Nothing to Sneeze at
Winter is seen by many as a period of sniffles, sneezes and sickness. But to owners of cough and cold remedy brands, the period in recent years has been a healthy season — for sales, that is. In 2013, cough, cold and allergy remedies grew 6 percent to reach $7.6 billion. Euromonitor, Chicago, notes in its May 2014 “Cough, Cold and Allergy (Hay Fever) Remedies in the US” report that a strong cold and flu season was one cause that helped this growth occur.
And the growth is expected to continue. Euromonitor states that cough, cold and allergy remedies are expected to see a 10 percent rise in dollar sales (at constant 2013 prices) to reach $8.4 billion in 2018.
Healthy opportunities
With consumers increasingly switching from prescription remedies to over-the-counter (OTC) ones, retailers are looking to add store brand offerings in a number of OTC subcategories, says Evan Singer, president of Westbury N.Y.-based PL Developments. He points to the allergy subcategory as an area of opportunity for store brands.
OTC asthma remedies also have potential on the store brand side, as a gap exists in the subcategory. But retailers should avoid homeopathic solutions here.
“Homeopathic asthma remedies were added to help fulfill the need,” says Susana Breese, marketing manager with Buffalo, N.Y.-based HealthSource Marketing LLC. “However, the FDA just issued a warning a month ago for consumers to ‘avoid use of over-the-counter asthma products labeled as homeopathic, as the products have not been evaluated for safety and effectiveness.’”
Cough drops, too, are a place where store brands could grow. Marianne Flores, senior research analyst with Marketing Management Inc., Fort Worth, Texas, notes that store brands are underrepresented in cough drops compared to the rest of the cough and cold remedies category.
In terms of product formats, Flores points to growing areas such as dissolving tablets, sprays/mists and powders as areas of opportunity for retailers’ own-brand cough and cold remedies. Although these areas are small compared to the more popular liquids and tablets, all three of them have been growing fast and are underrepresented in the store brand space.
But whatever the product, consumers today want to know that it will work fast and effectively when they purchase it. On the national brand side, Merck’s Claritin Redi-Tabs continued to outperform traditional Claritin in 2013, Euromonitor says, indicating a “substantial demand” for faster-acting products.
Create the right look
Store brands actually are lagging behind the rest of the category in terms of the number of new cough and cold items that communicate claims related to speed of relief and convenience of use, Flores states, citing information from the Global New Products Database of global market research firm Mintel.
“[Retailers] should consider on-pack claims that speak to the speed of relief and convenience in order to appeal to consumers,” she states.
Retailers also should take pride in the clout behind their banner name and use that name as the brand name, says Ketan C. Mehta, MD, CEO and founder of NeilMed Pharmaceuticals Inc., Santa Rosa, Calif. He notes that doing so allows people to know where they can purchase the product if they use — and approve of — it at a friend’s house.
But retailers could go beyond brand name and claims to get packaging to attract shoppers’ attention. Breese notes that instead of matching the national brands’ look, retailers are creating their own “sleeker, more up-to-date look” for packaging of store brand cough and cold remedies to give the look of a “legitimate brand” rather than a generic product.
To help retailers differentiate their cough and cold remedies, PL Developments launched its Clear Bottle Program, which allows retailers to package their own-brand over-the-counter medications in see-through bottles, Singer states.
“Firstly, the clear bottles speak to the quality of the store brand offering — the retailer isn’t afraid to show the consumers what they are buying,” he says. “Secondly, [they allow] our retailers to catch the eye of the shopper out of the clutter of white boxes and bottles.”
And just as its contents should be easy to consume, packaging should be easy to open, Flores points out.
Help them choose
Of course, store brand cough and cold remedies typically are merchandised next to their national brand counterparts, Breese notes, as this allows for price and ingredient comparison. But retailers could do more with their merchandising to better sell own-brand cough and cold products.
“An interesting concept might be to have a health center, display or end cap of just store brands,” she says.
Simon Bell, vice president of sales and marketing for AGS Brands, Dallas, agrees about the effectiveness of end caps, noting that retailers could easily communicate symptoms and solutions to specific ailments via the displays.
Video displays also could be useful here, allowing shoppers to match their symptoms to the product needed to relieve them. People retain 58 percent of the information they view, but only 10 percent of what they read, Bell adds.
“Have the pharmacist reinforce the message that the ingredients in these items compare to the national brand and will provide the exact same comfort and relief to their specific ailment,” he says.
The videos also could be rolled out to retailer websites and social media accounts, allowing for off-site viewing.
And don’t make price gaps too wide between own-brand and national brand items, Flores warns.
“A wide price gap may give consumers the impression that the private label product is inferior to the national brand product,” she says.
Do consider introducing products in dissolving tablet, spray/mist and powder formats.
Don’t make price gaps between store brands and national brands too wide.
Do create unique-looking packaging to stand out from the competition.
Don’t ignore demand for quick-acting formulations, as consumers want fast relief.