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Study: Higher-income shoppers turn to warehouse clubs for quality

BY Antoinette Alexander

CHICAGO — Not only do higher income shoppers flock to warehouse clubs in a quest for quality, but private-label brands at warehouse clubs are believed to be comparable in terms of quality compared with name brand items, according to new research from Mintel.

According to Mintel, 38% believe store brand or private label brands at warehouse clubs are comparable to name brand items in terms of quality — a number that increases to 44% of households earning $150,000 or more. That’s the highest percentage of all income groups surveyed, compared with 27% of those earning less than $25,000, 36% of those earning $50,000 to $74,900, and 41% of those with incomes between $100,000 to $149,900.
 
Furthermore, 40% of warehouse club users say warehouse clubs carry quality products — with 46% of households with an income of more than $150,000 or more reporting as much. The number drops to 32% for those earning less than $25,000, 41% of those earning $50,000 to $74,900, and 42% of those with household incomes between $100,000 to $149,900.

“Shoppers in this group may be more likely to shop across a wider variety of retail stores, and therefore more aware of the price differential among retailers,” stated Ali Lipson, category manager for retail, apparel, technology and automotive at Mintel. “They are also more likely to be able to afford the shopping trip compared to those with lower incomes. Product messaging and signage that highlights the quality of warehouse club products is sure to resonate with this demographic.”

This market also might be immune to threat of online shopping, as 63% of Americans have shopped (in-store) at a warehouse club in the last six months, but only 25% have done so online.

“One deterrent to online shopping in this channel could be that stores offer bulk- sized packages so the cost of shipping large items could prove prohibitive,” noted Lipson. “Additionally, part of the appeal of warehouse club shopping is the ‘treasure hunt’ aspect, or discovering unique items throughout the store. Currently, the warehouse clubs’ online model is unable to replicate this experience.”

More than one-third (36%) of warehouse club shoppers agree that they like finding unique items when shopping at warehouse clubs. This number increases significantly for women aged 55 and older, with 45% of that demographic reporting as much. The least likely bargain hunters at 30% are women aged 18 to 34.

“More than half of warehouse club shoppers like to browse the selections, and 48% say it is worth paying the membership fee to shop at a warehouse club,” added Lipson. “Warehouse clubs intentionally offer a unique product mix aiming to appeal to the ‘discovery’ experience many shoppers crave. It also helps encourage repeat visits, as product selections can vary from time to time.”

The research also found that 11% of those surveyed said an app that helps them navigate the store and find items would encourage them to visit warehouse clubs more often or sign up for a membership. Meanwhile, 12% agree that sales associates with handheld devices that can provide checkout anywhere in the store would increase their usage.
 

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Unilever sells Slim-Fast to private equity firm

BY Michael Johnsen

LONDON — Unilever on Thursday announced that it has sold its Slim-Fast brand to Kainos Capital. Unilever will retain a minority stake in the business.
 

“The Slim-Fast sale is the last step in the portfolio reshaping that we had planned for North America," stated Kees Kruythoff, president Unilever North America. "This transaction, along with previously announced divestitures, will give us the focus to drive growth behind our core portfolio.”
 
Sales of Slim-Fast 321 Plan ready-to-drink diet aids totaled $127.7 million, down 13.6%, for the 52 weeks ended May 18 across across total U.S. multi-outlet channels, according to IRI. Sales of the company's Slim-Fast 321 Plan snack bar totaled $7.1 million and were down 37.9%. 
 
The transaction includes the Slim-Fast trademark and the global Slim-Fast business portfolio. Terms of the transaction were not disclosed.
 

 

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Lumene ventures into anti-aging

BY Antoinette Alexander

NEW YORK — Finnish beauty brand Lumene has kicked off 2014 with a bang with revamped packaging and a broadened product portfolio. The evolution continues as the company further extends its Bright Now line into anti-aging.

The new Bright Now Visible Repair line, which is infused with arctic cloudberry to help battle the signs of aging, launches in July.

The collection includes a day cream with SPF 15, night cream and skin tone corrector to help even skin tone. The hero product is a new 2-in-1 eye cream and concealer. Twist off the top cap to use the concealer and twist off the bottom to use the eye cream.

To highlight the efficacy of its products and to give the packaging a more clinical look and feel, the beauty brand recently revamped its product packaging.

The company also launched a new website that has a modern look and is easier to navigate. It also features an increased level of product information and product reviews.

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