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PL can reach women with the right products and right packaging
The recession and Washington’s summer of budget and debt woes may continue to wreak havoc with overall consumer confidence, but there are a few things you can count on. “Women want to smell clean and pretty,” says Tom Raffy, president and head of technical sales for Gar Labs in Riverside, Calif. Since shiny, bouncy locks are an intrinsic mark of beauty in our society, he predicts that his private label haircare sales aren’t headed down any time soon. He’s expanded his business, adding a second shift and reports that his private label haircare products are flying off the shelves.
Not all haircare products are faring equally well. SymphonyIRI Group, Chicago, reports that for the 52 weeks ending June 12, 2011, total U.S. shampoo sales in supermarkets, drugstores and mass merchandisers (excluding Walmart) drifted up an anemic 2.1 percent to $1.4 billion from a year ago. Branded regular, or non-dandruff, shampoo sales were almost flat for this period, rising only 1.14 percent.
But private label shampoo sales soared almost 20 percent higher, to $31.3 million. Compared with the year before. Likewise, branded conditioner sales rose only 2.67 percent, while private label conditioner sales jumped 23.2 percent.
Haircare products, while used almost daily by a vast majority of the population, are still highly personal purchases. Women – and make no mistake, the power consumers in this category are women – will often switch brands or product lines faster than a hairstyle is declared the new look.
Indeed, according to Mintel’s research, one seemingly daunting fact for the national brand competition is that haircare products do not inspire brand loyalty. A woman may appear fickle as she moves between brands, whether the products or national or private label. Why does she do this? One big reason is that women are conditioned to switch shampoos.
Fashion magazines are awash with advice for women who lament their dull, unhealthy looking locks. The most common advice? Switch to a different shampoo to perk up your hair’s appearance. This built-in drive to eschew brand loyalty means that private label makers and sellers need to focus on something different to attract and retain their consumers as long as possible: results.
WHAT SHE WANTS
According to Mintel, women want a combination of the prosaic and virtuous. Its research shows that women say they first want a product in a package that can be easily opened, closed and poured with one hand; second, one that offers protection for their hair from the elements; third, packaging that is the right fit for the size of the tub or shower shelf or caddy where it will rest; and last, that the product hasn’t been tested on animals.
This might be what women answer on a survey but private label haircare product makers beg to differ. “Women want things that really work,” says Raffy.
Products that really work translates to those that help women achieve the look of the moment. These popular looks include the deliberately disheveled and seemingly casually pinned up hair that call for styling aids like spritzes and sprays - products that are outstripping sales of gels and mousses. Indeed, sales of private label hair spritzes and sprays rose 51 percent from a year ago while branded product sales rose less than one percent, according to IRI.
The other thing women want is a haircare product that markets itself as natural. Raffy says requests for natural haircare products from private label merchants have grown in the past two years.
“It’s all I get asked for,” he says, a bit incredulously. This trend towards the natural amazes him. “There’s nothing like the functionality of synthetic ingredients, which have been proved to be safe for the past 40 years,” he says of consumers eschewing haircare products they deem unnatural. “But no amount of scientific facts will convince them” that natural ingredients aren’t necessarily better for their hair, he says.
Indeed, a May 26, 2011 Euromonitor report notes that some critics have accused large haircare companies of “greenwashing their products with labels that have nothing to do with the actual ingredients.”
Sally Gagan, vice president of operations for Hayward, Wis.-based Beehive Botanicals, Inc. whose products are found mainly in health food stores, takes a more tempered view of the ability of natural to sell products. “People are willing to spend a little bit more on natural but not in the grocery store,” she says.
What can you do to improve sales to women whose buying patterns are often hard to predict?
Find the underserved niches in the haircare segment. Mintel suggests private label makers and retailers can market more specifically to older adults. Any private label haircare product that promises to help this group look a bit younger and keep their hair sexy looking can be a hit. Baby Boomers wield giant purchasing power – and an insatiable desire for products that tout their ability to sustain health and youth.
In addition, think hard about whom your packaging appeals to. The majority of haircare product ads feature women 18 to 24, who appear single, according to Mintel. When these consumers decide on a shampoo or conditioner, they’re influenced by a number of factors, including the product’s perceived benefits, its packaging, and recommendations from stylists, families and friends. Yet its women age 25 to 44 who are more likely to buy shampoo and conditioner, not just for themselves but also for other members of their family. They wield considerable purchase power and private label retailers ignore them at their peril.
And don’t ignore Hispanics who as a group spend more of their income on haircare products than other ethnic group. Their purchasing power will only continue to grow as they become one third of the U.S. population by mid-century. Lastly, Mintel notes that it could prove fruitful to appeal to men who are trying to up their sex appeal. So far, men’s haircare products are a tiny portion of the total market. But it could be that what women really want is a man with great-looking hair.
Eye on national brands
Unilever announced in August that it was selling its Alberto VO5 brand in the United States and Puerto Rico to a private equity firm. It bought the Alberto Culver Company in May for $3.7 billion.
Procter & Gamble earlier this year launched My Beauty Adviser, a free app for the iPhone and Android mobile platforms backed by its Clairol and Pantene hair care brands, among others.