Packaging, education key to natural-to-mass crossover
As attested by suppliers looking to expand from specialty natural food channels into mass outlets, natural food markets may serve as a proving ground for success in mass.
And that would include homeopathic manufacturers, which have enjoyed success in the natural market and the mass market, where homeopathic products are oriented more as a safe and effective solution to a particular condition. According to Nielsen Co. and SPINS data provided by Boiron, sales of homeopathic remedies grew by an aggregate 6.4% for the 52 weeks ended Dec. 27, 2008—with incremental sales of $14.2 million, representing 6% growth in mass markets (excluding Walmart), and incremental sales of $2.5 million, representing 7% growth in natural supermarkets (excluding Whole Foods).
“We devote a lot of resources to making sure our natural foods business is strong,” said Dale Nepsa, president of Hyland’s. “It’s pretty rare for us to introduce anything into the mass market without having success in natural foods,” he said.
Homepathic medicines enjoy several advantages in the natural channel, not the least of which is the lower barrier to entry at the shelf as compared with mass merchants. Natural channel shoppers typically are better educated around the concept of homeopathy and seek homeopathic solutions in place of such allopathic medicines as Tylenol or Robitussin. Similarly, many natural food markets differentiate themselves with a highly educated sales staff that actively interacts with customers.
To make a successful crossover to mass, suppliers of the alternative medicines noted that, without that better-educated consumer and customer service representative, packaging that tells the story is key in mass. “In mass market, you have to make [the packaging] more in tune with the sections where it’s going into,” Nepsa said. “It has to be bright, bold packaging that captures the consumer’s eye as [he or she is] walking down the aisle.”
According to Boiron research, consumers also are more interested in efficacy, followed by such safety messages as “no side effects” and “no drug interactions.”
CVS opens Beauty360 No.3 in one of its original Project Life stores
NEW YORK — If anyone thinks that CVS has recast itself solely as a healthcare company, given its string of acquisitions in recent years — particularly, Caremark and MinuteClinic — they probably haven’t seen a Beauty360 store yet. In fact, standing in the middle of one of these 3,000 sq.-ft., high-end beauty boutiques, you might have a hard time recognizing you were in a CVS store at all.
Beauty360 is the culmination of the long-time vision and an awful lot of hard work on the part of several key individuals, most notably, CVS’ top merchant Mike Bloom, VP beauty merchandising Cheryl Mahoney, senior beauty category manager Mary Lou Gardner and Mike LePage, director, retail innovations and store design. Importantly, it is also a very bold statement that, for as much energy as CVS Caremark devotes to driving solutions that save lots of money for big payers of health care, it is very much still focused on its stores, and using other areas beyond health and wellness to spark innovation and create reasons for customers to shop their stores.
You want to talk about growing the market basket? How about adding a whole other basket? With prices on many items topping $100, Beauty360’s contribution to overall store profitability is palpable. According to CVS executives, sales in the two other locations the company operates in Mission Viejo, Calif., and Washington, D.C., are well ahead of expectations.
And why wouldn’t they be? No woman in her right mind, with at least a minute or two to spare, isn’t going to check out Beauty360 — particularly in the ritzy neighborhoods the chain is putting the stores in. The average household income in Mission Viejo is roughly twice the national average; in terms of shopping, Fodor’s calls Dupont Circle “a younger, less staid version of Georgetown — and almost as pricey”; and the newest Beauty360 in Ridgefield, Conn., is surrounded by seven-figure homes. Bloom says CVS is planning to a whole bunch of them into the former Longs stores it is currently converting, which includes many more posh areas to pick from.
With just 30 of the stores planned by the end of the year, and about 50 by this time next year, it likely will be a while before the impact of Beauty360 begins to be seen in CVS’ earnings. In the meantime, you can expect sales per square foot to balloon in the stores that share a roof with a Beauty360.
Beauty360 is an important message to its competitors that CVS hasn’t forgotten about the importance of creating excitement in its stores.
SDI launches iPhone, iPod application for allergy sufferers
NEW YORK The addition of SDI’s Pollen.com allergy applications to the growing number of iPhone/iPod touch-friendly, health-related applications is just the latest example of how an e-health evolution is more and more becoming a part of America’s daily lexicon.
Already, there are more than 100 health-related applications available for the Apple products, including FDA for iPhone and WebMD Mobile. According to Apple COO Tim Cook, those apps are available to some 37 million users — that’s how many iPhones and iPod touches are currently on the market.
Concerned about what exactly those food additives in your favorite snack are? There’s an app for that. Worried about your blood pressure or heart rate? There’s an app for that. Want to know what your blood-sugar level means? There’s an app for that, too.
Indeed, while SDI was preparing for its official Pollen.com iPhone app launch, two Northwestern University teams took home the top two prizes awarded in the Diabetes Mine Design Challenge last week. The challenge? Develop an iPhone app that diabetics could use to help manage their condition.
Next month, Apple plans to release an updated iPhone 3.0 with support for Bluetooth-enabled medical peripheral devices, like Johnson & Johnson’s LifeScan glucometer. And while Apple is updating its iPhone capabilities, Palm will be introducing its Palm Pre, slated to debut June 6 on the Sprint network. The Palm Pre is expected to give Apple’s iPhone a run for its money, but at the very least, it’ll open the door of health-related mobile apps to that many more users.