UK Health and Beauty Retail Prospects Among 50+ Shoppers


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As the proportion of those in the 50+ age bracket rises, these customers become a core purchasing group and retailers must ensure their needs are understood and met. An ageing population means consumers' needs are changing and innovation in the market makes it a high-paced sector. Learn what the changes are in this sector over the next five years and where the opportunities lie.

Verdict is offering a FREE case study highlighting where the health & beauty opportunities lie by category, channel and region.

The full Verdict report Health & Beauty Retailing in the UK offers data and forecasts to demonstrate which players pose a threat over the next five years.

Key questions answered:

Which areas of health & beauty are exceeding expectations, and which are suffering?

Which retailers are the winners and losers in health & beauty?

Which are the key demographics for health & beauty retailers to be targeting and how will this change over the next five years?

What are the key trends in health & beauty retailing? How can I capitalise on them?

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UK Health and Beauty Retail Prospects Among 50+ Shoppers

  1. 1. think retail thinkUK Health& Beauty RetailProspects Among50+ ShoppersAgeing population to propelgrowth in health & beauty retailCase Study:
  2. 2. YearSales – Currentprices £mYear-on-yearchange %2013e 19,224 2.62014e 19,755 2.82015e 20,441 3.52016e 21,055 3.02017e 21,705 3.1• South West• South East• Eastern England• Skincare• OTC Medicines• Dental CareBy Category• Online• Local Pharmacies• GrocersBy ChannelBy RegionWhere are the opportunities?• 50+ age bracket will represent 37.3% of thepopulation by 2016• In 2011, 55+ represented 25.8% of onlineshoppers, and this is set to increase• Disposable incomes relatively low• Tend to shop at local pharmaciesDecember 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 2Figure 1: Health & beauty sales forecastsFigure 2: UK’s ageing shoppersHealth & beauty market set for growth in next five yearsThe health & beauty retail sector has been somewhat of a shining light in current retailtrading conditions and is unlikely to dim.Verdict forecasts the sector’s sales to grow by £3 billion in the five years to 2017.Consumers will be more reluctant to cut back on health & beauty spending in areassuch as skincare and cosmetics, so there is room for retailers to push their prices up onpremium and upper midmarket products without impacting on volumes. Some health& beauty products have an essential role to play in everyday lives, which keeps volumeshigh but price competition remains. Meanwhile even higher end health & beautyproducts can be bought as a ‘treat’ purchase without consumers having to part with toomuch money, so these may be alternatives to more luxurious purchases as consumerconfidence remains low.The ageing population may be arepetitive phrase but it is a driver inthe health & beauty sector’s continuedgrowth. Heightened concern overlooking younger, combined with anincreased need for medicinal anddental products, means that shoppersaged 50+ - which will represent morethan one-third of the UK populationby 2016 - will become increasinglyimportant to retailers in this space.Therefore, those that accommodatethis demographic, both with the typesof products on offer and the channelsthey use to sell them, will make themost of a significant opportunity.Source: Shopping Centers in Europe2012,Verdict ResearchSource:Verdict Research
  3. 3. 01020304050Health&beautymarketsales(%)2008 2009 2010 2011 2012f 2013f 2014f 2015f 2016f 2017fFigure 3: Grocers’ share of health & beauty market sales (%)Source: Health & Beauty Retailing in the UK,Verdict ResearchDecember 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 3Where shoppers aged 50+ will buy health & beauty productsAn ageing population has huge implications for where and how we buy health & beautyproducts. The growth of the 70+ age bracket means a higher proportion of consumerswill become less mobile, and will choose more accessible and convenient shoppingchannels.Pharmacies, online shops and supermarkets/grocers are most likely to benefit.Pharmacies will increasingly focus on the health side of the sector, as the growth ofonline shopping means a lesser need for beauty products in these outlets, and thereare many opportunities here for differentiation. Offering services such as blood pressureand cholesterol checks alongside strong customer service and a wide range of healthproducts will help entice shoppers.Pharmacy store numbers have risen dramatically over the past five years, and areset to hit 14,500 by the end of 2012, a rise of 6.3% on 2011. There has been an influxin supermarket pharmacy numbers over the year to 2012, with a rise of 7.6%, whilestore numbers among leading specialists such as Boots, Lloyds Pharmacy, Rowlands,Superdrug and The Co-operative Pharmacy, are expected to remain static this year.Pharmacies are not the only benefits to shopping for health & beauty products insupermarkets. Grocers or supermarket chains have already seen a healthy increasein their share of the market and Verdict expects this to continue. The convenience ofadding everyday health & beauty products to the regular food shop, such as toothpasteand deodorant, coupled with growth in online grocery shopping will continue to appealto those wanting an easy shopping experience, with shoppers aged 50+ feeling aparticular resonance.To further capitalise on their increasing popularity, grocers should consider broadeningtheir selection to more brands and product ranges, and expanding in-store pharmacyservices, such as blood pressure checks and flu jabs, to better serve the UK’s ageingpopulation.
  4. 4. December 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 4Online opportunities in health & beautyOnline, while slowing in growth, is set to become an ever-more important shoppingdestination in the sector. In 2012, 4.9% (£919.1m) of the total health & beauty spend willbe online, and this is set to rise to 6.9% in 2016 to reach almost £1.5bn.Despite the sensory nature of shopping for health & beauty products, greater ranges,convenience and low prices signify opportunities for online retail, as well as the factthat once shoppers are happy with a store-bought product, the benefits of shoppingonline will give them more confidence to buy said product through that channel. Inaddition, the growth of online supermarket shopping will play its part. As consumerscontinue to buy some of their health & beauty products at grocers, at a growing rate,this will translate to simply putting these products into their regular online groceryshopping basket.Online shopping will continually become attractive to shoppers aged 50+. This agegroup is becoming more tech savvy, and the meteoric rise in the popularity of tabletswill offer a more accessible shopping experience than a PC or laptop, meaning thosethat have not in the past been used to computers will find tablets more appealing.Verdict’s e-Retail in the UK 2012 research showed that across all age groups, 22.0% ofonline health & beauty product shoppers in 2011 used a mobile phone to buy goods,while 11.0% did so via a tablet. Retailers should therefore optimise their sites formobile browsers or develop a transactional app for smartphones and tablets. Mobileoptimisation is the most important of these – as an easy-to-use mobile website willbenefit retailers and is a great deterrent for moving to a competitor.There is no getting away from the fact that physical stores are still important to thesector, indeed continuing to account for the vast majority of sales. The senses play acrucial role in the buying decision surrounding these types of products, something thatshopping online cannot get around. To continue to combat any online push, alongsideaggressive pricing retailers could combat this with exclusive in-store products andranges. Boots offers Kings male grooming products in-store. Complimentary serviceswill also be a draw – for example, those NHS health services at Boots and the spaservices at Neal’s Yard and certain branches of Lush.Therefore, it is worth looking at regions with a higher proportion of shoppers aged50+, but with enough disposable income to encourage spending. For example, theNorth East has the second highest proportion of consumers aged 50+ in its population,but the lowest average weekly expenditure per person. However, the southern regions(East, South East and South West) have relatively high levels of both, so opportunitiesdefinitely lay in these areas.
  5. 5. Figure 4: Spending in health and beauty categories in next five yearsCategorySpending £m (% annual growth)2013 2014 2015 2016 2017Dental care 882 (2.2) 902 (2.3) 927 (2.8) 951 (2.5) 976 (2.7)OTC medicines 2,678 (3.2) 2,767 (3.3) 2,886 (4.3) 2,995 (3.8) 3,115 (4.0)Skincare 2,301 (3.4) 2,389 (3.8) 2,489 (4.2) 2,584 (3.8) 2,687 (4.0)Source: Health & Beauty Retailing in the UK,Verdict ResearchDecember 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 5Ageing population provides healthy opportunities forcertain categoriesCertain health & beauty products will undoubtedly benefit from the rise in shoppersaged 50+. Dental care will grow steadily over the next five years as the ageingpopulation boosts a requirement for dentures and associated products, whilecontinued promotion and advancement of teeth whitening will also drive dental sales.Meanwhile, over-the-counter medicines already have a solid revenue stream due totheir necessity across all age groups, but they will also benefit from this demographicas demand grows for vitamin and mineral supplements.The 50+ shopper is not just concerned with a necessity to keep healthy and functional.Consumers of all ages are increasingly concerned with looking younger and halting theageing process – and this is marked in the 50+ age group. Women in their 50s todayare dressing and wanting to look younger than those aged 50+ 20 years ago, and thetrend is expected to continue with more emphasis on anti-ageing products, cosmeticsurgery and hair plugs.
  6. 6. December 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 6This case study was taken from Health & Beauty Retailing in the UK, VerdictMarket ReportFor more information on this report please email, or call +44 (0)20 7551 9664IntroductionDespite the continued economic pressure, health & beauty has remained relativelyresilient and provides opportunities for growth. An ageing population meansconsumers needs are changing and innovation in the market makes it a high pacedsector. Learn what the changes are in this sector over the next five years and where theopportunities lie.Features and benefits■ Discover our comprehensive analysis of the key issues set to impact the health &beauty market over the next five years.■ Use our market sizing and growth rates broken down by categories including skincare,cosmetics, babycare and OTC medicines to plan future strategies.■ Learn who will be gaining market share and who will be losing it.HighlightsWhile volumes will be slightly impacted by consumers making more consideredpurchases the sector remains fairly resilient. Low selling prices, increasing concernsaround looks and a necessity element to some products keeps shoppers buying.As grocers and general merchandisers take more share, specialists need to giveconsumers a reason to shop with them. Own label ranges, alongside loyalty schemesand a unique shopping experience (offering free makeovers or special beauty days withdiscounts) should help fight off competition.Retailers need to ensure websites are mobile optimised and are easy to navigate orapps are provided to provide a positive brand experience. While mobile payment isin its infancy in the UK, it is something which retailers will need to consider over thecoming year.Your key questions answered■ Which areas of health & beauty are exceeding expectations, and which are suffering?■ What channels are gaining share and which are struggling?■ How are Health & Beauty specialists performing compared to the total health &beauty market?
  7. 7. December 2012UK Health & Beauty Retail Prospects Among 50+ Shoppers page 7About VerdictVerdict is a retail information specialist within the Informa Group. With almost 30 years’experience, Verdict publishes unrivalled independent analysis. We provide a completepicture of the UK and increasingly the international retail arena, helping retailers,manufacturers, service suppliers, analysts and consultants to fully exploit opportunitieswithin the