This reporter has attended most of the National Association of Chain Drug Store Annual meetings since 1984. In those days, it was an opulent affair. Men wore tuxedos and women gowns to the opening Saturday night top executive dinner (a Judith Leiber handbag was the gift one year — I stupidly gave it to a friend).
There were hundreds of drugstore chains in attendance such as Peoples, Gray, Revco and Longs — names now gone from the landscape. The mood was always jovial and although some chains competed against each other, they were friendly foes and shared ideas. Revlon even had two nights for its luxurious dinner (held at locales such as the Ritz Carlton and Mar-a-Lago) to find room for all the chains.
Fast-forward to a few years ago and consolidation had sapped the number of chains and the economy shattered the spirit. The Saturday night dinner was abolished in favor of a more democratic opening reception for all attendees. Revlon reduced its dinner to one night and cocktails and appetizers.
Although NACDS never lost its glamour, the mood for a few years was one of worry for the health of the industry.
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Good news for 2012. The spark is back. Attendees were glad to be back at The Breakers Hotel after a year in Arizona. By no means do executives think the industry is out of the woods, but there were smiles on retailers’ faces and hope in the eyes of manufacturers. The cocktail parties were livelier and yes — more drinks were flowing. L’Oréal’s festivities in particular were once again crowded and the group stayed for the entire event.
A few factors contributed to the buoyant mood. These included:
• An upswing in overall beauty sales averaging 3 to 4 percent with nail in the double digits.
• Consumers finding drugstores a good value for beauty meaning shoppers are not returning in droves to other options despite an improving economy.
• Manufacturers finding growth can come from expanding options such as dollar stores and wholesale clubs.
• Actions taken by fragrance firms such as Coty to revive excitement in store for fragrances.
• New products including at-home nail gel kits and technologically improved skin care, such as BB creams.
• A focus on merging the health image of the “back end” of the drugstore with the “front end.” This positions drug chains as a total health- and beauty-care provider.
• The emergence of more products and even store formats that serve multicultural shopping needs.
• A shattering of price points. While Jim Wuest, vice president of marketing for Kinney Drugs Inc., said there is a magic price point of around $20, there are product categories such as skin care that shoppers are willing to spend more than $40 for even in drugstore chains.
• An elevation in the look of drug chains such as Lewis, Walgreens and London Drug. London Drug continues to improve its ambience, which fits brands it sells such as Lancôme and Clarins.
People, Places and Things
A few words with Markwins’ Bill George, chief operations officer, chatting under the umbrellas in Palm Beach about the company’s recent growth.
WWDBeautyNews: What is your message at the meeting?
Bill George: We are discussing our laser-focus on this business. We had been sidetracked before, but devoted our strategy this year to our core businesses. Our Black Radiance is number one according to Nielsen in ethnic cosmetics. With Wet ‘n’ Wild, we have had 16 months of double-digit growth. We have made it easier to shop and find products — we used to make people search for them.
WWDBeautyNews: Tell us about Fergie and other promotional plans.
B.G.: Our audience is reacting so positively to Fergie. When we tested out personalities, we were so amazed at the broad reach she has. She has more than six million “likes” on Facebook. She brings in some consumers who maybe haven’t purchased Wet ‘n’ Wild.
We are also responding to consumer demand for value by doing our first coupon, for $1 off. We tested it with success so are offering one in May.
What’s in Store
Kiss Products Adds New Patterns: Hot off the success of its Impress nails, Kiss is adding jewel-patterned nail stickers that can go on natural nails or on the Impress nails.
Greg Wasson Takes Over the Helm: Walgreens’ Wasson is the new chairman of NACDS and one of the goals he’s most excited about is planning for next year’s debut of the Total Store Expo, which will be held Aug. 10 to 13 in Las Vegas. Total Store combines the Marketplace Conference, the Pharmacy and Technology Conference and the Supply Chain & Logistics Conference.