NATIONAL REPORT — Health and beauty care (HBC) is enjoying new respect in the convenience channel. Once overlooked, the category has gained more attention since the onset of the COVID-19 pandemic, leading consumers to look at convenience stores differently.
“When convenience stores were considered essential businesses during the pandemic, they were often among the only places consumers turned to meet their daily needs,” said Michelle Ridder, director of category management for Lil’ Drug Store. Products Inc., based in Cedar Rapids, Iowa. “Now that consumers know [health and beauty care] can be found in convenience stores, we suspect some will stick with this habit.
According to Katherine Policelli, business analyst at Cadent Consulting Group, based in Wilton, Conn., the initial hook was needs-based products. Consumers who have a need and need an immediate solution, such as an over-the-counter drug, skin care product or shampoo are the logical target for the HBC convenience store, she said. Convenience store news. “These products offer the best opportunity to increase category margin for convenience stores.”
HBC’s average sales per store rose 4.2% in 2020, compared to 1.3% growth by category in 2019, according to the latest Convenience Store News Industry Report. HBC’s segments with the strongest growth in convenience store sales included toiletries, vitamins/supplements, and cough/cold remedies.
But that only tells part of the story, especially now that convenience stores have embraced the more mainstream HBC category trends. And industry experts have ideas for how they can capitalize on the recent momentum and maintain sales growth.
Performers with endurance
HBC Sustainable items include both core and non-traditional segments.
First, there has been an “increased reliance on HBC staples,” according to Policelli. Cadent Consulting gives high marks to key areas such as pain relievers, lip balms, antacids, cough/cold medications and family planning.
“Some of them are just an impulse buy/basket builder, like lip balm, and some can be very price competitive, like family planning items, but still offer a big margin,” explained the analyst.
Ridder noted that allergy-related sales continue to see double-digit growth as consumers “more proactively deal with allergy symptoms to avoid the stigma of coughing or sneezing in public during the pandemic.”
Additionally, category experts say these product trends and attributes should be on convenience retailers‘ radar if they’re serious about increasing HBC sales:
- Personal Protective Equipment (PPE)
- Home test kits
- Immune Health
- Long-term well-being
- Personal care and personal care at home
- Aids to relaxation
- Digestive support
- Localized beauty treatments
- CBD-infused tinctures and balms
- Essential oils
- OTC Basics
- Sun care as skin care
- better for you
Although convenience stores are not pharmacies, they are learning to give a more reliable image of over-the-counter medications and other health-related items. This can be facilitated by stocking both a leading brand in each segment and a private label offering, according to Policelli. This approach offers a range of quality and value, spanning the spectrum of most health-focused categories, she said, adding that this “one plus one” strategy is particularly important in more rural settings where convenience stores often become the local one-stop shop. store.
Ridder of Lil’ Drug Store Products agrees that convenience stores should carry top-selling HBC items in a variety of sizes and price points, as well as house brands where it makes sense.
She also pointed out that with COVID-19 variants of great concern these days, maintaining pandemic safety precautions in-store and promoting them to customers is another way for convenience stores to better compete with the channel. pharmacies.
When it comes to in-store placement, Jim Beghtol, senior category manager for Lil’ Drug Store Products, believes that HBC belongs in a centralized location, but also in secondary locations that feature consumer values and new product launches. items. “This will continue to drive category awareness and earnings,” he said.
Going forward, Beghtol encourages convenience stores to embrace “the new normal” and expect many of the new habits created during the pandemic to carry over after the crisis.
The key takeaway is that convenience store consumers have become HBC’s captive audience — and they likely won’t back down if retailers maintain momentum.
The best care for the HBC category
Industry experts offer these latest tips for convenience stores to increase HBC sales:
- Increase awareness. Let consumers know HBC is “in the house” through signage, promotions, loyalty and placement. Understand and transmit an increased interest in health, driven by the pandemic.
- Be well surrounded. Offer top-selling HBC SKUs in immediate consumer sizes and allow customers to trade in larger size SKUs to increase market basket. Offer private label SKUs where it makes sense.
- Manage category. Assign an HBC Category Manager at the retail level to work with Supplier Category Managers to ensure the best products are included in bundles. Use vendors for category information.
- Sprinkle relevant terminology. Create a wellness destination section, planogram or endcap in the store. Use loyalty programs to reinforce “Wellness” and “Better for you” offers.
- Manage message. Categorical messaging in store, on social networks, at the pump, etc. must be simple and educational without any health claims.
- Embrace the new normal. Yes, there has been an increased reliance on basic HBC products, such as painkillers, antacids, cough/cold, and lip balm. But we also understand better now that certain “manias” of HBC turn out to be modern solutions to classic problems. Offer both sides of the spectrum.