Chain Drug Growth Opens Opportunities For Housewares

SAN DIEGO— The drug store channel fared better than some other retail channels during the recession, according to Larry Lotridge, vp/conference services for the National Association of Chain Drug Stores, because these retailers sell essential products consumers need for their health, beauty and wellness.
According to the U.S. Census Bureau data, drug stores saw 3.4% growth from 2008 to 2009, or $210,985 billion in sales in 2008 to $218,219 billion in 2009. This year’s sold-out NACDS Marketplace, held at the San Diego Convention Center, here, is another sign, according to Lotridge, that the economy is recovering.
“Historically, our industry is less affected [by a tough economy]. People need to have their personal care or household items. The economic times were a challenge for everybody, but we tend to weather the storm better. We’re not non-essential high-end luxury items; that is what people cut in tough economic times,” said Lotridge. “Our industry has a combination of products that everyone is going to need and everyone is going to use.” The necessities consumers use for everyday personal and household activities such as bathing and showering and surface and floor cleaning, as well as products needed for everyday health, such as vitamins and prescription drugs, drive traffic to the stores, according to Lotridge.
The wait between drop-off and pick-up of prescriptions also often provides an added window of opportunity to entice consumers with an impulse buy of something they need to provide a quick, affordable solution in their home, such as As Seen on TV products or promotional seasonal housewares products, such as melamine tableware, coolers and personal fans.
One theme that has grown at the national chain drug store channel level is “a wholistic approach to health and wellness,” said Lotridge. “Vitamins and nutrition, what they need to stay well, and natural products, goes hand in hand with the pharmacy.” Items that could previously only be found in a specialized health food store are now found in an increasing number of chain drug stores’ doors, he said.
Part of this wellness movement, he said, is not only focusing on what people consume, but also their surroundings. For example, a growing category in the channel is eco-friendly or all-natural cleaning products, popular because of both consumers’ concerns over their environmental impact but also because these consumers do not wish to bring conventional cleaners and their harsh chemicals into the home, he said. Reusable shopping bags and hydration bottles are also new product trends found at drug stores that contribute to this health/environmental impact theme. Items that improve the health in the home environment, such as humidifiers, are also often merchandised with other wellness products at chain drug stores.
While overall drug store sales grew from 2008 to 2009, there was a drop in sales in household/home goods items, when factoring in drug, mass and grocery stores, according to AC Nielsen, sales were $20.9 billion in 2009 and $21.3 billion in 2008. This data includes prepackaged, UPC-coded products only.