OTCMegatrendsReport_2016

Inside:
View from the top
State of the market
Breakthrough brands
The Business of Retail Pharmacy
March 2016
OTC
Megatrend
Report
Over
the
COUNTER TREND REPORT
View from the top: Leading OTC vendors
discuss the state of the business
In the weeks leading up to the Consumer Healthcare Products Association Annual Executive Conference, March 14 to 16, in Aventura, Fla., Drug
Store News assembled a virtual panel of leading
over-the-counter company executives, to discuss
the many opportunities to drive growth, build the
market basket and drive more shoppers to the OTC
aisle. Find out why top OTC marketers are so bullish on the business in 2016 and beyond.
DSN: The Affordable Care Act is increasing
access for millions of Americans while the
steady rise of high-deductible, consumer-directed health plans continues to place more of
the onus for managing escalating healthcare
costs on consumers. How are these two macro
trends impacting the OTC business?
DENNIS CURRAN, CHIEF CUSTOMER OFFICER,
GSK CONSUMER HEALTHCARE: OTCs will con-
tinue to be the first line of defense for a ma-
Changes in health care, including high-deductible health plans, are driving more customers to the OTC aisle.
jority of individuals to address the healthcare
ailments that disrupt everyday life. The biggest impact the Affordable Care
Act had on consumer access to OTCs was the
elimination of the use of healthcare savings accounts and flexible spending accounts toward
purchases of over the counter or nonprescription medicines. It is a healthcare benefit that
more than 19 million Americans [had used] to
offset their personal spending on health care.
Through the Consumer Healthcare Products
Association, we have consistently supported
efforts to reinstate the use of OTCs and nonprescription medicines toward HSAs and FSAs.
CLARK BROWN, SVP/CHIEF CUSTOMER OFFICER,
ADVANTAGE CONSUMER HEALTHCARE: Clearly,
“EDUCATING THE SHOPPER AS THEY
PLAN THEIR TRIP IS CRITICAL TO DRIVING
CONVERSION. THROUGH ROBUST SHOPPER
INSIGHTS, WE’VE SEEN IMPROVED
SIGNAGE AND EDUCATION AT SHELF
LINKING SYMPTOMS [AND] CONDITIONS
WITH SOLUTIONS. ”
— Dennis Curran, GSK Consumer Healthcare
1 • MARCH 2016
more consumers have access to health care due
to this initiative, but I believe another significant trend we are seeing is the overall education of consumers about their healthcare choices. The ACA really requires consumers to be
more involved in their healthcare choices. One
trend we have seen is the move to finding more
of your wellness solutions at retail. Healthcare
companies, both retailers and manufacturers,
need to work together to create and then make
readily available the new, unique solutions that
consumers are looking for today.
DSN: OTC remedies drive a lot of traffic to retail pharmacy. At the same time, many OTC
categories historically have been tough for
customers to navigate and self-select the right
product for their needs. How can retailers
partner with vendors to make the OTC category easier to shop?
TODD HUTSKO, VP SALES, FLEET LABORATORIES:
The easiest things for retailers to do are to simplify category layouts and provide navigational
and educational information. In feminine hygiene, as an example, we’re seeing retailers support [the category] in premium space within the
stores, testing varying degrees of navigational
and educational signage that calls attention to
the segment. Many retailers are currently evaluating the flow of the shop and how to best
position items women want in a way that both
enhances and improves her shopping experience. Specifically, moving such expandable consumption feminine hygiene products as external
washes, cloths, sprays and powders to more
visible shelf locations, improves the shopping
experience and retailer results in the category.
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not having too many options (paradox of choice).
It also reduces the inventory position that a retailer must make which, in turn, allows more space
to stay in-stock.
In a nutshell, paring down assortments and
merchandising in a way that simplifies the shopping experience creates a winning proposition
for all parties involved — the consumer, the retailer and the manufacturer alike. We have seen
great results with these principles, and we plan
to expand our merchandising principles to all
of our categories moving forward, whether it be
OTC, wound care, oral care, etc.
CURRAN, GSK CONSUMER HEALTHCARE: OTC
Vendors are working to add more education that is easy to understand in the aisles to help aid product selection.
Continued from page 1
Research and results show that women seeking
need-based products within the set will search
out and find the problem/solution products.
KATHLEEN WIDMER, CO-CHAIR, JOHNSON &
JOHNSON CONSUMER, NORTH AMERICA/PRESIDENT, MCNEIL CONSUMER HEALTHCARE: Over
the years, we have conducted a lot of consumer research that has provided us with valuable
“WE BELIEVE THERE IS A CONTINUED
OPPORTUNITY TO ENABLE CUSTOMERS
TO TAKE HEALTH AND WELLNESS INTO
THEIR OWN HANDS. IT IS ABOUT GOING
BEYOND THE PILL AND HAVING A
SOLUTION MINDSET. ”
— Chris Slager, North America, Pfizer Consumer Healthcare
2 • MARCH 2016
information about how our consumers navigate and shop our categories. The OTC market
is highly competitive, with many players and
many categories. Our research led us to create
merchandising solutions that we believe have
transformed the shopping experience in OTC
categories. We started with the upper respiratory category, including allergy, sinus [and]
cough-cold-flu. We created a set of guiding
principles for retailers to consider in order to
simplify the shopping experience for the consumer, including:
• Creation of clean partitions between category segments;
• Focusing on a product assortment with
the most productive and incremental
SKUs;
• The addition of simple consumer
friendly education that helps in the decision-making process; and • Lastly, we recommended adding complementary products, such as humidifiers
with cold and flu products, that make
sense in the respective category. We have
seen significant incrementality and consumer satisfaction through the addition
of complementary products. In the pain category, we have streamlined our
assortment with the recognition that consumers
don’t need five to six size options of a given form.
Our assortment approach is rooted in offering
three relevant size options, which impacts a number of factors relative to selling a product. Having
fewer choices can reduce consumer confusion by
categories are making progress in improving
navigation and selection for the shopper. This
improvement is largely driven by investment
in shopper insights to better connect with the
shopper along their purchase journey. Retailers
are partnering with manufacturers to leverage
their digital space as part of pre-trip planning,
given many OTC category [purchases] are highly
planned. Also, retailers are partnering to communicate compelling claims that are relevant and
motivating to their specific shopper, and providing education to help the shopper identify their
symptoms and navigate to the right solution. Educating the shopper as they plan their trip
is critical to driving conversion. Through robust
shopper insights, we’ve seen improved signage
and education at shelf linking symptoms and
conditions with solutions, which is driving conversion and more importantly loyalty. An example of this is in the pain relief category, where
clearly articulating at shelf the usage of different
products for sleep, headache, heart health, general body pain, etc., has been a growth driver for
the category and made significant impact in helping the shopper choose what is right for them.
In addition, we are excited to share that we will
be opening a new, state-of-the art Shopper Science and Collaboration Lab in our new Warren,
N.J., North America headquarters. This research
facility is fundamentally focused on working
with our retail partners to harness our shopper
insight capability and build better plans that provide a rewarding experience for consumers when
they are shopping in OTC categories.
BROWN, ADVANTAGE CONSUMER HEALTHCARE:
Improving the shopping experience for the
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Continued from page 2
consumer is critical to keeping them engaged
and looking to retail to help them manage their
healthcare needs.
We know consumers are on the go and want
desperately to be able to easily find their product solution. I believe it starts with insight into
the path to purchase for consumers. How do
consumers educate themselves prior to making
a purchase all the way through the consumer
standing at the shelf and selecting the brand
that best meets their needs? Both retailers and
their partner companies can benefit from mining these insights and then using it to develop
the plan on how they educate and inform [the
consumer], decide what products should be introduced and then properly merchandised at the
point of purchase.
DSN: From your perspective, what are some
of the best opportunities to grow sales in the
OTC category? CHRIS SLAGER, PRESIDENT, NORTH AMERICA,
PFIZER CONSUMER HEALTHCARE: At Pfizer we
believe there is a continued opportunity to enable
consumers to take health and wellness into their
own hands. It is about going beyond the pill and
having a solution mindset. There also are opportunities to continue to focus on using better tools
and technology.
JEFF VERNIMB, GENERAL MANAGER, MOBERG
PHARMA: OTC continues to be a great comple-
ment to many Rx treatments. Yet on many occasions, the shopper picking up a prescription
does not shop the front end. We see great opportunities to better link pharmacy and front
end. For example, an oral terbinafine (Rx) can
be an effective cure for nail fungus, but the
treatment can take several months to result
in improved nail appearance. Kerasal Nail, a
cosmetic treatment, is clinically proven to improve the appearance of damaged nails in as
little as two weeks. BROWN, ADVANTAGE CONSUMER HEALTHCARE:
Insight and education. Understanding what
solutions consumers are looking for and properly educating them on what brands or services
are available continue to be big opportunities.
Consumers are looking for solutions that allow
them to manage their wellness at home and at
their own pace — they are looking for solutions
to help them reclaim the lifestyle that they desire. We have a joint responsibility to educate
consumers on the solutions available to help
manage their healthcare needs. We then need to
work hard to make those options readily available and accessible at retail or online. When
new solutions emerge for managing a condition
like chronic pain, how do we ensure consumers
are better informed about new products [that]
are available? Creating that awareness and then
educating the shopper at every step in the path
to purchase is a shared responsibility. Partners
who work together to address these opportunities will reap the benefits.
“WE HAVE SHIFTED OUR THINKING
FROM JUST DELIVERING THE STANDARD
FOUR Ps (PRODUCT, PLACE, PRICE AND
PROMOTION) TO FOCUSING ON OFFERING
OUR CUSTOMERS AND CONSUMERS
SOLUTIONS, ACCESS, VALUE AND
EDUCATION — THE SAVE MODEL.
— Kathleen Widmer, Johnson & Johnson Consumer, North
America/McNeil Consumer Healthcare
CURRAN, GSK CONSUMER HEALTHCARE: Meaningful innovation that drives incrementality and
newness to the category will drive growth. Companies that continue to deliver real innovation
will win in the market. I also believe there is an opportunity for solution selling. Shopper insights have shown that
shoppers experience multiple conditions, and
those retailers that are able to effectively merchandise solutions and educate the connection
between items, will [be the ones to] drive an increased market basket. Finally, improving the overall shopping experience wherever the person researches for brands
is vital. Making the OTC category more shoppable through improved navigation, better education and stronger claims to connect with shoppers will help to improve the in-store experience.
WIDMER, JOHNSON & JOHNSON CONSUMER,
NORTH AMERICA/MCNEIL CONSUMER HEALTHCARE: We are focused on delivering innova-
Educating the customer pre-trip is becoming more important — understanding how consumers learn about products prior to
making a shopping trip all the way through to standing at the shelf.
3 • MARCH 2016
tion that meets the needs of our consumer that
goes beyond just product innovation. We have
shifted our thinking from just delivering the
standard four Ps (Product, Place, Price and Promotion) to focusing on offering our customers
and consumers Solutions, Access, Value, and
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Continued from page 3
Education — the SAVE model. (For more, hbr.
org/2013/01/rethinking-the-4-ps.)
With the rise of self-care, many consumers
have heightened awareness of what they need
and are taking more action to better understand
their options. Many times, they are using a “toolkit” of solutions, such as a saline nasal spray,
antihistamine and netty pot, depending on their
needs. That said, we work with our customers
to provide solutions across the category that provide a comprehensive approach to a condition
and simplify the shopping experience.
Additionally, our team has built digital tools
that are helpful to consumers. For example, our
AllergyCast app is the first app that tells you how
the pollen count may actually make you feel and
can help you track your allergy triggers.
We also know that mom and dad need help in
managing their child’s health in a way that’s accessible and convenient. We developed the Kids
Wellness Tracker, which is an all-in-one solution
that makes it easy for parents to track their children’s symptoms, find the right dose and keep
track of their [children’s] height, weight and
progress as they grow. These are just a few of the
tools that better help us deliver on how today’s
consumer thinks about, consumes and shops for
OTC products.
HUTSKO, FLEET LABORATORIES: For low house-
hold penetration categories like feminine hygiene, we first recommend that retailers execute
the home category location with excellence. Specifically, make certain there are proper presentation minimums that match the store level opportunity to maximize in-stock levels and to make
certain the section is clean and inviting to shop
with good navigational and directional signage.
Secondly, capitalize on getting more awareness
for the category with off-shelf displays, secondary locations, and create partnerships with other
manufacturers pairing complimentary offerings
in order to generate awareness and multiple purchases. We are keen to share our new insights
about how women want to learn about feminine
hygiene in-store and in the aisle, and work with
our partners to create a win for all parties leveraging these learnings.
DSN: There is a lot of focus on the millennial consumer these days. Is there anything unique about
how generations Y and Z are shopping for OTCs,
4 • MARCH 2016
Consumer insights indicate that customers shop the OTC aisle differently, category by category, channel by channel.
and how can retailers and suppliers do a better
job of converting these younger customers?
HUTSKO, FLEET LABORATORIES: The Summer’s
Eve brand is investing more heavily in a digital
advertising strategy to engage this demographic, in search where women are seeking information in social media, and working with leading
digital partners so we can target our messaging
appropriately and contextually. Television advertising and professional outreach is still key to
our strategy, but we believe our message needs
to be where millennial women can receive it
during the times when they are most open to
hearing about these products.
BROWN, ADVANTAGE CONSUMER HEALTHCARE:
Millennials are the most tech-savvy consumers
in the marketplace today. They expect a personalized connection to their chosen brands and
retailers. Because they integrate technology into
everything they do, conducting research before
shopping and comparing products in the store,
millennials are very educated shoppers [who
are] conscious about their product choice and
the price they pay. Converting millennials can be
influenced by personalized pre-store communications via loyalty coupon mailers, email newsletters and ads, mobile ads and apps, and digital
coupons that play into their fiscally-conscious
shopping habits.
WIDMER, JOHNSON & JOHNSON CONSUMER,
NORTH AMERICA/MCNEIL CONSUMER HEALTH-
“WE KNOW THAT CONSUMERS ... WANT
DESPERATELY TO BE ABLE TO EASILY
FIND THEIR PRODUCT SOLUTION. I
BELIEVE IT STARTS WITH INSIGHT
INTO THE PATH TO PURCHASE. HOW DO
CONSUMERS EDUCATE THEMSELVES
PRIOR TO PURCHASE?”
— Clark Brown, Advantage Consumer Healthcare
CARE: The benefits of OTC products are seen
across generations. People of all ages need to be
able to manage common conditions, such as pain
and allergy, so they can engage with their families, friends, at school or at work. In that sense,
regardless of generation, OTC stays the same.
For this younger and relatively healthier generation, engagement with OTCs is somewhat
low. They continue using what has worked
in the past, until something changes. That is
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where we need to be ready to meet their needs
in more places, in more formats than any generation before them.
For millennial women, the first change can be
becoming a parent. For any millennial parent, it
is their child’s first fever. The stakes are high, and
the information sources are far greater than they
were for past generations. Word of mouth still
plays a key role for how moms and dads receive
information; however, digital — mobile, in particular —provides a vast array of tools and technology that deliver health content at their fingertips. With our heritage with families through our
infant’s and children’s Tylenol and Motrin products, we have a responsibility to support them at
this time. Our role is to provide information that
focuses on the health and safety for their family.
We take pride in understanding our consumers not just by their ailments, but for the lives they
lead and the challenges they face. Not only will
this help us develop better product solutions, it
helps us provide information to our retail partners to better serve their shoppers, whether they
be brick-and-mortar or e-commerce outlets. Currently, we are conducting market research on
heads of households making minimum wage,
on tight budgets or stretching their income across
large households to understand how to better
serve these consumers. In many cases, these are
millennials juggling student loans or starting a
family, stretching the same dollars across more
people. With this important research, we can better serve these consumers and also help our retail
partners meet their needs as well, even if it isn’t
through our products. DSN: Consumer insights are the lifeblood of the
business. Has your company uncovered any new
insights on the OTC customer that you think retailers should be aware of? WIDMER, JOHNSON & JOHNSON CONSUMER,
NORTH AMERICA/MCNEIL CONSUMER HEALTHCARE: People today have an aspirational and proactive approach to how they take care of themselves. They think about their health differently
in that it is an important asset that allows them to
enjoy moments that matter and be there for those
they care about. Retailers and manufacturers
have an elevated role in partnering with consumers to make informed choices as they move more
toward self-care.
5 • MARCH 2016
OTC vendors and retailers need to balance the needs of the two largest — and very different — consumer groups, millennials
and boomers.
VERNIMB, MOBERG PHARMA: Specific to foot
care, if the consumer doesn’t see the product working, in his or her mind it’s not. The
consumer is very impatient, so you have to
be very clear about what you do and don’t
do. Moberg’s approach is to set clear expectations and to be honest in delivering against
those consumer expectations. HUTSKO, FLEET LABORATORIES: We have made
a significant strategy and structural commitment to insights at Fleet. We have brought in
a new leader for our newly created customer strategy and insights role to provide a step
change to our insights competencies as a company. One of the key pillars of our retailer partnerships is that we provide actionable insights
to help lead our categories to new growth levels
and into an exciting future.
We’ve consistently invested in consumer
insights over the years, and most recently,
we have seen a significant shift in attitude
[in terms of shoppers] being more open to
using feminine hygiene products proactively
as part of [their] daily freshness routines. Not
only are women less embarrassed to be seen
shopping these items, but they are far more
likely to have a conversation about their vaginal health — and they state that they use these
products more for themselves and not for others. Attitudinal trends continue to turn more
positive for feminine hygiene as, notably, 93%
of women express agreement that it is worth
their time to use products specifically made
“OTC CONTINUES TO BE A GREAT
COMPLEMENT TO MANY RX TREATMENTS,
YET ON MANY OCCASIONS, THE SHOPPER
PICKING UP A PRESCRIPTION DOES NOT
SHOP THE FRONT END.”
— Jeff Vernimb, Moberg Pharma
for their vaginal area.
In addition, we have gathered form and
fragrance insights. Our research indicates
this category is a range business, and retailers
should stock products by form and fragrance
to satisfy demand of those that seek different fragrances and those that prefer multiple
products in the same fragrance.
Lastly, another new insight is that 66% of
women indicate they expect to learn about femContinued on page 6
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Continued from page 5
inine hygiene products at the shelf. These insights suggest there is opportunity to increase
education and navigation at the point of sale.
ence, new news, new technology. I see opportunities to really help inform the pre-shop in
new and interesting ways and to partner with
our retail customers to drive growth.
CURRAN, GSK CONSUMER HEALTHCARE: GSK
CURRAN, GSK CONSUMER HEALTHCARE: Exciting.
Consumer Healthcare has been aggressive
in driving [its] insight capability over the
last three-plus years. GSK has embarked on
shopper research across the key categories we
compete in — pain, cough-cold and digestive
health — which has resulted in strategic selling category platforms. A key finding that has
been consistent across these platforms is the
unique insight into how the shopper is different channel by channel and retailer by retailer,
which better informs channel/retailer-specific,
go-to-market planning. Brands cannot have
a one-size-fits-all strategy; the insights drive
channel-specific strategies to create differentiation and inform retailers how to best leverage
their assets to connect better with their shopper. As GSK continues to develop its insight
capabilities, we’ll be working toward launching strategic selling category platforms in the
oral health and smoker’s health categories.
DSN: If you could sum up the state of the OTC
business today in one word, what would it be? SLAGER, PFIZER CONSUMER HEALTHCARE: Ex-
citing. This is a very dynamic time — new sci-
VERNIMB, MOBERG PHARMA: Stable.
TODD HUTSKO, FLEET LABORATORIES: Op-
portunity. It is up to the collective industry to
make the OTC business as meaningful as we
want. Yes, it is often hard work, but I have
always felt that if you lead with your heart
and go for the big wins, the business results
will follow.
WIDMER, JOHNSON & JOHNSON CONSUMER,
NORTH AMERICA/MCNEIL CONSUMER HEALTHCARE: Dynamic. Not only is it an environment
of rapidly changing innovation with Rx-toOTC switches and technological advancements, but the business is dramatically shifting from being focused on efficacy, function
and one-size-fits-all to an environment of personalization, emotion and customization. As
a result, we must continue to look ahead and
focus on key trends, such as intelligent care,
the rise of the digital shelf and the needs of
today’s family.
DSN: What’s your outlook for 2016 — are you an
“THE EASIEST THINGS FOR RETAILERS
TO DO ARE TO SIMPLIFY CATEGORY
LAYOUTS AND PROVIDE NAVIGATIONAL/
EDUCATIONAL INFORMATION. MANY
RETAILERS ARE CURRENTLY EVALUATING
THE FLOW OF THE SHOP AND HOW TO
BEST POSITION ITEMS WOMEN WANT
IN A WAY THAT BOTH ENHANCES AND
IMPROVES HER SHOPPING EXPERIENCE.”
— Todd Hutsko, Fleet Laboratories
optimist, a pessimist or undecided?
CURRAN, GSK CONSUMER HEALTHCARE: Opti-
mistic. GSK Consumer Healthcare is coming
off a successful 2015, with significant growth on
many of our brands and an incredibly successful
Rx-to-OTC launch of Flonase allergy relief. We
look forward to a successful 2016 and beyond.
SLAGER, PFIZER CONSUMER HEALTHCARE: Op-
timistic. I’ll remain optimistic because of the
team we have at Pfizer — the power of our
brands — and the partnerships we have with
our customers.
HUTSKO, FLEET LABORATORIES: I am very
much an optimist. The trends are in our favor, and more consumers continue to put their
trust into OTC products than ever before. I do
not see that trend changing.
The SEAL program (See. Educate. At Last.), which J&J Consumer created in partnership with Rite Aid, helped make core OTC
categories easier to shop.
6 • MARCH 2016
VERNIMB, MOBERG PHARMA: Very optimistic.
Moberg invested significant dollars in consumer research in 2015 to hit the ground running with the relaunches of Kerasal and Balmex in early 2016. We are already underway
and seeing very promising early results. DRUGSTORENEWS.COM
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Switch, self care products buoy sales
OTC AND NATURAL SUPPLEMENT MARKET*
Section by Michael Johnsen
Sales of OTC medicines are on a significant
upswing, growing by approximately $2.7 billion in dollar volume to $44 billion between
2014 and 2015, according to data culled from
IRI. More than 10% of that significant growth
can be attributed to the launch of Flonase,
GlaxoSmithKline’s nasal corticosteroid, which
brought in $294.3 million between its launch
on Feb. 4, 2015, and the 10 months ended Nov.
29, 2015.
And judging by the fact that a lot of that
Flonase sales contribution was incremental to
the category — Chattem’s Nasacort Allergy 24
HR generated $139.4 million for the 52 weeks
ended Nov. 29, 2015, representing an increase
of 7.3% — McNeil Consumer’s most recent
launch of Rhinocort to the 2-year-old nasal
corticosteroid allergy space may represent another boost to the category.
That’s not all that will be driving sales higher. As indicated by the eight OTC disruptors on
the following pages, self care should continue
to be a boom category. For example, the Hispanic and baby boomer consumer groups are
predisposed to shopping for OTC solutions.
Favorable demographics notwithstanding, just
about every American is contending with higher
healthcare costs these days, and that means a value-laden industry that helps mitigate those costs
by reducing trips to the doctor and improving
health resonates well with consumer checkbooks.
Disruptive technology both on and off the
shelf also favors more sales in the OTC sector.
Digital shelf talkers that can actually interact
and engage consumers at the point of decision should provide marketers with a new and
exciting tool to entice merchandising, and the
increasing convenience of automatic replenishment services should give many categories
addressing chronic conditions a boost.
The improved efficiency and functionality
of wearable diagnostics and health tracking
apps will also disrupt the marketplace by encouraging healthier behaviors and driving the
sale of better-for-you snacks. And in the case of
many of the activity trackers reaching the market, which include a diagnostic that measures
how well the user sleeps, improved awareness
7 • MARCH 2016
TOTAL = $44 BILLION
INTIMACY HEALTH10
$0.9/2.0%
DIAGNOSTICS
SMOKING CESSATION
$0.9/2.0%
9
$1.1/2.5%
FOOT CARE
MISCELLANEOUS
HEALTH REMEDIES 8
$1.2/2.7%
SLEEPING REMEDIES
$0.7/1.6%
FEMININE CARE11
$0.6/1.4%
$1.4/3.2%
INCONTINENCE7
$1.7/3.9%
COUGH/COLD/
ALLERGY/SINUS1
$8.9/20.2%
EYE CARE/EAR
CARE 6
$2.0/4.5%
FIRST AID 5
$3.1/7.0%
VITAMINS
$6.6/15.0%
DIGESTIVES4
$4.2/9.5%
PAIN RELIEF3
$4.7/10.7%
WEIGHT LOSS/
NUTRITIONAL MEAL
REPLACEMENTS 2
$6.0/13.6%
* Sales in billions, percent reflects share of total OTC/natural health segments
1 Includes hand sanitizer, chest rubs, humidifiers, cold/allergy/sinus liquids, cough drops, cough syrup, nasal products, cold/allergy/
sinus tablets, cold sore medication; 2 Includes weight control/nutrition liquid/powder, weight control candy/tablets, energy shots,
nutritional/intrinsic health value bars; 3 Includes external analgesic rubs, internal analgesics, heat/ice packs, electrotherapy device; 4
Includes motion sickness, gastrointestinal tablets, gastrointestinal liquids; 5 Includes first aid tape/bandage/gauze, first aid kits, muscle/
body support devices, first aid treatment; 6 Includes ear care products and ear drops/treatments, eye/contact lens care products;
7 Includes adult incontinence, urinary bladder control; 8 Includes hemorrhoidal cream/ointment/spray, hemorroidal remedies, lip
treatment, caffeine tablets/liquids, epsom salts, lice treatments, wart removers; 9 Includes home health care/kits, family planning; 10
Includes sexual health, personal lubricants; 11 Includes vaginal treatments, all other feminine hygiene/medical treatments;
Source: IRI for the 52 weeks ended Nov. 29, 2015, across total U.S. multi-outlet (supermarkets, drug stores, mass market retailers,
military commissaries and select club and dollar retail chains)
around the benefits of a sound night’s sleep
could ignite sales in a category growing at a
rate of 8.3% to $670.1 million for the 52 weeks
ended Nov. 29, 2015, according to IRI.
Americans were recently encouraged to pursue optimal nutrition, including through the
use of supplementation, with the most recent
release of the 2015-2020 Dietary Guidelines for
Americans by the Department of Health and
Human Services. In the past, the Dietary Guidelines encouraged optimizing recommended nu-
trient intake primarily through diet. The most
recent guidelines recognize several important
nutrient shortfalls, however, and have changed
their tune slightly by encouraging supplementation across several categories.
And switch — the historic disruptor in the
OTC space — may once again help invigorate
sales. According to a leading switch expert
from the Kline Group, possible switch categories on the horizon for OTC include migraine,
sleep aids and erectile dysfunction.
DRUGSTORENEWS.COM
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BREAKTHROUGH BRANDS
‘Healthy’ mix of new, old brands top charts
The top 10 list of breakthrough brands —
brands either introduced within the 52 weeks
ended Nov. 29, 2015, or brands experiencing
at least triple-digit growth in that time frame
— features a healthy mix of new-to-market
brands and product resurgences. Here, Drug
Store News breaks down the new and the old.
Flonase
GlaxoSmithKline’s
Flonase is a switch
product that many industry experts point to
as the model of switch.
“[GlaxoSmithKline’s] execution was one of
the best in the industry,” Robert Sanders, EVP
healthcare practice leader at IRI, told DSN.
“They got distribution faster [and] more broadly than most others have in recent history.”
Always Discreet
CPG
giant
Procter & Gamble
in 2014 returned
Always Discreet
to the adult incontinence category with 27
SKUs on shelf after a 16-year hiatus. As many
as 1-in-3 of the nearly 13 million women with
sensitive bladders currently do not use any protection products, according to a P&G poll.
Breakthrough brands
BRAND
SALES*
Flonase
Always Discreet
% SALES CHG
UNIT SALES*
$294.3
NA
15.5
NA
149.0
276.8%
18.8
233.0%
Theraflu
78.9
133.5
9.7
125.4
Quest Bar
69.9
580.2
24.8
536.4
Aleve PM
50.8
235.2
6.4
209.6
Slim Fast
50.6
NA
6.2
NA
Prevagen
41.7
377.1
0.9
335.6
Tylenol PM
40.1
589.7
5.5
586.7
Idea Village Copper Fit
34.0
302.3
2.9
233.8
Alli
$27.2
99.9%
0.4
84.7%
* In millions
Source: IRI for the 52 weeks ended Nov. 29, 2015, Total U.S. Multi-Outlet (supermarkets, drug stores, mass market retailers, military
commissaries and select club and dollar retail chains)
eliminate metabolic disease. Everywhere. Can’t
be done? President Tom
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Theraflu
If what GlaxoSmithKline
is doing with Theraflu in Poland and Switzerland is any
indication, expect Theraflu to
continue on its upward sales
trajectory in the United States.
Theraflu recently made news with what is being
described as the world’s first interactive outdoor
ad capable of taking a person’s temperature
with a thermal imaging camera and generating a
thermos-scanner “selfie.”
Aleve PM and Tylenol PM
Bayer entered its
powerhouse analgesic brand into the PM
pain-relief space in
fall 2014 with the launch
of Aleve PM, and the
brand has been dropping into the baskets of
sleep-seeking shoppers ever since. Couple that
new product launch with the reintroduction in
2014 of McNeil Consumer’s Tylenol PM, just
a few spots below Aleve PM on DSN’s breakthrough products chart, and you have a lot of
messaging addressing consumers with chronic
pain in search of a good night’s rest.
Quest Bar
Quest Bar is more than just the latest sports
bar craze, they’re a company on a mission —
Prevagen
In December 2014, Quincy Bioscience rebranded its website in support of memory supplement
8 • MARCH 2016
% UNIT CHG
Prevagen, and the brand
has generated a resurgence
in sales since. The cognitive supplement market
holds a lot of promise. Data
from Nutrition Business Journal recently sized the
opportunity at $1.2 billion in 2014, and expects the
demand to grow to almost $1.5 billion by 2020.
Copper Fit
The buzz surrounding
copper-infused first aid
products has led retailers
and suppliers alike to step
up their promotions for
these items, such as Idea Village’s brand Copper Fit. Last year during the first week of June,
data compiled by ECRM showed that Idea Village’s Copper Fit was the third-most promoted brand of elastic wraps, supports and braces.
Alli
GlaxoSmithKline
successfully
returned
its
weight-loss brand Alli with
new anti-tampering packaging to store shelves in February 2015 following
almost a year off of store shelves. And Alli marketers are wasting no time going after millennials
with a social media-friendly marketing push.
DRUGSTORENEWS.COM
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COUNTER TREND REPORT
OUT-OF-POCKET COSTS
Healthcare costs drive patients to OTC aisles
The continual increase of out-of-pocket costs associated with health care is a healthcare system disruptor that is
driving more consumers toward value-based health care.
According to a recent Nielsen presentation at the National
Association of Chain Drug Stores Regional conference, 48%
of Americans felt the pain last year with an increase in their
out-of-pocket costs.
Annual out-of-pocket healthcare costs have jumped more
than 40% just in the past three years, according to the Consumer Healthcare Products Association, from $1,890 per employee in 2011 to $2,649 in 2014. Over the same period, employees’ share of total expenses, which includes both monthly
premiums and out-of-pocket expenses, has increased from
34.3% to just over 37%.
Today, healthcare costs in America are expected to rise by
an average of 5.8% each year through 2024.
For many Americans, however, that increase in cost share
has many in search of optimizing their healthcare spend in
an effort to realize greater value, not paying less to get less.
That spells opportunity for purveyors of OTC medicines and natural health products. Consumer-directed
health plans — such as flexible spending arrangements
and health savings accounts — were the only type of
health insurance plan that grew in 2013, CHPA noted. And
an estimated 62 million people will enroll in a consumer-directed plan or account by the end of 2015 (versus 29
million in 2010) in an effort to draw greater value from
their healthcare expenditures.
According to Nielsen’s Strategic Health Perspectives Survey, 21% of Americans tried an OTC remedy before trying a
new medicine in 2015, and 29% asked either their doctor or
pharmacist for a cheaper alternative to a prescription remedy.
When Congress first made HSAs available, these plans
only covered 454,000 lives. Today, 19.7 million individuals
are covered under a health plan that is eligible for an HSA.
Most recently, Rep. Erik Paulsen, R-Minn., and Sen. Orrin
Hatch, R-Utah, introduced the Health Savings Act of 2016 in
an attempt to simplify and expand FSAs and HSAs.
According to the bill, people would be able to use their HSA
account to pay for OTC medicines, as well as up to $1,000 per
year in dietary supplements and homeopathic remedies. “Health Savings and Flexible Spending Accounts give
hardworking Americans more choice and control when
it comes to their healthcare decisions” Paulsen said.
“Expanding and simplifying these plans will provide families with even greater flexibility to save and pay for medical expenses.”
9 • MARCH 2016
MORE CONSUMERS ARE EXPERIENCING COST INCREASES
Change in out-of-pocket costs for medical
care versus the previous year
Level of concern about paying bills not covered by insurance for serious health issue
3%
5%
4%
5%
16%
13%
44%
55%
24%
31%
29%
23%
38%
28%
8%
10%
2014
2015
n Significantly decreased n Somewhat decreased
n No change n Somewhat increased
n Significantly increased
31%
33%
2014
2014
n Not at all concerned n A little concerned
n Somewhat concerned n Extremely concerned
Source: Strategic Health Perspectives Survey, All U.S. adults (2014 n=2501, 2015 n=5037)
RETAIL GROWTH IN HEALTH AND PERSONAL CARE
Change in dollar sales in billions from 2011
$8.4
$6.3
$3.6
Alcoholic
beverages
Health
care
Tobacco/
alternatives
$3.2
Personal
care
$3.1
Household care
$1.7
$1.5
Pet
care
Beauty
care
-$2.0
General
merchandise
Source: Nielsen Answers, Total U.S. – All Outlets Combined (plus Convenience), 52-weeks ended Sept. 20,
2015, versus 4-years ago, UPC-coded
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Over
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COUNTER TREND REPORT
WEARABLES
Consumers increasingly turn to trackers, devices
The wearable diagnostics market that today only captures steps, heart rates and sleep
patterns is set to significantly disrupt the way
people think about their health. There’s a social gamification aspect thanks to the ability
to share and compare personal feats with
friends that actually incentivizes better lifestyle choices.
And the potential market for wearables has
just barely scratched the surface.
Recent research from Mintel found that
the U.S. wearable technology market is experiencing unprecedented growth, with estimated
sales increasing 186% from 2014 to 2015, reaching $7 billion in 2015.
Despite just 1-in-10 consumers owning a fitness tracker (12%) or smart watch (7%), 1-in-6
consumers said they planned to purchase a fitness tracker (16%) or smart watch (16%) in the
final three months of 2015.
As wearables grow in popularity, consumers are turning to these devices — instead of
smartphones — when exercising. With 39%
of consumers trying to lose weight by exercising, nearly 1-in-5 (18%) reported that smartphones are too bulky for use during a workout.
According to Mintel, some 59% of consumers report that they play sports regularly (multiple times per month), including aerobic exercises, with more than half reporting that they
do not currently own wearable technology
More than half of consumers who play sports regularly do
not currently own wearable technology.
10 • MARCH 2016
ACTIVITY TRACKERS HELP MANAGE HEART CONDITIONS
27%
use
Just over 1/4 of heart patients
use an activity tracker
74%
benefit
Nearly 3/4 who use an activity tracker
say it helps manage their heart condition
Source: Healthmine
(55%), representing a sizable target audience
for the wearables market.
“Wearable tech appeals to a variety of
Americans, including athletes, those with
health concerns and tech enthusiasts who
want to own the latest gadgets,” said Billy
Hulkower, senior analyst technology and media at Mintel. “As the market’s rapid growth
in 2015 suggests increased future adoption of
wearable tech, marketers have a unique opportunity to target audiences on the basis of
needs when promoting products, as the many
uses of wearables appeal to a wider variety
of consumer segments than have previously
been expected.”
“Millions of wearable fitness tracking devices will be incorporated into wellness programs
over the next few years,” added Bryce Williams, HealthMine CEO and president. “But
they need to tie into a larger, clinically based
strategy to help consumers know where they
stand with their health, what they need to do
and stay motivated to do it.”
According to a HealthMine survey of 501
consumers with known heart disease released in January, just 27% of people are using an activity tracker. And only 16% say they
are using their tracker to manage their heart
condition/risk.
Yet 74% of those who do use an activity
tracker report the device is helping them cope
with their heart condition.
As for the 69% of consumers with heart
problems who aren’t using mobile health tools
to manage their condition/risk, 36% said they
prefer “traditional” methods to manage their
health, and 34% said they don’t know which
device/app to use. Another 20% said they
don’t own a mobile device, and 15% found
mobile health tools too confusing.
Despite consumers ages 65 years and older being less likely to own a fitness tracker
or smartwatch (9%), adoption of wearable
technology among this demographic is on
the incline, Mintel noted. As many as 13% of
Americans ages 65 years or older said they had
planned to purchase a fitness tracker or smart
watch by the end of 2015. This is aided by their
increased interest in knowing as much about
their health as possible (51% versus 36% of
consumers overall).
“Seniors may not immediately show interest
in wearable tech, but considering their heightened interest in health and wellness, brands
should be optimistic about this demographic,” Hulkower said. “Additionally, we may
see wearable sales for seniors be motivated by
medical practitioners who could use wearable
devices to remotely track patients with heart
disease or other illnesses.”
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DIGITAL SHELF
Retailers revamp in-store experience
More and more, retailers are defining their
success in their ability to reach their consumers seamlessly through whatever channels they
wish to engage, whether it is in store or online,
and have those products available to them
wherever they want them — on the shelf, available for a convenient pick-up or at the doorstep.
It’s omnichannel retailing, and it’s disrupting
how consumers go about their shopping trips.
“When consumers shop online, they receive
an individualized experience — including loyalty offers or recommendations tailored to their
specific preferences,” said Tim Barton, director
of strategic accounts for CitiXsys, a retail supply chain software firm. “While many retailers
have made strides in this area, their efforts have
not yet fully translated to the physical store,
where the consumer is more anonymous.”
According to CitiXsys research, consumers
find e-commerce significantly more convenient
and hassle-free than shopping in physical stores.
As many as 71% of consumers find shopping online more convenient than in a store, and 67% defined online shopping as a “smooth experience.”
Nearly a quarter said that after shopping online,
the store feels like a “let down.”
Unless, of course, you create that individualized
CONSUMER SHOPPING EXPERIENCE
In store
Online
67%
50%
37%
18%
Smooth
Needed
experience improvement
71%
Smooth
Needed
experience improvement
Source: “5 Time-Tested Success Tips From Amazon Founder
Jeff Bezos,” Forbes, April 30, 2013
in-store experience. Whether it’s through Kroger’s
Digital Shelf Edge, BKON’s beacon technology,
Digimarc’s invisible barcode or some other merchandising technology, more retailers are looking
for a digitized experiential component to enhance
and compel the in-store product purchase.
Continued on page 17
Beacon technology
In fall 2015, Target launched a test market of 50 stores deploying beacon technology in an effort to enhance the in-store
shopping experience with digital tools. Target said it will use
the technology to trigger deal alerts — including new offers
from its Cartwheel mobile couponing service — and to provide information and recommendations to shoppers, including an alert, for example, about a nearby item that is trending
on Pinterest. That’s the kind of disruptive technology that
can make a customer stop in her tracks, look for that product
on shelf and place it in her marketbasket. “We’re excited to
start using beacon technology to offer real-time, relevant content and services that can help make shopping at Target easier and more fun,” said Jason Goldberger, president of Target.
com and mobile, in a blog on the company’s website. “This is
another way Target is bridging mobile and stores, and using
digital to enhance the in-store shopping experience.”
11 • MARCH 2016
OMNICHANNEL LABELED MORE CONVENIENT
71% of consumers in America and Canada
find e-commerce more convenient
than brick-and-mortar stores
Source: Cloud Contact Center, “Path to Better Customer Experiences in Mid-Market and Beyond,” March 2014. Omer Minkara,
senior research analyst, Contact Center and Customer Experience Management, The Aberdeen Group
Digimarc Barcode
The Digimarc Barcode is a disruptive technology
that can support an omnichannel shopping experience
by encoding an entire package with an invisible barcode. By pointing a smartphone camera at a Digimarc
Barcode-enabled package, consumers can access a
wide range of relevant product information that is easily updated at any time. “Every brand impression is an
opportunity for consumer engagement,” Larry Logan, Customers can access a range of
Digimarc CMO, told Drug Store News. “Our platform up-to-date product information by
is prior-to-store-visit, during-store-visit and post-store- scanning the Digimarc Barcode with
visit.” Mailers and inserts can carry the Digimarc Bar- their smartphones.
code before a visit, he noted, and the package itself carries with it the possibility of engagement both at the shelf and in the home. Digimarc already works with Wegmans
on its private-label offerings with the invisible barcode, and Digimarc recently collaborated with Perrigo to provide Digimarc Barcode services to its retail customers. DRUGSTORENEWS.COM
Over
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COUNTER TREND REPORT
REPLENISHMENT DEVICES
Smart replenishment devices sweep CES
on hand runs out.
Smart replenishment devices were all
And Amazon’s Echo, a $180
the rage at CES, which begs the quesdevice that sits in the living
tion: Just how long will it take for
room and that can order items
replenishment services, such as Amon voice command, resonatazon’s Dash or Echo, to change the
ed with consumers watching
way consumers purchase such OTCs
the 2016 Super Bowl this year
as VMS, pain relief and other items?
with a commercial featuring
The answer? Not long at all.
Alec Baldwin, Dan Marino and
According to a Path to Purchase
Missy Elliot.
Institute survey of consumer prodAlready there are companies,
uct marketers, 18.7% identified
such as AdhereTech and SMRxT,
automatic replenishment as the
AdhereTech smart pill bottle
that are developing “smart” pill
e-commerce fulfillment method
that had the greatest potential to impact fu- bottles that order refills automatically.
AdhereTech manufactures a smart pill botture sales.
Whirlpool at this year’s 2016 CES an- tle that tracks medication adherence in real
nounced a host of new smart appliances com- time. At the optimal time to take medicine,
ing to market later this year that come pre- the bottle turns blue. If it isn’t opened, it turns
equipped with Amazon’s Dash service. The red and begins to beep. The bottle also anawashing machine, for example, will track how lyzes the patient’s pill usage to see if they miss
many washes it’s completed and automatical- dosages. If so, AdhereTech’s system issues rely order enough detergent before the detergent minders via text message or a phone call.
And SMRxT utilizes a proprietary sensor secured at the base of a pill bottle that can help
determine how many doses of a particular
medicine have been taken. It’s useful to drive
adherence for a monthly prescription, but also
in helping to determine when a patient needs
a “refill” on the OTC pain reliever they keep in
the medicine cabinet.
With the cost of sensors used in many InterSMRxT smart pill bottle
WHICH E-COMMERCE FULFILMENT
METHOD HAS THE GREATEST POTENTIAL
TO IMPACT FUTURE CPG SALES?
3.5%
4.1%
13%
60.2%
18.7%
n Same-day home delivery
n Automatic replenishment
n At-store pickup of online orders
n Offsite pickup of online orders
n Mail-based (multiple-day) home delivery
Base: Consumer product marketers. N= 190.
Source: Path to Purchase Institute/Shopper Marketing
net of Things products coming down, it won’t
be long before technology like this will be scalable across an OTC product line.
Amazon unveils first products available through Dash Replenishment
Amazon in January announced the first
devices available with Amazon Dash Replenishment, including the Gmate SMART blood
glucose monitor.
Brands that want to incorporate Dash Replenishment Service into their connected devices can now easily access the APIs to start an
integration. GoJo, the inventors of Purell Advanced Hand Sanitizer, is launching a development project to connect its touch-free dispensing
systems, equipped with GoJo SmartLink Technology, with the Amazon Dash Replenishment
12 • MARCH 2016
Service. The GoJo SmartLink Technology in
GoJo Soap and Purell Hand Sanitizer Dispensers tracks the supply level of the soap and hand
sanitizer refills and automatically orders a new
supply through Amazon when refills are low.
Dash Replenishment Service enables connected devices to automatically order physical
goods from Amazon when supplies are running low. For example, Gmate’s SMART Blood
Glucose Meter is a device that connects to a
smartphone to make testing blood sugar easy
and convenient. With Dash Replenishment,
testing strips and lancets are automatically ordered when needed so customers always have
the supplies they need to stay in good health.
“With Amazon Dash Replenishment, we
want to make customers’ lives even easier so
they won’t run out of items like laundry detergent, pet food or printer ink again — customers simply activate Dash Replenishment when
they are setting up their connected device and
then rely on Amazon to automatically deliver those everyday essentials,” stated Daniel
Rausch, director of Amazon Devices.
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RX-TO-OTC SWITCH
Migraine, sleep, ED to take center stage
The switch of a medicine’s status from
prescription-only to over-the-counter is perhaps
the most significant disruptor to the self-care
space. It has the power to create entirely new
nonprescription categories, or at least carve out a
sizeable niche, which was the case in allergy with
nasal corticosteroids Nasacort 24HR, Flonase
and Rhinocort, and digestives with protonpump inhibitors Prilosec OTC, Zegerid OTC,
Prevacid 24HR and Nexium 24HR.
But it’s the potential for a new category to
be available to OTC purveyors for the first
time that will have everyone talking in 2016.
That category is erectile dysfunction — Chattem acquired the OTC rights to Cialis from Eli
Lilly in 2014, and patents expire in 2017.
And while it certainly has its merits, it’s not
without its challenges. There is a concern, for
example, around consumers self-selecting an
erectile dysfunction medicine for recreational
versus therapeutic purposes.
“The big health concern is going to be what
if a man with a heart condition takes that recreationally and has a heart attack or some other
serious side effect,” said Laura Mahecha, Kline
Group industry expert in the OTC and natural
health sector. And ED can be a symptom of a
more serious condition. “It’s going to be interesting how it’s approached. Is it going to be as
politically charged as the oral contraceptive
Plan B? I don’t know.”
Beyond erectile dysfunction, migraine and
sleep may be two categories ripe for Rx-toOTC disruption. “GSK has [the migraine remedy] Imitrex, and they switched that in the main
markets in Europe without a prescription. It’s
done fairly well there,” Mahecha said. Other
possible migraine switches include Pfizer’s
Relpax and AstraZeneca’s Zomig.
For sleep, Takeda Pharmaceuticals may be able
to license its Rozerem therapy to OTC manufacturers, Machecha suggested. It doesn’t have the
same risk profile of many prescription-only sleep
aids and may be more effective than the allopathic
or natural alternatives on the OTC market. “This
fills that need for people who want something
stronger but not something addictive,” she said.
13 • MARCH 2016
Projected Rx-to-OTC switch candidates
BRAND
CLASS
COMPANY
AcipHex
PPI
Eisai
Actonel
Osteoporosis
Warner Chilcott
Boniva
Osteoporosis
Genentech
Cialis
ED
Lilly USA
Clarinex
Allergy
Merck
Crestor
Statin
AstraZeneca
Detrol LA
Overactive bladder
Pfizer
Ditropan
Overactive bladder
Janssen Pharmaceuticals
Evista
Osteoporosis
Lilly USA
Fosamax
Osteoporosis
Merck
Imitrex
Migraine
GlaxoSmithKline
Lescol
Statin
Novartis
Levitra
ED
Bayer/GlaxoSmithKline
Propecia
Male pattern baldness
Merck
Protonix
PPI
Pfizer
Relpax
Migraine
Pfizer
Sleep
Takeda Pharmaceutials
ED
Pfizer
Rozerem
Viagra
Zomig
Migraine
Impax Laboratories
Source: Drug Store News research
Nasacort Allergy 24HR, the first nasal corticosteroid product
approved to be sold OTC, generated $139.4 million for the 52
weeks ended Nov. 29, 2015.
Looking at switches that have come to market in the past year, most notable are the nasal
corticosteroids. GlaxoSmithKline launched its
Flonase allergy solution in February 2015, and
in the 10 months following generated $294.3
million and became one of the best-selling OTC
medicines on the market. Chattem’s Nasacort
24HR, the first nasal corticosteroid to reach the
market a year earlier, generated $139.4 million
on growth of 7.3% for those 52 weeks ended
Nov. 29, 2015. This season, there is McNeil Consumer’s Rhinocort, which just launched.
But older allergy SKUs are still growing, too.
Sales of McNeil Consumer’s Zyrtec brand —
still the leading allergy remedy — stands at
$341.3 million on 4.2% growth. Bayer’s Claritin generated $232.9 million in sales on 7.1%
growth; and Chattem’s Allegra represented
$210.5 million in sales on 6.9% growth.
There does, however, appear to be some marketshare shifting across PPIs, the other blockbuster category that has benefited from a recent
switch. Pfizer’s Nexium 24HR, which doesn’t
face store-brand competition until 2017, generated $302.1 million on 90.9% growth, surpassing
sales of Procter & Gamble’s Prilosec OTC, the first
PPI to switch, which stood at $274.3 million for
the 52 week period, down 11.9%. Similarly, sales
of GlaxoSmithKline’s Prevacid 24HR were down
26.2% to $65.5 million, and Bayer’s Zegerid OTC
realized a sales decline of 13% to $28.3 million.
DRUGSTORENEWS.COM
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DIETARY SUPPLEMENTS
New ‘guidelines’ to be basis for education, policy
Dietary supplements are a far cry from being “disruptive” to the American diet.
But the Office of Disease Prevention and
Health Promotion when releasing the “20152020 Dietary Guidelines for Americans”
earlier this year, identified 11 nutrients that
Americans aren’t getting enough of in their
day-to-day diet, and the nutrient professionals
who drafted these guidelines acknowledged
that given the number of under-consumed nutrients in the American diet, that dietary supplements are needed to fill those nutrient gaps.
Well, that’s disruptive thinking right there.
It’s new, and it marks a fundamental shift
in the guidelines because for years the messaging included “eat more fruits and vegetables” and “balance your diet.” But that kind
of messaging hasn’t moved the needle; there
are still significant nutrient depletions that
can lead to disease.
It’s not that recommending dietary supplements as a bridge to help fill those nutrient gaps is a panacea per se, but it might help
nudge that needle in the right direction.
“It reinforces the fact that despite people’s
best intentions on meeting all their nutrient
needs primarily through food, fortified foods
and supplements are invaluable in helping
people achieve in filling those gaps,” Duffy
MacKay, SVP of scientific and regulatory affairs for the Council for Responsible Nutrition,
told Drug Store News.
The guidelines serve as the base for health
Top 20 VMS ingredients
CATEGORY
SALES*
Adult multivitamins
$1,331.0
% SALES CHG
Probiotic/acidophilus
604.4
15.5
38.0
Vitamin B
450.5
5.0
72.4
6.7
Fish oil
426.3
-5.9
44.3
-5.1
Vitamin A & D
368.0
11.8
49.1
7.7
Total vitamin C
336.9
-1.0
46.6
-4.9
Total multi-herbs
304.2
37.8
55.2
37.9
Total calcium
260.9
-8.6
30.2
-9.8
Total Co-Q10
234.0
2.8
13.6
4.9
Glucosamine and chondroitin
231.2
-9.6
15.2
-8.9
Melatonin
178.0
5.3
25.1
4.1
Children multivitamins
166.0
-6.2
22.9
-5.5
-4.8
3.9%
UNIT SALES
UNIT SALES CHG
133.1
3.8%
15.9
Vitamin E
87.5
-5.4
11.4
Cranberry
84.9
10.2
9.9
2.8
Magnesium
77.5
11.8
11.9
13.1
Iron
75.5
-3.4
10.7
-1.5
Vitamin B complex
73.5
-2.8
10.7
-3.8
Amino acid
43.5
-1.0
6.6
-1.7
Lutein
35.2
-0.4
3.8
-0.8
Garlic
32.2
-2.9
5.8
-3.5
TOTAL
$5,932.1
3.9%
684.0
3.5%
* In millions
Source: IRI for the 52 weeks ended Nov. 22, Total U.S. Multi-Outlet (supermarkets, drug stores, mass market retailers, military
commissaries and select club and dollar retail chains)
and nutrition government education and
health policy, MacKay said. “[For example],
federal nutrition education materials used
in school [and] nutrition policies, such as the
WIC program and food stamps,” he said.
“When you recognize a shortfall nutrient and
you mention supplements, that does open the
door for getting those kinds of supplements
into federal programs.”
Continued on page 15
“[RECOMMENDING DIETARY
SUPPLEMENTS] REINFORCES THE
FACT THAT DESPITE PEOPLE’S
BEST INTENTIONS ON MEETING ALL
THEIR NUTRIENT NEEDS PRIMARILY
THROUGH FOOD, FORTIFIED FOODS AND
SUPPLEMENTS ARE INVALUABLE IN
HELPING PEOPLE ACHIEVE IN FILLING
THOSE GAPS.”
The “2015-2020 Dietary Guidelines for Americans,” which was released earlier this year, is available for free download from
Health.gov/DietaryGuidelines/2015/Guidelines.
14 • MARCH 2016
— Duffy MacKay, SVP for scientific and regulatory
affairs, Council for Responsible Nutrition
DRUGSTORENEWS.COM
Over
the
COUNTER TREND REPORT
DIETARY SUPPLEMENTS
Multivitamins most-consumed supplement
The majority of U.S. adults (68%) take dietary supplements, and consumer confidence
remains high, with 84% of U.S. adults expressing overall confidence in the safety, quality
and effectiveness of dietary supplements,
according to the results of the newest survey
commissioned by the Council for Responsible
Nutrition released last fall.
The 2015 CRN Consumer Survey on Dietary Supplements, conducted by Ipsos Public
Affairs, found that people who take a multivitamin represents the highest percentage of
usage among supplement users — both male
(79%) and female (77%) — followed by vitamin D, vitamin C and calcium, three nutrients
that government reports have identified as
shortfall nutrients.
The survey found similar percentages of
overall usage between men and women of
younger generations; however, there appear
to be larger gaps in overall usage between
men and women of older generations, those
considered baby boomers and elders.
DIETARY SUPPLEMENT USE IN U.S. ADULT MEN VERSUS WOMEN BY GENERATION
79%
Elders
68%
74%
Boomers
63%
69%
Generation X
69%
62%
Generation Y
61%
n U.S. adult women n U.S. adult men
n= 2,016
Source: 2015 CRN Consumer Survey on Dietary Supplements
Guidelines
Continued from page 14
That doesn’t necessarily make dietary supplements disruptors, MacKay said. But these
new guidelines also may better inform those
inventors and entrepreneurs who design the
technology that can disrupt the dinner plate.
“I’ve heard of some really cool stuff where
people take a picture of their plate, and the
app actually does a food analysis based on
the photo,” he said. “It’s cutting-edge stuff
that will really help people understand their
intake better.”
The guidelines identified potassium, dietary fiber, choline, magnesium, calcium and
vitamins A, D, E and C as shortfall nutrients; that is, nutrients that are “consumed by
many individuals in amounts below the Estimated Average Requirement or Adequate
Intake levels.” More specifically, the guidelines identified
calcium, potassium, dietary fiber and vitamin D
as “nutrients of public health concern because
15 • MARCH 2016
The new guidelines identified 11 nutrients that Americans aren’t getting enough of in their day-to-day diet; professionals who
drafted these guidelines acknowledged that, given the number of under-consumed nutrients in the American diet, dietary
supplements are needed to fill those nutrient gaps.
low intakes are associated with health concerns,” and suggested supplementing with vitamin D, “especially when sunshine exposure is
limited due to climate or the use of sunscreen.”
Additionally, the guidelines recommended iron supplementation for women who are
pregnant, and folic acid for women “capable
of becoming pregnant and who are pregnant.”
DRUGSTORENEWS.COM
Over
the
COUNTER TREND REPORT
SOCIAL MEDIA
Social media: The ultimate disruptor
PERCENTAGE OF INTERBRAND 100 COMPANIES USING EACH NETWORK
100%
92%
98% 98%
96% 94%
85%
Percentage of accounts
Social media hasn’t just disrupted marketing in the consumer product goods space, it’s
absolutely shifted its trajectory.
The good news for consumers is that effective marketing today has become highly individualized. Retailers and manufacturers run
algorithm after algorithm to determine not
only which medium might be the best way
to send a message, but at what time and in
what context. A successful marketing message
across the many social media platforms today
needs to resonate with their target audience.
They’re interactive and foster more intimate
relationships between product and end-user.
Unfortunately, the bad news for marketers
is that effective marketing today has become
highly individualized. And that’s because
there are 245.3 million adult consumers. And
they don’t all congregate in the same social
media space — it’s becoming a highly fragmented marketing platform.
In November 2015, Facebook reported
roughly 8 billion daily video views, coming
from about 500 million users. According to Dazeinfo, among the top 100
global brands, YouTube is the most widely
adopted social network; all 100 companies
79%
78%
66%
67%
41%
39%
28%
YouTube
Twitter
Facebook
Instagram
Google Plus
Pinterest
Tumblr
n Accounts n Posted in April 2015
Source: Dazeinfo
maintain at least one YouTube channel. Twitter
is the second-most adopted at 98%, followed
by Facebook (96%), Instagram (85%), Google+
(78%) and Pinterest (67%).
What’s more, the majority of adult consumers today are millennials (83.1 million, according to the U.S. Census Bureau), who are much
more enmeshed in social media outlets than
their baby boomer parents (who only number
75.4 million).
According to the latest Pew Research Center
report on social media use, young adults (ages
18 years to 29 years) are the most likely to use
social media — 90% do. That compares with
the nearly two-thirds of American adults (65%)
who use social networking sites, up from 7%
when Pew Research Center began systematicalContinued on page 17
RLA Collective helps OTC marketers navigate social landscape
There are many challenges marketing
through a social media platform.
First, like anything else in the 21st century,
it’s a fragmented landscape. Gone are the days
when you could reach half of the consumer product goods-buying population with a
snarky advertisement on the Ed Sullivan Show
that would be certain to become watercooler
conversation fodder the next day.
Second, you’ve got to do it. Successful marketing is all about following the eyeballs. And
the eyeballs today are spending an average of
1.72 hours every day engaging their social media sites, according to GlobalWebIndex.
So Drug Store News conferred with an agency that has been helping OTC marketers nav-
16 • MARCH 2016
igate social media since the beginning — RLA
Collective (formerly known as Robin Leedy
& Associates) — on the three factors OTC
marketers should be considering when spitballing their social media brand strategy.
1. Remember that social media is about engagement, not reach; it’s about building
a relationship, not conducting a transaction. “Bringing empathy into the OTC
environment versus problem solution is
really important for social media. The
most historically [successful campaigns],
when we really ‘get’ the consumer, they
respond,” noted Alyson O’Mahoney,
EVP RLA Collective. “And then they’re
open to those commercial messages. … If
Stopain Migraine Topical Pain Relieving Gel uses Facebook as
a platform to engage customers and build brand awareness.
you’re putting your traditional media in
social, you’re not doing it well.”
2. Don’t think in terms of marketing dollar in, sales dollar out. Think in terms of
Continued on page 17
DRUGSTORENEWS.COM
Over
the
COUNTER TREND REPORT
Social media
Continued from page 16
ly tracking social media usage in 2005.
But that’s not to say you can’t reach baby
boomers through such sites as Facebook, too,
as usage among those ages 65 years and older has more than tripled since 2010 when 11%
used social media.
Today, 35% of all those ages 65 years and
older report using social media, compared
with just 2% in 2005.
Digital Shelf Edge
Continued from page 11
Kroger in Kentucky is testing its Digital Shelf
Edge, which digitizes the inch of shelf beneath
each product with pricing information and, where
appropriate, allergen information. The technology not only saves labor in having a store clerk
update pricing at every shelf each week — that is
RLA Collective
Continued from page 16
the long sell, but deliver on the brand
promise today. “The truth is this generation coming up now expects you to
respond,” O’Mahoney said. “When you
ask about the ROI on social, … I don’t
know that social media campaigns today will sell product today, but it might
sell product four weeks from today because of the relationship that gets built.”
now a back-end capability — it has the capacity
to directly interact with the consumer. “[Digital
Shelf Edge] brings rich video and digital media
content to the shelf edge of our stores right at the
point where product selection is made,” Keith
Dailey, Kroger director of media relations, told
USA Today last fall. “Down the road, we’ll have
Bluetooth technology enabled within the Digital
Shelf Edge,” he said, that can be used to commu-
3. Take a 360-degree approach at the overall brand marketing campaign, and
determine how to best link one media platform to the next. “How do you
make this post lead to this? It needs to
be a constant web being woven,” O’Mahoney said. “When things start to live
alone, that’s when you lose the mojo. …
Every brand has a story. The main thing
is telling that story well and getting
people who use the brand to tell their
stories back.”
nicate directly with individual shopper. “That is
the kind of innovation
that, over time, this foundational technology will
allow us to experiment
with and provide even
more benefit to our customers,” he said.
Kroger’s Digital Shelf Edge
could save employees time
while also forging a digital
connection with customers.
The most important topics
aren’t always in the headlines.
They’re in the
conversation.
We want to hear
from the leading
influencers
of the trade.
Share your views and connect with
colleagues across the industry for valuable
networking opportunities.
Join DSN on LinkedIn & Twitter.
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twitter.com/drugstorenews
17 • MARCH 2016
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