Kroger Grows Store-brand Beauty Products Line

The Kroger Co. has more than doubled its number of store-brand cosmetics, shampoos and other beauty items while preparing to launch more products later this year and into 2011.

The Cincinnati-based grocer said it has experienced double-digit percentage increases in sales during the slow rollout of its Mirra beauty line that began last October, according to the Associated Press. “This was a very big leap for Kroger,” noted Susan Scherer, who manages the grocer’s beauty business.

Kroger has put a high priority on store brands, with their higher profit margins and ability to strengthen shopper loyalty. Corporate brands account for 34 percent of Kroger grocery items sold and 26 percent of grocery revenue, the AP reported.

Store brands last year accounted for 23.7 percent of items sold in U.S. supermarkets, 18.7 percent of sales and $55.5 billion total sales, according to the New York-based Private Label Manufacturers Association (PLMA). Store brands accounted for 15.7 percent of health and beauty products sold in supermarkets, PLMA added.

Kroger offers more than 20,000 store-brand items, a 25 percent increase in the past two years. Nearly 100 are under the Mirra brand, which includes shampoos, face creams and accessories such as makeup brushes and loofahs, up from 41 three months ago.

CEO David B. Dillon said Kroger identified health and beauty as an underdeveloped area among store brands. “You don't consume them like food items, but you do use them up pretty regularly,” Dillon told the AP. “So you go back for replenishment, and those are the kind of items that are our forte.”

Karen Grant, beauty senior analyst for Port Washington, N.Y.-based NPD Group, said grocery customers have become more willing to try store-brand beauty products, particularly those billed as relying on natural ingredients.

Kroger’s next additions to Mirra’s lineup will be anti-wrinkle products with retinol-A, with more new products due next summer, Scherer said. national FSIs and coupons would supplement previous marketing efforts such as in-store demonstrations and word-of-mouth.