There’s no doubt about it: The natural and organic personal care (NOPC) industry is growing, now valued at close to $9 billion with consistent year-over-year high single-digit growth, according to Nutrition Business Journal. But is this growth necessarily a boon for independent natural retailers and small beauty brands?
“Large victories” for the natural personal care space—think major conventional manufacturers reformulating, legislation acknowledging cosmetics safety, or mass retailers stocking safer alternatives—can translate to more competition for naturals, as these products become more widely available. How, then, can independent retailers ensure their health and beauty aids (HABA) departments are reaping the benefits of the recent boost in sales and awareness of natural personal care?
You don’t have to be a “numbers person” to see the significance in these digits. Natural and specialty retail captured the most NOPC sales in 2011 with $2.5 billion of the nearly $9 billion NOPC industry, reports NBJ. However, mass-market retail was nipping at its heels with $1.8 billion, despite, according to new research from the Campaign for Safe cosmetics, being slow (very slow) to embrace safe cosmetics policies.
Department stores/boutiques/salons/and spas, which make up a huge portion of the beauty industry (salons and spas alone are a $40 billion dollar biz), have barely begun to tap into the natural and organic space, yet still captured nearly $1 billion of the $9 billion NOPC industry.
How it adds up: As the mainstream puts more efforts and resources into the space, natural retailers must do the same to hold on to—and grow—natural beauty sales.
The importance of merchandising
So what do natural retailers do best? Of course, the larger selection of NOPC products is key to maintaining an edge over conventional retailers, which are still largely comprised of conventional products.
Beyond selection, there’s still room for improvement to compete with the shopping experience provided—whether that’s the affordability of drugstore brands or the luxury experience at spas, salons and department stores. I think natural retailers have the opportunity to reach both demographics. Smart category management can help ensure shelves are stocked with a range of prices.
Natural retailers may also want to focus on adding in more merchandising elements, such as proper lighting, well-maintained sampling options and accessible in-aisle resources that can help compete with salons and department stores. Knowing your customers is important to determining the best approach to stocking the deparment. Regardless, poducts should be stocked wisely—as to not confuse or overwhelm consumers. I think there’s also a big opportunity to cross-merchandise beauty products with supplements to capitalize on informed, health-oriented consumers.
We’ll cover this topic in depth at Natural Products Expo West’s "Managing your HABA department" education session.
Education remains key
This conundrum isn’t exclusive to personal care. But as a newer category to gain growth and awareness in the natural space (according to many of the retailers we have spoken with, consumers will start with natural and organic food before transitioning to the HABA department), education efforts seem most important to gaining a loyal customer base.
If most of your customers still aren’t entering your HABA department, that’s a missed opportunity. You must ask yourself: Is my department growing along with the category? Can your current on-staff experts help answer questions, make recommendations for skin and body types and help clear up confusion related to ingredients and claims? Do you have resources to hire one HABA-specific expert to bring a new customer on board?
Even as mass retailers increase their natural offerings—can they offer this added value?
Retailers, how are you capturing sales of the growing NOPC space in your HABA departments?