How Britain Shops for Health & Beauty | Verdict Consumer Report

Use retailer ratings across eight key metrics to benchmark the performance of retailers in the health & beauty market Identify what factors health & beauty shoppers find important, and how well retailers satisfy the expectations of their shoppers Understand what channels shoppers are using to make purchases and see how this varies across regions and demographics to improve customer targeting

Scope

25.2% of health & beauty shoppers feel better off in 2015 compared to last year, and as a result 26.8% feel they are spending more. This has enabled health & beauty retailers to premiumise their offers, as willingness to spend is increasing and shoppers are becoming more easily encouraged to buy into newness of non-essentials more regularly.

Only 47.3% of Superdrug’s visitors are frequent shoppers, causing its shopping around score to be high compared to rivals Tesco, Boots, and Asda. Superdrug needs to invest in new creative products to stand out among its value and midmarket competitors and drive additional spend from experimental shoppers.

52.4% of shoppers visit Boots for health & beauty products, a 24.1 percentage point lead ahead of the second most visited retailer, Tesco. However, when looking at frequent shoppers, Tesco outshines, with 63.5% of consumers shopping frequently with the grocer compared to 60.7% at Boots.

Reasons to buy

Which health & beauty retailers have the highest share of visitors and purchasers Which retailer has the highest conversion rate in health & beauty

How many other stores do your shoppers use for health & beauty

How often do health & beauty shoppers shop for health & beauty

How much better off do health & beauty shoppers feel in comparison to last year And how much are they spending compared to last year

Table of Contents

1 Overview

2 Main Conclusions

2.1 Health & beauty shoppers are feeling better off financially, aiding premiumisation in the sector

2.2 Potential for health & beauty players to increase frequency usage among males

2.3 65+s are an underserved but lucrative consumer segment

2.4

32.4% of shoppers buy online for health & beauty and have goods delivered

2.5 Boots must drive visitor frequency through investing in convenience

2.6 Superdrug must improve its own label offer to encourage shopper loyalty

2.7 While Aldi and Poundland win on price, low quality scores result in customers shopping around

3 Sector Analysis

3.1 Sector summary

3.1.1 Over 25% of shoppers feel better off, leading to almost 27% feeling they spend more

3.2 Shopping frequency

3.2.1 Retailers must drive shopping trip frequency among males and 65+s

3.3 Channel spend

3.3.1 Immediate needs sector leads to wide gap between store and online purchasing

3.4 Penetration of shoppers

3.4.1 While Boots draws in more visitors, Tesco outshines in frequency shopper numbers

3.5 Conversion

3.5.1 Body Shop has the lowest conversion, with low scores in price, convenience instore and value

3.6 Shopping around

3.6.1 Boots’ Advantage Card and wide product choice result in its customers shopping around the least

4 Retailer Ratings

4.1 Importance of shopping drivers

4.1.1 Value for money ranks most important

4.2 Retailer ratings

4.2.1 Body Shop ranks highest for customer service so must better promote its services to shoppers

5 Methodology

5.1 Access to additional data

6 Appendix

6.1 About Verdict Retail

6.2 Disclaimer

List of Tables

Table 1: Frequency of health & beauty shopping trips by region (%), 2015

Table 2: Frequency of health & beauty shopping trips by demographics (%), 2015

Table 3: Channels used in the last year by health & beauty shoppers by region (%), 2015

Table 4: Channels used in the last year by health & beauty shoppers by demographics (%),2015

Table 5: Top 10 retailers’ share of regional health & beauty shoppers (%), 2015

Table 6: Average conversion of health & beauty retailers by region (%), 2015

Table 7: Health & beauty retailer ratings for shopping drivers (rated out of 10), 2015

Table 8: Health & beauty retailer ratings for shopping drivers (rated out of 10), 2015

Table 9: Health & beauty retailer ratings for shopping drivers (rated out of 10), 2015

Table 10: Health & beauty retailer ratings versus driver importance, 2015

Table 11: Health & beauty retailer ratings versus driver importance, 2015

Table 12: Health & beauty retailer ratings versus driver importance, 2015

Table 13: Sample sizes by sector, 2015

List of Figures

Figure 1: How much better off health & beauty shoppers feel compared to last year (%), 2015

Figure 2: How much extra health & beauty shoppers feel they are spending compared to last year (%), 2015

Figure 3: Health & beauty share of shoppers (%), 2015

Figure 4: : Demographic profile of health & beauty shoppers (%), 2015

Figure 5: Frequency of health & beauty shopping trips (%), 2015

Figure 6: Channels used in the last year by health & beauty shoppers (%), 2015

Figure 7: Percentage of consumers who shop for health & beauty by demographics (%), 2015

Figure 8: Percentage of consumers who shop for health & beauty by region (%), 2015

Figure 9: Percentage of health & beauty shoppers visiting the top 10 retailers (%), 2015

Figure 10: Percentage of health & beauty shoppers purchasing from the top 10 retailers (%), 2015

Figure 11: Proportion of shoppers who are frequent or occasional shoppers at the top 10 health & beauty retailers (%), 2015

Figure 12: Average rate of conversion for all sectors (%), 2015

Figure 13: Top 10 retailers’ conversion for health & beauty (%), 2015

Figure 14: Average number of health & beauty retailers each shopper visited and purchased from in the last year, 2015

Figure 15: Average number of health & beauty retailers purchased from by region, 2015

Figure 16: : Average number of other health & beauty retailers purchased from for the top 10 retailers, 2015

Figure 17: Importance of shopping drivers to health & beauty shoppers (rated out of 10), 2015

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