CHICAGO — Reflecting the growing contribution of beauty to Kmart’s business, the discount store chain is embarking on a new strategy it hopes will increase its business even more.
Kmart’s effort includes a greater emphasis on skin care, a plan to enhance service by introducing beauty consultants to the top 500 stores and the continued rollout of new cosmetics department prototypes that the chain began testing last year.
Overall, Kmart’s beauty business is running ahead of last year by a high-single-digit percentage, said Mary Prince, merchandise manager. “I see a real opportunity to proceed and grow and continue to gain market share,” she said.
Skin care, color cosmetics and men’s fragrance are the strongest categories, Prince said.
“Skin care and beauty treatment has become our prime category,” said Kevin Browett, vice president and general merchandise manager. As a result, Kmart’s prototype stores are devoting “significantly” more space and a bigger variety of lines to those areas, he said.
The first prototype opened in the Auburn Hills, Mich., store — not far from the company’s Troy headquarters — about a year and a half ago, and prototypes have since been rolled out to about 180 newer and remodeled Kmart stores nationwide. The company operates about 2,400 stores.
Besides emphasizing skin care, Prince said the new departments feature glass fragrance counters, more modern graphics and color schemes and new fixtures, such as Mylar pegboards.
“They are working well, but we are always looking for ways of improving our presentation,” she said.
Skin care continues to be one of the brightest spots for Kmart, with sales ahead of last year by a double-digit percentage, said Lorraine Coyle, buyer. “There’s more overall awareness of the effects of the sun and aging,” she said.
The growth in the category has also been fueled by some successful recent launches, Coyle said, pointing to alpha-hydroxy acid products such as Pond’s Age Defying Complex, Oil of Olay’s Renewal and L’Oreal Plenitude’s Excel-A3, which was launched at the beginning of May. Heavy promotion by manufacturers has also helped stimulate skin care sales, she said.
Coyle also noted a blurring of the lines between skin care and bath products at the mass market level, with a greater emphasis on total body care for the customer. As an example, Coyle cited the Neutrogena range, which includes Rainbath shower gels and body lotions as well as facial treatment products, but is merchandised in the skin care category.
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The bath category as a whole has been trending down at Kmart. “I’m not sure the consumer is as into bath as we had believed,” Prince said, adding that her buyers were currently reviewing the lines to see how to edit the selection for the future.
In the makeup category, a key change is the introduction of cosmetics specialists into the top stores, said Susan Grimshaw, buyer. The beauty consultants, who are not licensed but will be fully trained, are scheduled to be in 500 stores by the end of August.
The concept was tested in a few stores in the second half of last year, and Kmart found that cosmetics sales in those stores improved by a single-digit percentage, Grimshaw said.
The prime role of the specialists will be to help customers find specific products or colors. They won’t offer makeovers or employ high-pressure selling tactics, added Browett.
“We’re not trying to be a department store,” Browett said. “The customer is smart enough to know we can offer the same thing and give good service.”
Grimshaw also noted a customer trend toward more upscale color cosmetics. She said business is growing fastest among the higher-priced brands such as Revlon and L’Oreal, which are at the upper end of the mass market price range and are the top color performers at Kmart. Maybelline’s Revitalizing Makeup also has been doing very well, she said.
But while the Kmart consumer’s taste may be getting more upscale, it hasn’t yet developed a craving for the department store brands. A test of diverted skin care lines such as Elizabeth Arden and Clinique has been discontinued, said Grimshaw.
“We didn’t see the sales, and you need to get a full assortment of the products,” she said. Diverters on the gray market aren’t always able to acquire complete lines of product.
The prestige brands also suffered, Coyle said, because the mass manufacturers have been quick to jump on trends, namely the alpha-hydroxy acid craze.
Some Kmart stores, however, will continue to offer diverted designer fragrances, Browett said.
As far as mass market fragrances are concerned, Coyle said Coty’s Vanilla Fields and Cover Girl’s Navy continue to be top performers, and L’Oreal’s V by Gloria Vanderbilt had a solid launch this spring. In men’s fragrance, top performers are Stetson and Preferred Stock, both from Coty.
Noting that Kmart’s strategy will continue to focus on Middle America, Browett said, “Our [beauty] business addresses the key customer for Kmart — the mass population, not the high or the low end.”