Changes In The Air

Shifting demographics are adversely impacting growth in the feminine hygiene segment, but retailers still will find store brand opportunities if they are willing to invest in product and packaging enhancements.

If you are looking to grab a share of a fast-growing category, you might want to forget about the feminine hygiene segment. While some feminine hygiene subsegments (sanitary napkins, tampons) are seeing flat or slightly negative dollar and unit sales growth, others (douches, feminine deodorant sprays) are losing significant ground here. (See the table on p. 66.)

The feminine hygiene segment might not be setting the world on fire in terms of growth, but it certainly is changing rapidly. And according to "Sanitary Protection and Feminine Supplies — US," a May 2010 report from the global market intelligence firm Mintel International, shifting demographics are going to play a key role in the segment in the years to come.

"Protection products will be affected as numerous baby boomers leave the market and fewer young Hispanic women take their place," the report says. "Aging baby boomers are causing a decrease in demand for protection products, which represent the lion's share of the market, while driving demand for the smaller personal lubricants segment of the market."

Dollar sales within sanitary protection and feminine hygiene products grew just 7 percent since 2004, the Mintel report says.

Although girls are reaching puberty at younger ages, adding to the demand for sanitary protection, Mintel notes that many women now rely on oral contraceptives that result in lighter or fewer periods. The consequence? These women require fewer sanitary protection products.

The weak economy, too, has had an impact, attracting more women to lower-priced national brands and store brands. Consumers between the ages of 25 and 34 report a significantly higher likelihood to switch to less-expensive brands than other age groups do, the report adds.

Focus on innovation

Despite the growth challenges, the feminine hygiene segment is still seeing plenty of innovation.

Dan Saylor, vice president of sales for Lincoln, R.I.-based Rostam US, counts the new (pH-balanced) RepHresh Brilliant pH tampons from Cedar Rapids, Iowa-based Lil' Drug Store Products and Kimberly-Clark's new U by Kotex line of tampons, pads and pantiliners (in black-and-bold-colored packaging) as two noteworthy developments.

"The pH balance tampon will be a true game-changer in the category once the consumer understands the product," he says.

As Lil' Drug Store Products explains it, the tampons are clinically shown to reduce the usual feminine pH increase that occurs during the menstrual period. How? Through pH-reducing Micro-Ribbons, which release a patented natural and non-irritating pH-reducing formula.

Irving Park, Texas-based Kimberly-Clark notes that the U by Kotex lineup is an "innovative feminine care solution that offers bold new packaging, feminine product design and empowers women to change the conversation surrounding women's health."

U by Kotex "is changing the market by focusing on a very specific market segment," Saylor adds, "and, by the way, taking on the number-one brand: Pearl."

In addition to product innovations such as these, retailers will want to look to plastic applicator formats for any new store brand tampon offerings, Saylor says, because that's "where the market is going."

Rob Lippucci, product marketing manager for Cleveland-based HOSPECO, agrees.

"Plastic applicator tampons and more compact tampons that women can safely and easily tuck away in their purses are other products showing growth potential," he notes. "Plastic tampon market share continues to grow at the expense of cardboard applicator tampons. Users often cite comfort, ease of use and dependability as factors in their purchase choice."

Mintel also alludes to opportunities in eco-minded tampon tweaks and in the creation of thinner pads. Eighty-three percent of surveyed consumers said they wish tampons were safe to flush, the report says, while 61 percent said they wish they could find tampons made from recycled materials. On the pad side, respondents pointed to still-too-bulky pads and pad leakage as their top two problems.

"Ultra-thin pads/napkins are more popular than regular," the report notes, "as technology continues to improve and make it possible to absorb more."

Pantiliners already are very thin, but Lippucci says users continue to demand more convenience and portability. He notes that individually wrapped pantiliners have realized strong growth and represent a good opportunity for store brands.

Even with all the opportunities for innovation and improvement, Lippucci reminds retailers they need not try to be all things to everyone — a basic product mix is a good model.

"A retailer's private label program does not have to be the biggest and have the most SKUs to be successful," he says. "This is an example of the old saying, 'less is more.' By concentrating on those things you do best, the overall program has a better chance of success."

Rethink packaging

Higher packaging counts — 2.5X and 3X — also are becoming important on the store brand side, Lippucci notes. And differentiated packaging is a newer opportunity for store brands. Individually wrapped pantiliners have realized strong growth and represent a good opportunity for store brands.

"One of the packaging/ product trends we have seen from some retailers is the effort to position the product line as its own 'private brand' through different packaging looks and creation of a new name or tie-in to their existing brand," he says. "The store brand teams, most often through strategic branding/design agencies, have tried to position their brand as a standalone product line that is a convenient, quality alternative to the national brands."

Lippucci notes that this strategy goes against what retailers have done for years — that is, making a concerted effort to mimic a specific national brand. In fact, many of these newer store brands do not even include a "compare to" national brand statement on the package. And some of them embrace the "clean" packaging trend, using a lot of white with color accents and design elements.

"The intent is to create a unique look that, in some cases, ties into the brand, while making it easier for the consumer to identify the desired products with similar attributes via color or iconic package elements," he says.

But don't stray too far from the national brands, he advises.

"Differentiated and unique packaging completely unrelated to the brands, in some cases, may be confusing to the customer," Lippucci stresses. "If the consumer is used to seeing a certain look and colors from the branded products they have been purchasing, and the same product in a private label version is completely different, it can cause a disconnect."

He mentions one customer that insisted on a design that relied on the same contrast color for all of its store brand heavy/overnight products, regardless of the target product or brand. After the products had been on the shelf for a few months, the retailer asked HOSPECO to change the contrast colors to match the target brand colors because many shoppers became confused.

Get results

A great product and great packaging are only part of the battle. Retailers that really want to call attention to new store brand feminine hygiene products also will want to save some energy for merchandising and promotion.

Saylor notes that Rostam and "a couple of very good retailers" recently ran a marketing program with St. Petersburg, Fla.-based Catalina Marketing and saw outstanding results.

"You just need to be creative in how you structure the offer to get the most bang for your buck," he says.

Lippucci points to the introduction of fashion "tins" from European and American suppliers that hold pads or tampons as a potential cross-merchandising possibility.

"These help to fill the need for cleanliness, portability and organization," he says, "while at the same time, are often viewed as a fashion accessory."

The Mintel report concurs, and suggests that type of presentation also could be built into the product package.

"Manufacturers are trying to break out of the commodity mode and bring some class and design to feminine protection products," the report says. "Moxie feminine protection products [from Moxie Products US, New York] are presented in candy-striped boxes, and the tampon collection comes in different color schemes — peach (mini), dusty pink (regular) and turquoise (super)."

Moreover, the Internet and social media are becoming increasingly important as marketing tools for this segment, Lippucci says, particularly for communicating to teens and tweens.

"Reaching these young women before their buying habits are set and encouraging trial of the private label products [are] vital to long-term growth," he says.

Finally, do not let the national brands dominate your marketing strategy, Saylor emphasizes. Protect your store brand.

"Retailers need to remember that they own the shelf," he says. "The drug chains have been very good at getting it right."

Do look to plastic applicator formats for any new store brand tampon offerings.

Don't forget the importance of convenience and portability to users of pantiliners — individually wrapped renditions represent a big store brand opportunity.

Do aim for differentiation when it comes to packaging, but don't stray too far from the national brands.

Individually wrapped pantiliners have realized strong growth and represent a good opportunity for store brands.

'Manufacturers are trying to break out of the commodity mode and bring some class and design to feminine protection products.'

Don't let the national brands dominate your marketing strategy; protect your store brand feminine hygiene products.