Over-the-counter (OTC) medicines and nutritional supplements play an increasingly vital role in America’s healthcare system. Sales continue to grow in spite of the recent recession, as customers seek cost-effective treatment options. Some OTC categories have even benefited from the economic downturn.
Over the past few years Rx-to-OTC switch brands have emerged as one of the strongest growth drivers in the market. While the OTC market as a whole is expected to see a modest CAGR of 2.6% over the next five years, future switches are set to explode by nearly 75%, adding more than $1.5 billion in absolute dollars to the OTC market. These products will not only contribute to growth, but also expand the OTC market by adding product categories that do not currently exist.
Organized by the Consumer Healthcare Products Association (CHPA), the annual Market Exchange event that brought together OTC manufacturers, consulting firms, and information service providers, was held last month. Kline’s Healthcare Industry Manager, Laura Mahecha, was in attendance. On focus this year, was marketing accountability, retail and advertising trends for OTC drugs, including current and future states of markets, and growth strategies retailers are likely to pursue.
While at the Market Exchange, Kline met with many companies, both large and small, all of whom were eager to share news about new OTC products that have been launched recently or are currently in development. New OTC product trends are leaning towards non-drug products or “natural” OTCs used to treat and/or prevent ailments typically treated with OTCs.
Companies also have broadened their marketing strategies for OTC brands using a full battery of promotional tools, traditional media advertising, and more targeted advertising on the web, social media sites, and smart phone apps to drive performance of OTC brands.
