As customers prioritize health, c-stores are offering shoppers more health and beauty aid (HBA) choices, including products infused with cannabidiol (CBD).
HBAs in the c-store channel provide an irresistible combination of consumer motivators: the convenience people want and the products they need. From health maintenance to cosmetics, the magnets drawing consumers to the HBA shelves work in tandem — together with strong retailing practices — to create a dynamic department.
But competition from other channels, including grocery, drug and dollar stores, means c-stores need to up their game to stay relevant in the category.
For Tom Dix, buyer for Dandy Mini Marts Inc., which operates 65 locations throughout the Twin Tiers region of Pennsylvania and New York, dollar stores pose the biggest competitive threat for the HBA category.
“The biggest problems are Dollar General and Family Dollar,” Dix said. To woo customers away from these dollar store giants, “we’re trying to go with more two- and four-pack name-brand peg (HBA items) and with private-label in bigger sizes.”
By the Numbers
Despite heated competition, sales figures illustrate the category’s strength in convenience stores.
Market research firm IRI’s all scan convenience store data for the latest 52 weeks ending July 14, 2019, show cold, allergy and sinus tablets dollar sales of $158 million, an increase of 5.9%. Meanwhile cold, allergy and sinus liquids/powders garnered $39.6 million in sales, up 2.9%.
On the beauty front, lip cosmetics sales climbed during the 52-week period, with dollar sales up 5.8% and unit sales growing 29.9%. Within the segment, lipstick saw unit sales up 38.5%, while lip treatments increased 218.2% in dollar sales and 216.3% in unit sales.
Eye cosmetics saw a unit sales uptick of 7.6%. Unit sales of mascara were up 12.8%, while eyebrow makeup unit sales climbed by 21.7%.
Today’s consumers are taking better care of themselves, said Erin King, senior category manager for 7-Eleven Inc.
“Trends are moving toward more fitness, better eating and consumption of vitamins and dietary supplements to aid in the healthy maintenance of the body,” King said.
HBA sales can vary in multiple ways, King noted. “Our standard HBA set is 12 feet; however, some stores have limited space, which means the HBA set can be as small as four feet.”
There is also a regional play, King said. “Some brands do better in specific parts of the country; for example, BC Powder vs. Goody’s Powder. Customers are very specific about which brand they prefer, which varies regionally.”
Sales can also vary based on the customer profile, King added, and items should be merchandised within the section to meet those specific customer needs.
7-Eleven’s take on increasing HBA volume is simply to provide shoppers with more choices.
“To increase HBA sales,” King said, “expanding the assortment and giving additional space to the category is a good place to start.”
The 2018 federal “Farm Bill” legalized the production of hemp, which essentially legalized CBD on the federal level. The result has been more HBA products featuring CBD, which is touted as having pain-management and calming properties.
“CBD is the hottest product (in HBA) right now,” said Mike Jackson, category manager for Baltimore-based High’s, which operates 49 c-stores in Mid-Atlantic states. “Since it is fairly new to the c-store market, sales are growing exponentially each week. I think greater customer awareness and knowledge have also contributed to increased sales of CBD.”
Jackson has found that HBA tends to be a customer-need-driven category.
“If the customer comes into the store with a headache, runny nose, etc., they generally go looking for something for immediate relief.”
That said, he added, merchandising seasonally-driven products near the point-of-sale (POS) ensures customers see the product and may purchase immediately instead of waiting to visit a larger retailer.
Jackson recommended c-store operators carry multiple-dose packs.
“Make sure the retails are not too outrageous as to make the customer feel they are being taken advantage of when making a purchase,” he said.
Selling only single-dose travel packs limits who will purchase the product, he added.
“Someone traveling will know they will need at least a second dose that day to relieve the symptoms, so if you only have single dose retail packs, they may wait to purchase the product from somewhere else rather than buying multiple single-dose packs.”