Beauty pro division

Are Drug Store Skin Care Creams Getting To Be Too Expensive?

Drug store wrinkle cream shopping use to be a taboo subject. I remember working behind the cosmetics counter at various department stores in the early 90’s. If a customer would approach and share with me their regime and it was not up to par within our retail domain, we would ostracize them. We would tell the customer time and time again that the more you spend the better you look. (that may explain my six figure salary from when I worked at Bergdorf’s) Soon enough critics like Paula Begoun and many others came to the rescue and said that not only is it OK to purchase face products at the drug store but that some of them are indeed formulated better than some of the most expensive products on the market.

As our recession hits an all time peak with the announcement of bankruptcy, at such mega companies as Reader’s Digest to the boutique companies like Deserts by David Glass, I wonder – are consumers really buying the luxury at the drugstore? Or is it an oxymoron?

What was their inspiration for creating such pricey products?

I believe it all started with a little article from Consumer Reports that was published in 2007 where readers were told that Olay actually worked better than La Prairie. In 2007 we had one of the best economic booms, especially at Pierce Mattie. I remember editors calling and asking; "What is your most expensive cream? We are going to write it up in our next issue!" Our luxury brands that were sold at Neiman Marcus thrived. Today, the tune is beauty editors seeking to place products that are not only under $50.00 but often under $25.00. I would assume that what we see on shelves today was in R&D in 2007 and marketed in 2008 when the economy was still going strong. Mass market skin care brands thought consumers would spend up to $1,000.00 for a 2oz of cream.

The culprits 

Let’s start with Olay’s new line called PRO-X packaged in sleek red with claims that it flattens, tightens and firms even the deepest of furrows. Their "starter kit" has close to 100 reviews on DrugStore.com and the consumer comments are mixed from “awesome” to “horrible.” At a sticker price of $68.00, it easily out prices itself from Clinique, Prescriptives, Origins and most other medium price prestige brands. Is this simply too pricey? How about Neutrogena’s lip plumper for a whopping $21.99 when you can have prestigious brands like DuWop’s entire lip kit for the same price?

Could this be why drugstore chains like CVS are showing increases in growth this past quarter upward of 17.6% while Sephora remains less than 10%.

More importantly if price is not an issue, is our environment of where we shop the final factor? Do you think consumers feel less guilty about buying expensive skin care products in a less luxurious environment? Would a consumer who walks into Saks and buys a $50.00 beauty product feel the same as someone who shopped at Walgreens for the exact same price? Shopper's guilt is quite common in this environment. I was out with my friend Shari this past weekend as I needed something new to wear to Saturday's Mercedes-Benz Polo Challenge at Bridgehampton Polo Club. I watched as both men and women would pick up items inspired by the price but then say; "I don't need this!" and actually put it back on the rack. Was it simply because we were shopping on Fifth Avenue? The sales and prices they were offering were very close to that of Target. I purchased a polo from Ralph, shorts from Ben Sherman and a pair of boat shoes from Sperry all for under $75.00 (not kidding!) at Lord & Taylor.

What are your thoughts on this new price increase at drug stores and super stores? Do you feel less guilty when you shop in a less expensive environment though you may actually be spending more? Will we continue shopping at the drug store and discount store or go back to the department store? Email me Pierce@PierceMattie.com