New Products, Services Aimed at a Growing Diabetic Population
With Americans growing older and fatter, diabetes is becoming more prevalent. And savvy marketers are bringing out special foods, cosmetics and other products for people with the disease.
Longs Drug Stores has a diabetics club that offers members free product samples and health information. Kraft Foods, a unit of Philip Morris Cos., has a Web site dedicated to diabetic recipes. Wal-Mart Stores Inc., which has a growing pharmacy business, sells its own line of products for diabetics.
Because people with diabetes, a disease that requires daily medication and monitoring, visit drug counters frequently, merchants have regular opportunities to sell them myriad other products.
“Diabetics are diabetics for life,” said Sharon Findley, over-the-counter products manager for Walnut Creek, Calif.-based Longs Drug Stores. “They need to know where they can get these products any time, all the time.
“Once they find a source for all these items, diabetics become very loyal,” she said.
About 10.3 million Americans currently have the disorder, up from 6.5 million in 1989. Experts link the increase--at a rate of 800,000 new cases a year--to obesity, which is also on the rise. According to the U.S. Centers for Disease Control and Prevention, 20% of Americans are obese, up from 12.5% in 1991.
Costs associated with diabetes, including medical expenses and missed workdays, total $100 billion annually, making diabetes the second most costly disease next to mental illness, said Dr. Gerald Bernstein, immediate past president of the American Diabetes Assn. and director of the diabetes management program at New York’s Beth Israel Hospital. And they spend millions more on special dietary products and supplies.
According to the trade publication Chain Drug Review, diabetics account for 8% of pharmacy customers but 20% of all pharmacy sales. Each diabetic is worth more than $3,000 in annual pharmacy sales, the trade newspaper Mass Market Retailers reported recently.
The most common kind of diabetes is a metabolic disorder that results from the body’s inability to either produce or use insulin. So diabetics need to limit the amount of sugar they eat. The disease typically strikes adults, but a growing number of overweight teenagers are affected.
“That’s a burgeoning population and no one’s been talking to them,” said Mark Rode, brand manager for Keebler Foods’ Murray Sugar Free Cookies, which is considering a Web site aimed at teens.
One way Keebler and other marketers are reaching diabetics is through a Web site run by the American Diabetes Assn. The site has a virtual grocery store, where marketers can sponsor aisles and display their products on shelves.
Murray sponsors the cookie aisle, Monsanto Co.’s Equal sweetener sponsors the baking aisle and Kraft cheese sponsors the meat and cheese aisle. Other advertisers include Ocean Spray Inc. and Abbott Laboratories, whose Ross Products division markets Glucerna snack bars and nutritional drinks.
Marketers say the sponsorships, which cost $100,000 and $300,000 and include the right to use the ADA logo on products, are beneficial.
“It makes good sense from a business perspective,” Rode said. “There is a large and growing population trying to manage their diabetes that we feel is underserved.”
Marketers leverage the ADA relationship in other ways. They provide coupons, product samples and recipes that the ADA distributes to new members. Ocean Spray in January plans to post recipes on the ADA’s Web site.
The ADA says the sponsorship deals aren’t an implied endorsement. “It allows companies to say they’re proud to support us in our information, education and advocacy efforts,” ADA spokesperson Jerry Franz said.
But the arrangements can backfire. The Federal Trade Commission in 1995 ordered Eskimo Pie Corp., an ADA sponsor, not to misrepresent its products as being appropriate for diabetics. Ads for its Sugar Freedom desserts used the ADA logo, though the food had 16 grams of fat.
Besides the tie-ins, some marketers use grass-roots tactics. Pharmacists from Wal-Mart and CVS Stores meet with community groups. And the 6,000 members of Longs’ year-old diabetes club receive free samples of diabetic products, health and wellness mailings and a membership card that expedites filling prescriptions.
Kraft recently arranged radio and TV interviews for nutritionist and author Elizabeth Hiser, who discussed ways to control diabetes and plugged Kraft products--and other foods for diabetics--during the broadcasts. Kraft also has a Web site for diabetics listing recipes that use its products.
Marketers say display in stores is an important aspect of their promotional efforts. The end of the aisle facing the pharmacy is “prime real estate,” said Lori Marin, treasurer and vice president of Keebler Foods. As prescriptions are filled, cookies land in shopping baskets as impulse items, she said.
Longs Drug groups candy, cookies and nutritional bars and drinks with medical supplies near the pharmacy counter. The chain says sales of diabetes-related merchandise have increased more than 10% in the 12 months ending in October.
Wal-Mart, which in the last year developed an extensive line of private-label products, also groups the syringes, glucose tablets and moisturizing creams in the pharmacy. Sales of the ReliOn products “have exceeded our expectations,” said Frank Segrave, Wal-Mart’s vice president and divisional merchandise manager. And Wal-Mart next year may add to its ReliOn product line, which already includes four flavors of glucose tablets and four kinds of skin creams.
But manufacturers want their products in the regular food aisles too. The maker of Ensure Glucerna wants its bars and beverages, formulated to help stabilize blood sugar, to sit alongside other nutritional supplements, according to Ross spokeswoman Chris Carey.
Since most newly diagnosed diabetics are adults, “these folks are used to shopping in certain aisles,” said Keebler’s Marin, who also wants cookies in the regular snack aisle. “They don’t want to go [to a diabetic section], because they would have to admit they have a problem.”
By shopping in the regular cookie section, “they can feel normal,” she said.
