Natural Products: OTC and Personal Care

Understanding the Natural Consumer for OTCs and Personal Care Products

Consumers’ desire for natural products doesn’t pertain only to foods and beverages, but extends into many other areas, including personal care products and OTC medicines. Consumers are increasingly aware of ingredients and seek transparency in labeling for products that will be applied topically or ingested. Environmental concerns, green consciousness, and sustainability are important to consumers who are driving strong growth of natural products in both the personal care and natural OTC markets. The U.S. market for natural personal care products has grown over 7% recently, and the U.S. market for natural OTC medicines has grown over 11%, driven by growing consumer awareness and interest in using these products.

In a recent survey of American adult consumers conducted by Kline, 46% note they used natural OTCs both for prevention of illness and to treat themselves when they are sick. Over time, the use of natural OTCs has increased with 50% of consumers indicating more usage now than one year ago, and nearly two-thirds noting they buy and use natural OTCs more now than they did five years ago. The natural concept is also making waves across various product categories in the beauty and personal care markets. Consumers are becoming increasingly aware of specific ingredients that have become known as “harmful”. As a result, they increasingly opt for products that are natural or, at least, perceive to be natural due to brands’ claims of inclusion of naturally-derived ingredients.

Natural personal care and OTC products are not the niche products they once were found mainly in natural and specialty stores. These brands have been mainstreamed, and the majority of sales are now through drug stores and mass merchandisers. In these mass channels, natural OTC and personal care brands are merchandised alongside traditional, non-natural brands. In beauty and personal care, one of the key growth drivers is the migration of natural brands to the mass market, where key mass retailers allocate shelf space to truly natural brands, driving consumers in their purchase decisions for truly natural versus naturally-inspired brands. Mass merchandisers currently constitute approximately 25% of total distribution of naturally-positioned personal care brands and continue to grow, with solid growth of 10% in distribution in the past year.

Consumers’ interest in immune boosters and organic personal care ingredients has driven regular purchases of natural personal care and OTC brands. Brands such as The Honest Company, Juice Beauty, Emergen-C, and Zarbee’s are popular natural brands that have experienced strong growth recently.

Detailed market assessments of Natural OTCs and Natural Personal Care products can be found in Kline’s comprehensive analyses of these markets.

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