.

"Shampoo sales in drug stores were tough sledding because the consumer views shampoo as a commodity," said Carlson. "You see a lot of shampoo switching, but Head and Shoulders, Pantene Pro V and Pert are some exceptions."

Clairol's launch of Herbal Essences shampoo and conditioner was also a pleasant surprise for many drug buyers.

Professional brands, premium brands and niche brands provided the best opportunities for drug stores.

Specialty products and intensive conditioners provided the mast excitement in conditioners. Clairol's Infusium, Frizz-Ease, hot oil treatments and vitamin-based products were cited by drug buyers as strong performers.

Products for thinning hair, such as Thicker Fuller Hair, performed well for some buyers, and they're hoping this segment will pick up more this year now that Rogaine, a hair regrowth treatment, is available over the counter.

Styling aids were disappointing once again for all channels.

Softer styles and short, straight hair cuts were in fashion, and in general they require less intensive styling aids. The lack of advertising support from brands including Dep and Modern Research Labs (now called Image Labs) also hurt the category. This year, the availability of Herbal Essences styling aids, additional styling aids under the Pantene brand and a big marketing push from Image Labs (Stiff Stuff brand) could help lift sagging sales.