Germany: Dr. Hauschka turns down drugstore chain

The German natural cosmetics company Wala-Heilmittel has turned down the drugstore chain Müller to retail its Dr. Hauschka products. The recently opened Müller Naturshop in Bad Kreuznach has not been officially supplied Dr. Hauschka natural cosmetics.

Wala Heilmittel stated it decided against supplying Müller because the company was perceived as a discounter, something that is not in line with Dr. Hauschka’s marketing strategy. Müller is selling Dr. Hauschka products after obtaining them in the ‘grey market’ and has been offering them in its Bad Kreuznach store.

Wala Heilmittel reacted by buying the entire stock on the opening of the store. They stated that the selective distribution system it introduced in 2007 has criteria for managing the brand and distribution which makes it coherent for the retailer and consumers. The company said that their partnership with the specialist trade was their highest priority.

Organic Monitor Comment

A number of natural cosmetic companies are adopting a selective distribution strategy in which only selected outlets carry their products. The advantage of the strategy is that it enables companies to have greater control over brand positioning and marketing. Dr. Hauschka is positioned as a premium brand, and WALA-Heilmittel does not not want to de-value the brand by giving access to all retailers. As the natural cosmetics market matures, expect more companies to deploy such marketing strategies.