The year-end 2022 update from DB6 shows the global retail market advanced by 7.2% in the 12 months to end-December 2022. Globally, this represents yet another strong single-digit result, slightly ahead of the MAT Q3 2022 results (+7.0%). In another somewhat turbulent year, impacted by a surging cough & cold market, post-Covid recovery, global economic crises and continuing conflict in Europe, we look below in more detail at how the market has performed.
- Cough, Cold & Allergy continues to be the key driver behind global growth; the second largest category returned sustained double-digit growth, advancing 18.2% in the current reporting period. Excluding allergy remedies, once again all subcategories observed double-digit increases, with standout performances in cough remedies (+26.3%) and systemic cold & flu and systemic decongestants, both growing at 21.6%.
- Analgesics (+7.6%) was the second-fastest growing major category to year-end 2022, driven by a double-digit increase in systemics (+10.3%), which continues to benefit not only from recommendations for OTC products to treat fever and pain following Covid vaccinations, but the uptick in cold & flu incidence. Topical formats continued on a slowing trajectory (+1.9%), with 4 out of 5 leading markets in decline.
- Gastrointestinals (+5.8%) was the third-fastest growing category, slowing marginally from MAT Q3 2022. Sustained robust performances from typically travel-associated subcategories including antinauseants (+13.4%) and antidiarrhoeals (+10.4%) spearhead the increase, while largest subcategories antacids and laxatives grew more modestly, progressing by 4.0% and 5.1% respectively.
- Lifestyle CHC slowed vs MAT Q3 2022 (+3.7%). The second-largest subcategory, sedatives & sleep aids (+3.1%), generated somewhat muted growth following significant gains throughout the pandemic, offset to some extent by steady growth in the largest subcategory, eye care (+6.5%), owing to growing awareness of device and screen-related dry eye, successful switches and NPD. Ear care was the fastest-growing subcategory and the only one to advance by double-digits (+11.8%), although its modest 2.1% share of the category means that this has minimal impact on the topline.
- Vitamins, Minerals & Supplements (+3.7%) continued to soften to end-2022, with several key subcategories slowing vs the previous reporting period. Immunity-related subcategories maintain positive growth but are abating: immune supplements (+6.3%) and vitamin C (+3.1%) are the best performing of these, while zinc flattens to 0.3%, albeit with a significantly higher value than pre-pandemic times. Elsewhere, ebbing growth in the largest subcategory, multivitamins (+2.5%), has muted overall category returns. Multi-functional ingredient magnesium was the strongest-performing subcategory to year-end 2022, advancing by 10.5%.
- Dermatologicals (+3.2%) remains the weakest major category globally but continued its path of improvement in 2022. Antiseptics & disinfectants remains negative in growth terms (-7.6%) but the decline is weakening as post-Covid correction continues and absolute sales are significantly higher than pre-pandemic levels. Excluding this subcategory, dermatologicals increased by 4.8%, with notable performances in lip care (+10.5%) and lice treatments (+10.2%), both recovering from negative Covid impact.
|(Store Retail) Country||YEAR END 2022 sales (US$bn)||2022/21|
In terms of geographies:
- Europe (+9.5%) was the second-fastest growing major region globally (just behind Rest of World, which rose 9.8% driven by inflationary growth in Turkey), with several key markets maintaining double-digit growth, driven by sustained significant increases in the cough, cold & allergy category (+24.2%), as well as continued robust growth in analgesics (+9.6%). Second-largest market Germany accelerated by 11.7%, with other Big 5 Western European markets similarly displaying solid advances, notably Spain (+13.4%). Romania was the strongest-performing market (+18.0%) in the reporting period and now enters the Top 20 countries globally (18th) for the first time. Owing to exchange rate impact, Russia is now Europe’s largest market — in value terms, the market grew in line with the global rate (+7.2%), although declined by 5.4% in volume terms.
- Americas (+7.0%) saw growth in leading market USA remain below the global rate (+4.9%), but in sales terms the market has now crossed the $40bn mark, ending 2022 with an almost 26% share of global sales ($40.7bn). Sustained robust growth in cough, cold & allergy (+23.2%) helped to offset more subdued returns in other categories, notably a decline in vitamins, minerals & supplements (-1.1%). In Latin America, leading market Brazil continued to improve, ending 2022 with 21.5% growth and sustained increases observed across most major categories: cough, cold & allergy (+51.0%), dermatologicals (24.9%) and analgesics (+18.5%) being the most noteworthy.
- Asia (+5.2%) brightened to year-end 2022. Largest market China (+4.6%) improved over the previous reporting period aided by the relaxation of the country’s lockdown restrictions in early December, and No.2 ranked Japan surged — by its standards — to 5.0% growth, driven by a dynamic performance in cough, cold & allergy (+17.1%). Combined, these markets have a share of almost 70% of total regional sales.
The broader CHC market, encompassing all channels + CBD, grew by 8.2% globally, driven by the continued expansion of e-Commerce. The pandemic accelerated growth in this channel, and while the market is slowing from the 2020 peak, the internet & mail order channel advanced by healthy double-digits (+19.4%) in 2022. The channel now accounts for 16.9% of the broader CHC market (up from 15.3% in 2021).
Nicholas Hall Writes: Consumer health in the store retail sector grew by 7.2% in calendar year 2022, and by 8.2% in all channels. That is an amazing achievement during the third and hopefully final year of the pandemic. We’re still working on our short and long-term forecasts, but we expect that over the next five years CHC in all channels will grow by 6-7%. That is still ahead of the growth rate before the pandemic and a nifty achievement bearing in mind the mega-threats referred to in this column in previous weeks.
One of our internal debates is whether the revival in the consumer health care market was more than a rectification of the hit that Cough, Cold & Allergy took during the pandemic. I was always optimistic and didn’t believe that we were merely putting back lost sales as consumers changed their lifestyle and self-care habits. This is confirmed by the fact that the CCA category is now well above pre-pandemic levels at almost US$33bn vs US$27.9bn in 2019 (store retail only). That gives great confidence, although the question remains whether CCA sales growth is sustainable.
We are pleased to announce that the DB6 year-end 2022 update is now available! Nicholas Hall’s global database DB6 offers over 150,000 pieces of data, with more than 30,000 records covering 13,000+ brands and 3,000 companies across 63 countries. Available as a full subscription or for ad hoc purchases, to find out more, or set up a free demo, please contact kate.fielding-smith@NicholasHall.com.