Getting with the times – Healthy Life transforms

Healthy-LifeThe health and wellness retailer, which turns 50 next year, has been around much longer than the consumer sea-change towards health-consciousness that’s catapulted its category to prominence – but retail disruption takes no prisoners.

As has been the case for many veteran retail enterprises in recent years, Healthy Life has found itself wedged between competition from up-and-coming ecommerce entrants and the major supermarkets, which have responded in-kind to the popularity of organic foods and personal care products.

But that’s all changing. In February, the turnaround experts at Allegro Funds quietly acquired a majority stake in the business from Chinese medicine manufacturer Eu Yan Sang and have since been busy positioning the company to capitalise on its laden potential.

The plan? Reposition Healthy Life as a service-driven business with new and updated stores staffed to provide “qualified” advice through workshops, seminars and consultations.

Leading the charge is a new leadership team, put together with broad-based change in mind by Allegro co-founder and now Healthy Life chairman Adrian Loader.

E-commerce expertise has been sought and found. Rolf Krecklenberg, CEO of online variety store oo.com.au, has been brought on as managing director; while Alexis Phitidis – who has spent the last three years causing headaches for Healthy Life as the CEO of ecommerce competitor Global by Nature – has been appointed COO.

Then there’s new CMO Simon Cheng, a marketing whiz who was headhunted from P&O Cruises to spearhead the revitalisation of the health brand.

The offer will see Healthy Life’s existing range of supplements, personal care and ‘super-food’ products complemented by an in-store experience centre called the Wellness Hub, already launched at a concept space in Belrose, NSW, with advice sessions on breastfeeding, gut health, sleep and menstrual cycles being offered.

Cheng says the concept will separate Healthy Life from its ecommerce competitors and its primary bricks-and-mortar competitors, but that the offer is different to the typical experience-focused store philosophy that’s been widely adopted – Healthy Life will charge for services as a core business vertical.

“The health retail experience is still stuck in the ‘80s, it’s one of the only retail experiences that hasn’t really evolved over the last decade,” Cheng tells Inside Retail Weekly.

“[Transforming] the store experience into more of a health and wellness offer rather than just selling product in stores…that’s the opportunity.”

Moving away from the halo effect

With the company’s internal market research pegging a market size of $4.7 billion, nearly double that of three years ago, there’s certainly room to grow. Healthy Life is slated to open 60 stores in the next few years and will set about refurbishing its existing network over the next 24-months with the lessons it’s learning from the wellness concept.

Cheng believes Healthy Life’s 300 staff, two-thirds of whom have or are studying a tertiary qualification in a health-related field, will make the difference in its quest for expansion – enabling the business to position itself as a legitimate health advice option with customers.

The new offer should also fit in well with how retail landlords are positioning centres around the country. As recent JLL research noted, there’s ample room for services distinct from retail in the future-proofing being undertaken by centre managers.

“Centre managers and landlords have been evolving to provide that range of services that you’d typically find in a town centre, so they’re generally complementary uses because a lot of these services are used at the same time as shoppers are going to do their weekly shops,” says JLL’s director of strategic consulting & research, David Snoswell.

Experiential stores have become popular for the halo effect they have on in-store product sales, but Cheng says Healthy Life will ideally position itself near major supermarkets, utilising the wellness hubs as a standalone offer that will decrease its reliance on product to drive overall earnings.

“The roots of the business are based in product, in selling product, and it will be, obviously. But experiences in the health and wellness industry, they’ve got to complement that product and also have the potential to be their own thing,” he explains.

Product isn’t being overlooked though, Healthy Life has just invested in apparel for the first time, picking up a line of bamboo-based activewear products, part of its effort to expand into a more general health and wellness offer that’s not as exposed to the health-food aisle at Coles or Woolies.

On the ecommerce side, competitive mitigation will be sourced from the years of online retail experience on the executive team, with the launch of an ecommerce site in the coming months slated to provide an adequate answer alongside the possibility of omnichannel initiatives such as click-and-collect.

Digital is also being built to complement the wellness hub, with access to event registration already live on the website and programmes slated to be released as a free online service via live chat.

Preventative health

Cheng reckons the market for advice in the health and wellness space is poised for especially strong growth in the coming years as the number of products within the broader category expands.

Although underpinning optimism in the overall plan to position the brand as a preventative health option with in-store nutritionists and naturopaths, Cheng is taking preventative measures of his own – making it clear that Healthy Life is offering supplementary advice to a traditional GP visit.

“It’s really simple for us. We see our services and our product as a complementary offering to other medicinal and pharmaceutical solutions that our customers will look for,” he says.

 

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