Since the days of “take two and call me in the morning,” the internal analgesics category has remained a high earner, in part by making slight changes based on consumer preference.
Supermarkets that follow these trends and merchandise accordingly are set to continue gaining fresh profit from the less-than-fresh category, retailers and wholesalers told SN. Internal analgesics command $2.3 billion in sales for supermarkets, drug stores and mass merchandisers excluding Wal-Mart, according to Information Resources Inc., Chicago.
For starters, the pharmacist — whose role has been expanding right alongside that of internal analgesics to include active responsibilities like drug therapy — is a strong ally for the category.
“We keep the internal analgesics literally right in front of the pharmacy,” said Nick Barainca, director of nonfoods, Scolari's Food and Drug Co., Sparks, Nev. “Most consumers think of the pharmacist as their doctor, so the biggest thing you can do to increase sales, if your pharmacist believes in the product, is to encourage them to talk about it with customers.”
Harvey's Supermarkets, Salisbury, N.C., also tries to locate HBC items like internal analgesics as close to the pharmacy as possible, according to Roy Wilson, the director of pharmacy. “Our pharmacists make recommendations every day on things like aspirin therapy,” which many doctors advise for patients combating heart disease.
Increased pain-relief sales and pharmacist involvement are driven by the aging American population. “I am sure pain-relief sales are impacted by active lifestyles being led by seniors,” said Steve Paul, director of nonfoods, Affiliated Foods, Amarillo, Texas.
The entire category's dollar sales increased 6.2% from a year ago for the 52 weeks ending May 20, according to IRI.
LOW-DOSE GROWTH
Partially responsible are the products that target the aging demographic, one nonfood director with a Southeastern retailer told SN. Low-dose aspirin, or alternatively children's chewable aspirin, has experienced tremendous growth due to a high number of Baby Boomers beginning regular aspirin therapy as a preventative measure against heart disease, the retailer said.
One of the most noticeable effects of this trend is the merchandising of children's aspirin products not with the kids' remedies, but next to the arthritis remedies, the retailer said. “I place the products in brands blocked by usage, starting with arthritis and ending with Aleve.”
Children's Motrin from McNeil Consumer Products, Morris Plains, N.J., is leading the liquid segment of the internal analgesic category with $68.7 million in sales. This number beats the entire feminine internal analgesics segment, which totaled $61.7 million in the same period. Internal analgesics in tablet form made $2 billion.
Thanks to those leading an active lifestyle, “Aleve and Advil sales are very strong,” the Southeastern retailer noted.
Advil was the second-best-selling tablet in the category at $300 million. The front-runner was private-label brands, making $470 million.
STORE-BRAND RECOGNITION
“Private-label internal analgesic products have a high share and market penetration, and perform very well in part because this is a mature category,” said Tony Harrington, director of program management, Topco Associates, Skokie, Ill., a privately held cooperative owned by supermarket retailers, wholesalers and food-service companies.
Consumers have developed extensive knowledge regarding these products and their uses, making them familiar with the generic names ibuprofen, naproxen and acetaminophen, and they have confidence buying products with these ingredients, which further supports sales of store brands, he explained.
“Private-label [internal analgesics] are some of our top performers,” Paul of Affiliated Foods said.
Items that are considered maintenance products with high levels of repeat purchases are great private-label candidates, Harrington said. “Internal analgesics is a frequent-purchase category, providing treatments for chronic pain such as arthritis, as well preventative regimens like healthy heart programs.”
Consumers are getting more comfortable when choosing private-label alternatives across multiple categories, said Michelle Barry, president of Tinderbox, the culture and trends arm of the Hartman Group, a consulting and market research firm based in Bellevue, Wash.
“Much of this is driven by retailers who have offered consumers high-quality experiences in private-label offerings, such as Trader Joe's, which has had a halo effect across categories, including internal analgesics,” she said.
A recent study from market research firm Kline & Co., Little Falls, N.J., found that consumers frequently choose to buy over-the-counter medications at mass merchandisers rather than other outlets because of the low costs. The survey of nearly 1,000 consumers — “U.S. Consumers' Perceptions of OTC Drugs 2007” — found this trend to be true across all categories of OTC products, including internal analgesics.
CHANNEL CHOICES
Although many supermarkets do not have the bargaining power of mass merchandisers like Wal-Mart, aggressively merchandising lower-priced private-label brands can help make up some of the lost share, said Laura Mahecha, industry manager of the health care practice for Kline's market research division. “If food stores were to invite more comparisons of their private-label offerings and national brands with shelf talkers, consumers would react to that difference in price.”
In addition to price, consumers participating in the study did cite convenience as a factor. “In terms of how consumers select a retail channel to purchase OTC products, not having to make a separate trip was appealing,” she said.
Another way to add to the convenience of buying internal analgesics is to merchandise them in a way that won't confuse customers, retailers said. Because the category has so many types of products, organizing based on symptom makes the most sense.
“It is important to keep types of remedies grouped for their differing characteristics. Beyond that, brand grouping is important. Less important is delivery systems,” said Paul.
“Categorizing by type of remedy seems to help our customers choose the right product for them,” said Preston Phillips, nonfood manager of Day's Market Place, Heber City, Utah.
Barry suggested a similar approach. “Consumer shopping behavior tends to vary from channel to channel, which requires different strategies. However, we do find that consumers currently tend to organize their thinking about analgesics according to type such as aspirin and ibuprofen.”
The Southeastern retailer's method of placing internal analgesic in brand blocks based on usage has proved effective. “I have seen a tremendous lift by using this best-practices method.”
Smooth Move
Supplements aimed at soothing sore joints and homeopathic pain remedies are gaining in popularity without stealing share from internal analgesics, retailers and other industry sources told SN.
“Joint supplements are occupying more space and starting to sell more,” said Preston Phillips, nonfood manager of Day's Market Place, Heber City, Utah. “They are definitely becoming more of a preventative measure. However, they aren't taking from the internal analgesics' share, but rather, they are complementing each other.
“If people are used to taking something and they know it works, they will stay with it. People have just added the supplements.”
The most mainstream type of joint supplement on the market is a combination of the amino sugar glucosamine and the protein chondroitin sulfate. However, Scolari's Food and Drug Co., Sparks, Nev., has just started carrying a new type, said Nick Barainca, director of nonfoods.
“We just picked up an omega 5 product called AlphaFlex from a company [Sierra Life Sciences] in Reno, Nev.,” he said. The retailer will be arranging a meeting between its pharmacists and the supplement manufacturer so the pharmacists will better understand the how the product alleviates swelling that often causes joint discomfort.
“We want our pharmacists' opinion and we want them to understand the product fully so they can help our customers.”
Homeopathic remedies, which are meant to address the root of a medical problem and trigger the body's natural healing process rather than medicate the problem, are also becoming widely available at mainstream channels such as supermarkets, said Michelle Barry, president of Tinderbox, the culture and trends arm of the Hartman Group, a consulting and market research firm in Bellevue, Wash.
“Homeopathy is perceived to have no negative side effects and to be low-risk,” she said.
“We have seen significant sales growth in our analgesics line in the last couple years,” said Thao Le, marketing director at Hyland's, a homeopathic products manufacturer in Los Angeles.
Hyland's has found that homeopathic drug products sell best when they are merchandised in line with their traditional counterparts, rather than in a separate supplements aisle, he noted.
In addition, consumers taking a number of prescription and OTC drugs as part of their daily regimen tend to fit a homeopathic analgesic into the mix because it works gently without side effects, he said. “Consumers don't have to worry about drug interactions.”
— W.T.