Coming Clean
When washing away the worries of the day, today's consumers are finding stress relief and value in store brand bath and body products. However, many retailers have yet to make a big splash.
Just one peek behind a typical shower curtain today and it's clear that store brand bath and body products are making themselves at home among all the various lotions and potions that accumulate in the bathroom. Thrifty consumers also are smart consumers — they know they can find both value and quality by choosing private label bath and body products. However, name brand soap and other bath and body items continue to dominate, as store brand offerings remain just a small part of the overall market.
According to "Private Label Soap, Bath and Shower Products — US," a May 2010 report from the global market research firm Mintel International, the growth of private label products actually outpaced that of brand names, at least in 2009. In fact, sales within this category have been on an upward climb since 2006, growing 20.8 percent in dollar sales that year alone. However, when it comes to getting their fair share of overall category sales, store brand bath and body products are making little headway.
But all is not bleak in the store brand bath and product world, the report notes. A closer look into the different segments of the bath and body products category reveals a much brighter story. In fact, store brands in some subsegments are giving national brands a run for their money, thanks in part to upgraded packaging, value pricing and national-brand-equivalent quality. Store brand opportunities abound, and retailers could consider diving in and taking advantage of some of them.
Do consider product development in specialty retailer categories such as high-fragrance, body mists and prettily packaged liquid soap.
Bar none
Considering the convenience, variety and ease of use of liquid body products, it's no surprise that bar soap has continued in its fall from consumer favor. Total category dollar sales for both deodorant and non-deodorant bar soaps dropped 4.7 percent during the 52 weeks ending Aug. 7 (food, drug and mass merchandiser stores, including Walmart), according to data from The Nielsen Co., New York. Although dollar sales of private label bar soap grew more than 27 percent during that time period, they claim only a 2.2 percent market share (see table, p. 70).
Store brand liquid hand soap, on the other hand, is making great strides. Dollar sales increased by almost 24 percent in 2009, according to the Mintel report, and private label liquid hand soap's 23.2 percent share of market was second only to Colgate-Palmolive with 38.9 percent.
Consumers' age and gender factor heavily in bath and body product purchase decisions. Women are more likely to purchase soap, bath and shower products, in general, and those with children at home are keenly aware of the need to wash hands frequently, Mintel reports. A lower price is certainly part of the attraction of store brand liquid hand soap. Ultimately, however, consumers might not trust their families' health to store brands if they do not feel product quality and performance are on par with the national brands'.
Don't let the national brands stand in the way of some of the best opportunities — give store brand bath and body products their fair share in flyers, on end caps and in display.
Solid reputation
Innovation within the store brand bath and body products market typically has focused on responding to national-brand-equivalent products, with manufacturers offering specially scented products or those that tout superior cleansing properties, Mintel cites. But now as more retailers insist on third-party testing, some store brand suppliers are growing more confident that their products are positioned to meet or exceed consumer expectations.
Gregory Rubin, CEO of Calabasas, Calif.-based Garcoa Laboratories, points out that the $1 product trend and overall poor-quality products are being pared down in the private label bath and body segment. "People want quality, not cheap," he says. "Affordable quality doesn't have to be equal to cheap products."
As a result, Rubin says, many low-budget suppliers have been pushed out, leaving behind manufacturers that are working hard to offer overall better-quality products, attractive packaging and on-time delivery. However, many retailers are letting the national brands stand in the way of some of the best opportunities.
"Retailers have so much promotional support from certain brands," Rubin says, "that they are tying up the end caps and paying for flyers. But the hard profits are coming from the private label."
In addition to giving store brand bath and body products more facings on shelves, Rubin emphasizes the importance of pair packaging and increased promotional activity.
For example, Garcoa Labs worked with the Deerfield, Ill.-based Walgreen Co. to create a store brand product in a dual package that included a lotion on one side and a sanitizer on the other.
"This [pair packaging] stops the consumers from feeling the alcohol will dry their hands out," Rubin claims, "and everyone who buys one puts it on their desks and proudly advertises the Walgreens brand in their offices, in their kitchens and around the house."
Don't ignore the "free and clear" trend. Many consumers are gravitating toward natural products that are free of paraben, sulfates and more.
Bubbles are big
When it comes to the bath fragrance and bubble bath subsegment, private label comes out on top, with a 25.4 percent share of the market, the Mintel report says. Here, store brands are not only in competition with national brands, but also are beating them at their game. Down the road, this subsegment could grow even further.
"[Retailers] have not really locked down hard on categories like high-fragrance, body mists [and] pretty packaged liquid soap," Rubin notes, "that are so successful in the specialty retailer category."
Essential Wholesale Labs' Kayla Fioravanti, chief formulator and registered aromatherapist for the Clackamas, Ore.-firm, agrees.
"The shower gel, bubble bath and liquid hand soap category is [a] wide-open field that offer[s] ample opportunity," she says, "for the store brand to be in line with the current trends as they are unfolding."
And the personal care industry as a whole, she feels, is shifting toward natural and "free" products — that is, paraben-free, sulfate-free, pesticide-free and more. Granted, the shift is coming about slowly, but at just the right speed for store brands to ride the natural wave.
Free and clear
Given the plethora of organic and natural certifying organizations with varying standards, retailers have not really seen past the high costs associated with traditional certification. Instead, Fioravanti says, they should take advantage of the lack of a universal stamp of approval and "create a store standard that their brands and the [national] brands that fill their shelf could reach."
Starting out small, as in small-sized packaging, is an affordable means for bringing natural products to retailer shelves, she points out. Another cost-effective strategy involves taking advantage of the various social media opportunities available, including Facebook, Twitter, blogs and YouTube, to promote store brand bath and body products.
Just this past October, for example, Pleasanton, Calif.-based Safeway announced the launch of the In-Kind natural personal care line of products on its official blog. The company's Facebook page and Twitter account also referenced the product launch and directed shoppers to the blog on its website. Although it is too soon to tell what impact the promotional method will have, it's safe to say that Safeway is reaching out first to its younger, media-savvy customers. A smart move, as they are a demographic that is more likely to try store brand or private label products in general, according to the Mintel report.
The In-Kind product line is not specifically targeted to younger shoppers, though. The line, which includes — among other items — body wash, hand and body lotions, and liquid hand soap, is packaged in a distinctive curvy bottle that comes in various muted shades. Every product is formulated with ingredients that are more than 90 percent natural and is free of paraben, sulfates, pesticides, etc. The products also boast clean fresh scents and claim to be highly effective.
Store brand bath and body products are finding success these days. But to maintain the current momentum, retailers will have to keep a close eye on consumer trends and preferences and find ways to stay in step with— if not one step ahead of— the national brands and even specialty retailer brands.
Do take advantage of the absence of a universal "stamp of approval" for natural and organic bath and body products by creating a store standard for your brands and others.
The $1 product trend and overall poor-quality products are being pared down.
Starting out small, as in small-sized packaging, is an affordable means for bringing natural products to retailer shelves.
Top 5 Markets for Bath and Body Products
- Memphis, Tenn./Miss./Ark., Metro
- Baton Rouge, La., Metro
- Birmingham, Hoover, Ala., Metro
- New Orleans, Metairie, Kenner, La., Metro
- Virginia Beach, Norfolk, Newport News, Va., Metro
Regions with the largest percentage of people with a tendency to buy store brand bath and body products, reported by Core Based Statistical Areas (CBSA) defined by the U.S. Office of Management and Budget.
Source: Buxton Co., Fort Worth, Texas.
Cleaner Handshakes, All-Around
According to the latest observational study sponsored by the American Society for Microbiology (ASM) and the American Cleaning Institute (ACI, formerly The Soap and Detergent Association), released on Sept. 13, 85 percent of adults now wash their hands in public restrooms, compared with 77 percent in 2007. That percentage is the highest observed since these studies began in 1996.
Moreover, in a separate telephone survey, 96 percent of adults claimed that they always wash their hands in public restrooms, a percentage that has remained relatively constant over the years. But New York-based Harris Interactive, on behalf of ASM and ACI, discreetly observed 6,028 adults in public restrooms in August to note whether or not people washed their hands. Researchers returned to six locations in four cities in which two previous studies were conducted: Atlanta (Turner Field), Chicago (the Museum of Science and Industry and the Shedd Aquarium), New York City (Grand Central Station and Penn Station), and San Francisco (the Ferry Terminal Farmers Market).
The findings? Men stepped up to the sink a bit more than they have in the past when it comes to public handwashing, ASM and ACI say. More than three-quarters of them (77 percent) washed their hands publicly in 2010 compared to only 66 percent in 2007. But women still came out ahead: 93 percent of those observed in 2010 washed their hands in public restrooms versus 88 percent in 2007.
