Best Buy Is Moving Into Health And Beauty. Will It Work?
Health, wellness and outdoor gear are natural expansions for retailers big and small but what happens when you started out selling almost exclusively gadgets and devices?
Health and personal wellness are definitely a lucrative market to tap into.
Currently worth $1.5 trillion, it has been expanding at a rate of 5% to 10% a year with no sign of the post-pandemic slowdown predicted by some analysts.
Whether it’s Walmart (WMT) – Get Walmart Inc. Report launching healthcare services across Florida or rumors of Amazon (AMZN) – Get Amazon.com, Inc. Report eyeing Peloton (PTON) – Get Peloton Interactive, Inc. Class A Report as a possible buyout target, bigger retailers are falling all over themselves to carve out a niche in this market and offer customers something wellness-related.
Expect to See More Health And Skin Devices at Best Buy
Best Buy (BBY) – Get Best Buy Co., Inc. Report, which started out as a Minnesota audio store in 1996, recently made a series of announcements about its own foray into the health, wellness and transportation space.
More specifically, 300 stores across the country now have dedicated skincare sections.
Those are featuring devices such as Foreo electric cleaning device and the portable health cleansers from TheraFace PRO.
Don’t expect to see nail polish or lipsticks yet as the products, while beauty-focused, are all still electronic gadgets.
“These tech-focused products come with features like pulsating facial cleansing for deep cleaning, LED light therapy to help reduce wrinkles, and microdermabrasion to help improve skin texture — and that’s just the start,” the company said in a statement.
After acquiring furniture company Yardbird in 2021, Best Buy also increased its selection of outdoor devices such as grills, outdoor televisions, speakers and fire pits.
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The retailer also plans to increase its selection of electric scooters so that, within the next 18 months, almost every store in the country will have one that visitors can pay for and carry out right then and there.
Best Buy
Best Buy also plans to launch charging stations as well as on-site consultation and repair services for these scooters in certain stores.
“We currently have more than 750 e-transportation products and accessories available on BestBuy.com,” Best Buy said.
“Over the next 18 months, we’ll be bringing a selection of these products to nearly every Best Buy store.”
Will This Help Best Buy Stay Competitive?
Throughout the pandemic, there was some talk of how the initial burst of “I’m going to get so fit!” that led to impulse buying of Peloton bikes would die down by the time stay-at-home orders eased.
But according to new numbers released by market research firm NPD, spending on health and wellness remains higher than it was in 2019 by double digits.
Cleaning, fitness and books about home gardening, self-help and hobbies are some other categories have all been seeing double-digit growth in recent months.
As a result, companies that are able to offer consumers these types of products will have an automatic edge over those who do not sell them.
While not all will be able to integrate health products into their offering at equal success rates, we can still expect to see more and more retail investment in this space going forward.
“U.S. consumer spending on wellness categories including fitness, nutrition, appearance, sleep, and mindfulness, is increasing, as about 40% of U.S. consumers consider these categories to be a high priority,” wrote the authors of a recent McKinsey report on health and wellness spending.
