Hale: ‘Flat is where it’s at’

“Flat is where it’s at.” That was the naked truth Todd Hale, SVP Nielsen, shared with business session attendees of the 2014 GMDC Health, Beauty and Wellness Marketing Conference on Saturday afternoon when identifying the future game-changers in health and beauty. But get ready for a wild ride because the millennial generation, numbering 83 million strong, is about to step into its prime purchasing prowess, noted Maryellen Molyneaux, president of NMI, in a presentation following Hale. 

There are clearly some categories that have been winning over the past four years, Hale said. Snacks, fresh produce, coffee, candy and vitamins all topped the list of growth categories, he reported. With vitamins, it may be both a sign that more people are self-medicating and that an aging population is looking to stay out of their doctors’ office.

But more categories haven’t been performing well. That includes film/cameras and disposable diapers, which gives testimony to the way today’s technology has contributed to transforming the business — most people take pictures with their phones today, and the disposable diaper business has moved into the e-commerce arena, which now makes up about 14% of that business.

Todd Hale, SVP Nielsen, shared insights into identifying the future game-changers in health and beauty during the business session on Saturday, May 31.

“If you look across the store today, [there are] some real challenges in terms of the fact that we have a lot of departments that simply aren’t growing,” Hale said. “It’s really a good news/bad news story. Unfortunately, there’s a lot more bad news out there than there is good news today.”

There’s good news with consumer confidence on the rise, for example, but bad news in the consumers’ inability to spend. “What’s really driving slow growth in this country is the fact that we’re not giving people wages — we’ve got stagnant wage growth,” Hale said. “And also the fact that population is not growing.”

There’s also good news for retailers and suppliers trading in health, wellness and sustainability, Hale noted. Consumers who are particularly interested in health and wellness, a group NMI defines as the “well-beings,” constitute a very important segment. Compared with other shoppers, they visit the stores more often and spend more per trip, and annually, they’re worth more than any other consumer segment.

And while “well-beings” are age agnostic with representation spanning the generations, there also is some value in looking at the consumer and behavior relative to age.

Generationally, millennials have evolved into a very influential segment, Molyneaux said. “Millennials are the largest generation of young people in history; at 83 million strong, they’re taking over where boomers left off,” she said. Relative to other generations, baby boomers number 74 million and generation X, 51 million. “They’re causing a realignment of business, and we’re going to see that continue to change as they come into their earning years,” she added. “Talk about e-commerce, there’s your consumer. They’re already technology savvy. They are impatient; they want it fast; they are intelligent; and they have short attention spans — you’re going to need to win them fast.”

Millennials are important to understand, Molyneaux continued. “They are early-adopting, aspirational leaders,” she said. “They are concerned about their planet, [and] they are concerned about their health. … They are not only influencing others as they talk, but they also are highly influenced,” Molyneaux added, explaining that this generation has a greater proclivity to share their experiences through social media and conduct web searches for product information. And millennials are engaging — they want to know about the brands they buy, and they want to know about the retailers they buy from.

“When they know that your company is mindful of its impact on the environment and society, 65% say they’re more likely to try your products; 55% say they’re more likely to talk about you with their friends,” she said. And they’re less price-sensitive, Molyneaux added.

“When you see the strength of their attitudes you can see the future in this generation [making] them really important to watch.”