Home » Technology Is the Key for the Future of General Merchandise
Feature National Nonfood Items

Technology Is the Key for the Future of General Merchandise

Last updated on June 6th, 2016 at 04:07 pm

by Ashley Bates/staff writer

Dave McConnell, president and CEO of the Global Market and Development Center (GMDC), says the future of general merchandise and health and beauty care centers on tech­nology and focusing on sales throughout the food channel.

GM/HBC chartIn the recent study released by the organization, “Consumer Shopping Habits for Wellness and Environmentally Conscious Lifestyles,” the GMDC found that smartphones are used for health, beauty and wellness shopping by three out of 10 consumers (31 percent) and about two out of 10 smartphone users ­regularly make a purchase on their smartphone (21 percent).

Also, seven out of 10 consumers have made an online ­purchase for health, beauty and wellness products in the past three months, the study said.

The proportion of consumers using natural or organic body care products for longer than one year increased to 79 ­percent in 2009. Consumers initially begin using natural or organic hair and skin care because of their healthier ­perception.

These findings are what McConnell sees as the future of the industry, and it’s time for retailers to offer mobile products and services to enhance the shoppers experience and sell the ­products they want to buy.

“We are trying to identify new opportunities for our ­retailers, ­trying to identify where consumers are trending in the purchase of these types of products, particularly in the food channel,” McConnell said.

“We’re an association that crosses channels, but 85 percent of our members are tied to the food channel so we’re ­really a food-­focused organization. The key elements of what we found this time was a little different; we delved a little deeper this year and looked at natural, beauty and the impact of technology. We think mobile technology is a real key to connect consumers with their retailers around health and wellness issues, particularly among younger customers. We also find that more and more consumers are embracing the concept of looking for more comprehensive brands and ­services from their pharmacy to help manage their health and wellness needs, and this data helps support that.”

In the third year of the study, the GMDC found that overall there have been consistent patterns with consumers. Some of the main findings are that “the top two health ‘conditions’ are being ‘overweight’ and ‘stress,’ which are more general and lifestyle-oriented than specific, acute medical conditions,” and “the internet and doctors are the top used H+W information sources for all years.”

“What we are finding is that (consumers) are very deeply involved in health and wellness, and that trend continues. We are also finding in the beauty products category that consumers are willing to pay a little more for natural products that help give them more personal benefits,” McConnell said. They are pleased when these “can enhance their look and they feel like they are using healthy products that not only take care of their health needs but their beauty needs. That creates some opportunities for the food channel,” he added.

McConnell pointed to several food retailers that are ­grasping these opportunities, including Hy-Vee and H-E-B.

“What’s interesting is that we went through a period in the 2000s, just before the recession hit in 2008, when CPG ­(consumer packaged goods) was really focused on their top eight, top 10 customers, and as we’ve gone through this turbulent economic time, CPG companies in particular have looked back and looked at our membership and looked at the fantastic regional members and quasi-national and national food ­channel. They are the ones that have the flexibility to be ­innovative and try new things,” he said. “Hy-Vee is a great ­example of a company that is establishing themselves in the marketplace as the health and wellness destination for their consumers. H-E-B is very innovative as well. They do so many different things, and they market so well. In the GM/HBC area…they have developed an incredible housewares ­program that is their own brand.”

H-E-B sells fashionable and stylish small private label ­appliances in its stores that have become a staple to some shoppers.

“You have to have a good mix of national brands, too. Shoppers know brands, they know what they want to cook with and prepare with and you have to make sure you have a nice mix of both,” McConnell said. “Store brands are really key. We are big on an effective mix of both to really meet the needs for consumers.”

In the health and beauty care category, two of the top three most important shopping factors for beauty care products are discounts and coupons but consumers are more willing to pay a price premium for product quality, lack of irritants and safety in terms of their beauty care products. Consumers feel that they derive personal benefits when they get these ­attributes, the study said.

“People are using coupons in this economy at higher ­redemption levels. I think that is going to be a tactic of moving forward,” McConnell said. “It’s going to be a situation where I will be able to manage most of my life on my smartphone.”

In an effort to help its members, the GMDC will begin a large-scale study at the end of the year to really help retailers recommit to GM/HBC products.

“We are working with our retailers and the data providers to get in and take a deep look to really understand those categories better and create a compelling story for the retailer to recommit, particularly the food retailer,” McConnell said. “We are giving too much up to mass (merchandisers). We’re really excited about that work; we’ll be launching that in late December or early January. We are going to focus on eight to 10 general merchandise categories like housewares. People are cutting down on trips and we don’t want to give them a reason to create another outlet as their permanent destination. We want the food channel to be the permanent destination.

“We are trying to find ways to break out of the box ­(although) the association world is a very conservative world,” he said.

Featured Photos

Featured Photo IDDBA Annual Convention
George R. Brown Convention Center
Houston, TX