The latest b4p t.o.m. Pharma joint study by the Gesellschaft für integrierte Kommunikationsforschung (Society for Integrated Communication Research, or GIK) and the Gesellschaft für Konsumforschung (Society for Consumer Research, or GfK) shows that the market for over-the-counter medicines is picking up again after two years of decline caused by the pandemic. The annually published study examines the OTC market and enables advertisers to plan their media strategically.

‘Covid-19 was the problem before – inflation is the problem now’ is how Walter Pechmann, Senior Project Director at GfK, sums up the situation for the OTC (over-the-counter) products market. This can be seen in the fact that the inflation rate based on identical packs sold* between August and October 2022 was 5.9 per cent compared to the same period in the previous year. With an increase of 5.5 per cent, the prices in local pharmacies have risen less strongly than in the traditionally cheaper online pharmacies, which have recorded an inflation rate of 8.1 per cent, meaning their price advantage waning more and more. In light of this development, the search for possible alternative products in the OTC market will be determined primarily by price in the coming months and years.

Despite the higher sales prices, the OTC market as a whole is getting through the inflation crisis well, which once again shows that people are not holding back on spending when it comes their health. The numbers speak for themselves. In the 12-month period (as of October 2022), a total of more than 930 million packs of over-the-counter medicines were sold – more than at any time since 2016. Overall, all five brand types (price premium, market leader, mid-range brands, value-added generics, price generics) show growth. The winners, however, are the mid-range brands, which regained market share for the first time in a long time in 2022, gaining 0.7 percentage points in comparison to 2021. They hold the largest share of the market at 45.6 per cent. The loser, with a decline of more than one per cent, is the product category of market leaders (market share: 24.7 per cent).

One reason for the positive development of the OTC market is the high buyer penetration (pharmacy customers per month in relation to the total population). This was higher than both the four-year average and the buyer penetration of the previous year throughout almost all of 2022. October in particular stands out – never in the past twelve years has the buyer reach in local pharmacies been as high in this month as it was in 2022, with just under 40 per cent of the population visiting a local pharmacy. The particularly bad cold and flu season played a key role in this. In online retailing, people also tended to stock up on medicines in the past. If the products aren’t used, they eventually exceeded their shelf life and are thrown away, meaning they need to be purchased again if people fall ill. This ensures decent sales figures for the manufacturers, a phenomenon that Pechmann describes as ‘sales growth caused by people throwing products away’.

Advertising remains vital to pushing sales. Advertisements and brand awareness play a key role in the purchase decision especially when it comes to ‘newbies’, or in other words, people who are buying a brand for the first time. One target group that advertisers should keep in mind is people in the middle age segment. Members of this target groups always have a broad mixture of curative and high-priced medicines in their medicine cabinet at home, making them highly attractive to manufacturers.

‘We are dealing with cut-throat competition in this target group segment, which means high media volumes and investments are needed to draw enough attention to a product,’ explains Pechmann. The value of brands plays a major role in the area of acute therapies in particular. ‘Normal colds, the flu and omicron will keep the cold remedy market at a high level for the next two winter periods,’ Pechmann says. Provided they have not already had a stockpile of medicines delivered to their homes, people buying products from the acute sector are less concerned about price due to the large degree of distress they are in and the often short-term need for the products.

^{* Inflation at EAN/PZN level: Change in price for the identical pack of the same brand (= same EA number/PZ number). ‘How much do I more or less pay for the identical pack?’}