Brand Packaging

A New Prescription for Drugstores

By Todd Maute

Visiting your local drugstore, you almost always find the usual suspects: cold medicine, diapers, seasonal goods, personal care items and cleaning products. But you’ve probably noticed that there’s a whole lot more going on at major drugstore retailers than there used to be.

That’s because drugstores are starting to revamp their beauty and food offerings in an effort to give consumers more reasons to come in their stores more frequently. In fact, they’re adding so many services that you may have mistaken your local pharmacy for your local convenience store, beauty store or even grocery store.

Why? Quite simply, retailers have recognized that their investment in prime real estate can bring about more dividends if they place greater emphasis on building a deeper relationship with the consumer outside of their regular prescription needs. Shopping behavior continues to be a moving target-one that can vary depending on market, demographics or category-so drugstores are leveraging their proximity to capture shoppers’ attention, and are using assortment to drive trip frequency and increase basket size.

This trend has them focusing on private label solutions-many times in categories they have never been in-to uniquely address consumers’ needs for convenience, quality and value. It is also inspiring retailers and manufacturers to partner more strategically to drive the development of innovative products that are thoughtfully branded, elegantly packaged and merchandised with pride.

Exclusive, upscale beauty

Take, for example, beauty. Drugstores are elevating these offerings to compete with major retailers and, even, department stores. Duane Reade has developed an elaborate beauty department called the LOOK Boutique, which features exclusive and upscale beauty lines and cosmetologists who walk around in white lab coats, offering help and making recommendations. Additionally, some stores offer shoppers manicures or pedicures (choosing a color from high-end brands like Essie and Butter), and salon services like blowouts and scalp massages.

Shopper’s Drug Mart in Canada has also escalated the look of its in-store beauty boutiques and its stand-alone Murale “store-within-a-store” concept and it has launched Baléa, an exclusive line of hair and skin care products with seven sub-brands that range from facial wipes and lip balms to shampoos, body lotions and foot creams.

CVS has joined the ranks by introducing Lumene, an import brand from Finland that is sold exclusively at CVS stores. The retailer’s once-premium line, Essence of Beauty, has been largely superseded by Lumene in the creams and lotions segment, but the store has transformed Essence of Beauty into EB Essentials, a line of aromatherapy bath crystals and body lotions, sprays and washes. Additionally, the retailer recently launched Nuance, Salma Hayek’s line of more than 100 skincare, haircare

Beyond basic foods

Beyond beauty, drugstores are also beefing up their fresh and packaged food offerings-a smart strategy to boost frequency, considering that people shop for food on average about two-and-a-half times a week, compared with once a month or so for a drugstore or mass merchant.

And these are not just your basic food offerings. At a Duane Reade store in an upscale area of Brooklyn, for example, the food section looks like a gourmet grocery, offering six varieties of cage-free eggs, gnocchi, shitake mushrooms and mochi ice cream balls, while Duane Reade’s new Wall Street location offers sushi and juice bars. The drugstore’s parent company, Walgreens, ramped up its stores’ fresh food offerings to include meats, wraps, soups and other on-the-go meal options, as well as fresh produce.

CVS is getting in on the game, too, with its new Just the Basics private label food line. Across the pond, beloved British drugstore chain Boots has a wide variety of fresh food offerings, including the low-calorie Shapers lunchtime food, drink and snacking products and a line that caters to people struggling with diabetes and other weight-related illnesses. Monoprix also has several private label food lines, including the basic Monoprix label; Monoprix Bio, which encompasses eco-friendly all-natural food products; and Monoprix Gourmet and Grande Tradition Gourmet, which includes fine wines and specialty foods such as chocolates, coffee, cheeses, cured meats, and premium meat, fish, and poultry products.

It is clear that fresh and convenient food offerings, higher end beauty care solutions and strategically developed private label offerings are the wave of the future for drugstores. My guess is that, going forward, drugstores will continue to leverage unique offerings and their prime locations to capture consumer attention. We will see retailers who have not traditionally been powerhouses in the food, fresh and high-end personal care categories become forces with which to reckon. Grocery stores beware…there is new competition in town and it’s on almost every corner in America!

Todd Maute is a partner at New York-based strategic branding agency CBX (www.cbx.com), where he is responsible for building retail brands for clients across a number of trade channels including: grocery, drug, discount department stores, pet specialty, consumer electronics, convenience, foodservice, office products, warehouse clubs and auto aftermarket. He can be contacted at: todd@cbx.com.