July 1, 2009
Think personal care products only look good in small packages? Think again. An October 2008 Nielsen study showed that when it comes to consumer packaged goods, 47 percent of consumers preferred large sizes with lower price points per ounce.
"Many consumers are looking for ways to pinch their pennies but don't want to make sacrifices when it comes to their healthy lifestyles," says Laura Setzfand, vice president of marketing and communications for Nature's Gate, a natural PC company based in Chatsworth, Calif., which recently launched 32-ounce economy sizes.
Other PC manufacturers, such as Alba Botanica and EO, are reporting strong sales of their larger sizes.
"When we debuted our 32-ounce soap two years ago, sales exceeded demand in three months," says Brad Black, EO's cofounder. The company, which is based in Corte Madera, Calif., offers upsized hand soaps, shower gels and lotions based on retailer feedback.
Monetary value aside, less packaging also translates to less environmental impact. "Buying in bulk generally uses less packaging," says Anne Bedarf, project manager for the Sustainable Packaging Coalition, a nonprofit organization based in Charlottesville, Virg. And it takes the same amount of energy to create a 32-ounce bottle as it does a 12-ounce one, Black says. A downside? Retailers need to find room to store large bottles and tubs. "The biggest challenge is shelf space," says Sarah Galusha, group category manager for Alba Botanica. Because retailers tend to offer a wide variety of PC products, she says, it's a big space commitment to stock two sizes of one item. Still, even when economy sizes have to be squeezed onto bottom shelves or endcaps, customers seem willing to search out the best deals, especially for commodities—even if the initial investment is intimidating.
Natural products retailers shouldn't worried about taking on the risk of economy sizes, says Laurence Batterton, president of San Francisco-based Batterton Brokerage."Customers who want natural personal care products are not going to be shopping for personal care in mass markets anyway. They're already geared toward purchasing a product that is cleaner, and they still want that extra value."
That said, bigger isn't better for everyone. "Not every consumer will want to purchase a large size," says Setzfand, especially if that person is new to the product. Galusha agrees: "Only very loyal customers are going to buy value sizes." But for brand-loyal PC consumers, bigger can be better.
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