Retail CHC growth accelerates to 4.8% in 2021

Below we look at the regional trends from the just published DB6 data on the performance of the global CHC market in 2021, showing how an upturn in Asia-Pacific helped global growth accelerate to 4.8% in the full-year period.

Europe (+3.3%) was the slowest growing region globally, although this does reflect an upturn vs 2020, thanks to robust growth in gastrointestinals (+6.1%) and a return to growth for cough, cold & allergy (+2.4%). Largest market Germany (-0.6%) saw its decline soften, while other Big 5 Western European markets rebounded to growth. Notably, Russia has fallen down the rankings from No.2 to No.4 in Europe, largely driven by devaluation of the Rouble, coupled with a flat year-end result (+1.8%)

Asia-Pacific (+5.6%) had a buoyant performance vs 2020, attributed to advances in largest market China (+6.9%) and a softening decline for No.2 ranked Japan (-1.2%), these markets have a combined share of almost 70% of total regional sales. Sales in China have rebounded somewhat, as harsh Covid restrictions generated a relatively weak 2020 comparator. Despite intermittent restrictions continuing, a relatively free environment has boosted sales across most major categories as consumers seek to remedy all ailments.

Americas (+4.9%) saw a slowdown vs 2020; the US market (+3.9%) has gained momentum throughout the year – finishing well, albeit slower than 2020 – thanks to a robust cough cold & allergy uptick (+6.5%) and notable increases in Lifestyle CHC (+10.8%) and gastrointestinals (+8.9%), more than offsetting the slowdown in VMS and decline in dermatologicals.

In Latin America, leading market Brazil (+11.7%) advanced thanks to double-digit increases in VMS (+16.2%), cough, cold & allergy (+11.6%) and Lifestyle CHC (+11%).

Only one month to go until our 32nd European CHC Conference & CHC Training Academy Workshop! Taking place in Athens on 4-6 May 2022, industry experts from GSK, J&J, Menarini, NielsenIQ and more will explore how as an industry we can move forward with CHC Innovation! Please contact elizabeth.bernos@NicholasHall.com to reserve your place.

Immunity: DSM and Sprim reports highlight evolving consumer needs

According to The Immunity Report, recently published by DSM, some 40% of consumers now buy supplements online. This offers convenience, choice and the chance for shoppers to conduct their own research. The digital space also provides more opportunities for tailored products and services vs the broad support offered in-store. Some 76% of global consumers who find nutrition-genetic testing appealing would do it to improve immunity.

In the digital space, supplements can also be more easily tailored to consumers’ lives and habits via online subscription services, which would interest 62% of nutritional supplement users. These can be based on factors such as demographic, lifestyle or season. As well as tailored convenience for the consumer through immunity products suited to them, subscription services can help brands to keep connected with consumers beyond delivery and learn more about their needs over time. One of the interesting findings in the report was how “pill fatigue” among consumers has led to a surge in demand for other delivery formats like gummies, drink shots and stick packs.

Separately, a recent survey conducted by Sprim involving 1,000+ participants across USA, Mexico and Brazil found that, with the pandemic driving interest in immunity, there has been a profound rise in demand for supplements. However, in a saturated market, consumers are becoming more discerning with their purchasing power.

The Sprim report presented five key takeaways, providing a foundation for companies in the immune support category seeking to serve the needs of this evolving consumer:

  • 61% began or increased their purchasing of dietary supplements for immune support in the wake of Covid-19
  • Scientific / clinical trial evidence was the most important consideration when choosing an immune support supplement
  • Vitamins C & D are the most popular ingredients for immune health
  • While most consumers in Mexico & Brazil purchase their supplements from drugstores, those in USA primarily buy theirs from online mass market stores
  • Feeling “tired & rundown” is the #1 buying trigger for immune supplements across all regions

Now is your last chance to save up to 50% off several Reports titles as part of our special end-of-year Reports saleending on 31 December! To find out more, or to create your custom discounted reports package, please contact melissa.lee@NicholasHall.com.

MAT Q2 2021: Global CHC Market Trends

The latest update from Nicholas Hall’s CHC database DB6 indicates that in MAT Q2 2021, the retail (bricks & mortar) CHC market returned to growth following a decline in the previous reporting period – the first seen since DB6 records began. Overall global CHC sales were up 1.7% to US$151bn.

In terms of performance by geography, the Americas returned to positive growth (+1.3%), with a flat performance in North America bolstered by LatAm markets, including double-digit growth in Brazil (+10.6%). USA remains the clear No.1 CHC market globally, and grew modestly (+0.2%).

Asia-Pacific was the best performing region (+4.8%); while it continues to be impacted by loss of revenue from overseas visitors in key markets Japan (-4.0%) and Australia (-5.5%), high single-digit increases in China and India helped to lift the topline.

Source: Nicholas Hall’s global CHC sales database DB6 (all values at MSP).

Europe continues to decline (-2.0%), still heavily impacted by retraction in CCA and analgesics in Western Europe in particular. Key markets Germany (-8.5%) and UK (-10.8%) fell significantly, although this was partly offset by a positive trend in C&E Europe (+3.6%), with Russia maintaining mid-single digit increase (+4.1%) and Poland returning to growth after a decline in the previous reporting period.

Nicholas Hall Writes: “In 2020 we saw the market grow across the board during the first half, ease back in the second half, perform very badly in Q1 this year and return to growth in Q2. Is this a trend? Is it as simple as drawing the line forward to the point where we regain the pre-pandemic 3.7% retail sector growth rate? We all have our own point of view, but it would be a brave soul prepared to make a firm prediction. So in the best tradition of being a thrusting brand manager, I’m going to hedge my bets until I see the Q3 figures from DB6.

We are pleased to announce that Nicholas Hall’s DB6 mid-year update for 2021 is now available! Subscribers can access over 150,000 pieces of data, with more than 30,000 records covering 13,000+ brands and 3,000 companies across 63 countries. To find out more or to set up a free demo, please contact kate.holdcroft@NicholasHall.com.

NPD roundup: Women’s Health in 2020

To mark International Women’s Day, our blog this week rounds up some of the most notable women’s health NPD activity in the global CHC market in 2020, with examples from all four major regions (Europe, Asia-Pacific, North America and Latin America), as provided by our CHC New Products Tracker service.

Probiotics & prebiotics was a particularly lively source of women’s health innovation, including Farmoquimica’s late 2020 launch of Simbiofem in Brazil, positioned to balance female intestinal flora and claimed to be the first probiotic in the market for women’s health. In Spain, FertyPharma unveiled Fertybiotic Mujer Plus in early 2020, uniquely positioned to improve the fertility of women with PCOS (polycystic ovarian syndrome), while in South Korea Huons launched Elruby Menolacto Probiotics in Q4 2020, offering the benefit of an original formula to help support menopausal women. In the USA, a particularly innovative women’s health probiotic launch was HUM Private Party, with a unique formulation that combines a proprietary women’s probiotic blend with cranberry extract, which is positioned to support healthy vaginal and urinary tract health.

As for digital health solutions, which are profiled in one of the chapter’s of our upcoming Innovation in CHC report, a notable women’s health development in the UK was Velieve (Healthy.io), an at-home service for women to determine if they have a UTI (urinary tract infection). Velieve was test marketed in London first and is available as a kit (containing a urine collection cup, dipstick and colour board), which is delivered within 3 hours of ordering online, and the user is then required to download the Velieve app to guide them through the test, turning their smartphone into a medical device to read the dipstick.

Finally, looking at VMS, there were also several notable women’s health developments in China in 2020, including GSK’s extension of calcium supplement Caltrate with Caltrate Women, Unilever’s rollout of Olly The Perfect Women’s Multi and Eu Yan Sang’s launch of Gold Label Bak Foong Small Pills (a plant-based formula positioned as a treatment to alleviate menstrual pain).

Seize your last chance to save on our forthcoming report from Nicholas Hall’s CHC New Products Tracker, Innovation in CHC 2021. Putting innovation and NPD activity from 2020 under the microscope, click here to pre-order your copy without delay. For more information, or to place your order, please contact Melissa.Lee@NicholasHall.com

Star VMS Performers in MAT Q2 2020

Global sales of vitamins, minerals & supplements in the MAT Q2 2020 period advanced by 5.5%, a further clear upturn vs Q1 2020 and Q4 2019, and a trend that helped to offset the Q2 slowdown for CCA remedies. Faster growth in North America’s vast supplements market (+8.8%) was the primary factor underpinning the accelerating trend globally, helping the region move back ahead of Europe in terms of CHC turnover in Q2.

In this week’s blog, we take a closer look at the VMS brands driving growth at both a regional and country level. In North America, as well as the continued rapid growth of J&J’s Tylenol, two VMS ranges that performed exceptionally well among the regional Top 10 brands were Nature’s Bounty (The Nature’s Bounty Co) and Olly (Unilever). New product development, such as the launch of the Olly Ultra Softgels line in April 2020, as well as the brand’s rollout to Canada in May 2020, have boosted Olly sales.

In Asia-Pacific, the standout trend has been the exceptionally high growth of chyawanprash supplements, up 121% globally – outpacing other fast-growing prevention categories such as immune supplements (+38.6%) and vitamin C (+23.5%) – driven by accelerating demand in India. Dabur Chyawanprash (Dabur) is now India’s No.1 OTC brand, after sales more than doubled in the 12 months to June 2020 thanks to surging demand in H1 as a result of the pandemic, and the brand has now also sneaked into Asia-Pacific’s Top 10 CHC brands regionally.

In Europe, growth was more muted across the board, with Top 10 brands like RB’s Nurofen and Bayer’s Bepanthen driving growth at a regional level. However, focusing on brand performances at a country level in Europe reveals the impact of VMS brands and natural-based sleep aids on growth, with Orthomol (+10.6%) rising fast in Germany, GSK’s single vitamin brand BE-Total (+16.2%) up strongly in Italy, P&G’s multivitamin Bion 3 (+16.0%) advancing rapidly in France and sleep aids Aquilea (+13.5%) and Dormidina (+11.3%) powering Q2 growth in Spain.

As for Latin America, Sanofi’s analgesics brands Dorflex and Novalgina were two of the best Top 10 performers at a regional level, while Bayer’s Redoxon (+65.7%) was the star performer, thanks to soaring demand amid the Covid-19 pandemic. In 2019-20, Bayer rolled out Redoxon Triple Action (vitamins C + D plus zinc; positioned for enhanced immune support) in numerous local markets.

With just under a month to go, there is still time to register to join Nicholas Hall’s Asia-Pacific webinar. On 12 November, Nicholas and other industry experts will explore key trends in the region, including a look at WOW! brands, growth prospects, distribution, the very important topic of sustainability and much more. To find out more, or to register, please contact elizabeth.bernos@NicholasHall.com.

CHC market shows resilience in Q2 2020

In the 12 months to end-June 2020, the global retail CHC market grew by 4.6%. This marked a slowdown vs MAT Q1 (+5.6%), but Celine Waller, Group VP, DB6, said “the market has remained far more resilient than many expected”. A boom in prevention categories such as antiseptics & disinfectants (+38.7%) and immune supplements (+38.6%) has helped to mitigate the effect of “pantry unloading” following consumer stockpiling in Q1, while strong US growth in Q2 offset weaker performances in China and Western Europe.

Western Europe decelerated to 1.2% triggered principally by a decline in CCA as lockdowns and increased hygiene measures resulted in reduced incidence of respiratory pathologies. Low growth in Germany (+1.5%) and the UK (+1.9%) offset moderate declines in Italy (-0.8%) and France (-1.3%).

Asia-Pacific slowed to 2.7% hindered by a weak performance in China and declines in both Japan (-2.9%) and Australia (-1.3%) caused by loss of revenue from Chinese travellers. However, India was up 11.3% driven by chyawanprash, which more than doubled thanks to its immunity positioning.

North America posted a 6.4% upturn with strong US growth spearheaded by VMS (+8.8%) and Derma (+8.4%) – the latter boosted by a doubling in sales of antiseptics & disinfectants.

Central & Eastern Europe achieved growth of 8.6% with inflation-driven growth in Russia (+10.9%) offset by a comparatively weak performance in Poland (+5.2%), while the Middle & East Africa experienced a slight slowdown (+6.9%).

Latin America grew by 11.8% with both Brazil (+12.0%) and Mexico (+11.0%) up by double digits. VMS was the key contributor growing by 16.7% in the region.

We are pleased to announce Nicholas Hall’s Asia-Pacific webinar, which will be held on 12 November! Nicholas will be joined by several regional industry experts to explore key trends in the region, including a look at regional WOW! brands, growth prospects, distribution and much more. For further details, or to register, please contact elizabeth.bernos@NicholasHall.com.

Innovation powers Genomma OTC growth in LatAm, USA

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Ranking among the Top 50 globally and the No.5 CHC marketer in Latin America, Genomma continues to produce double-digit OTC growth. In its recently published Q2 2020 results, Genomma announced a 10.9% rise in net revenue in Q2 to Ps3.6bn (US$160mn). Adjusted EBITDA grew by 13.1% to Ps754.9mn (US$34mn; 20.8% margin). Mexican sales reached Ps1.5bn (US$67mn; +5.0%), while revenue from LatAm markets was up 8.8% to Ps1.6bn (US$71mn). Reversing the downward trend of recent quarters, sales from Genomma’s US operation grew by 47.8% to Ps478.4mn (US$21mn), attributed to a renewed focus on innovation, POS (point-of-sale) presence and A+P.

Overall, Genomma generates 54% of its revenue from OTC products, with personal care accounting for the remainder. Genomma now has a presence in 18 markets, and international expansion has fuelled the fast quarterly growth in its OTC portfolio (+32.2% in Q2 2020 vs Q2 2019), which offset a 6.5% decline its personal care sales. Mexico accounted for 38% of Genomma’s OTC turnover in Q2 2020, and quarterly sales in its home market fell 2.7%, however this was more than offset by 49.8% growth in LatAm sales (excluding Mexico), which accounted for 42% of its OTC portfolio in Q2, and 128.5% growth in USA sales, which now claim a 20% OTC share.

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Source: Genomma’s Q2 2020 Earnings Release

CHC Insight Latin America Assistant Editor, Jen Jones, commented: “Innovation was the buzzword in Genomma’s Q2 statement to investors. In Mexico, new categories include infant nutrition, sanitisers and shaving products, while in Brazil Genomma recently introduced the region’s first at-home HIV test kit. CCA was central to NPD in LatAm, including launches under the Next banner in Brazil, Argentina and Colombia, as well as the rollout of Tukol cough remedy to new regional markets.”

According to our CHC New Products Tracker service, after a quiet year in 2017, Genomma significantly ramped up NPD activity in 2018 and 2019, and this investment is now being reflected in strong organic OTC growth. While Brazil and Argentina were the main sources of launch activity in that period, the US market has also been a growing focus, with line extensions to skin care brands Lagicam (antifungal), Asepxia (acne remedy) and Cicatricure (aesthetic treatment), as well as additions to the Next systemic cold & flu range (Daytime Relief and Nighttime Relief).

Thousands of innovations are launched every year in the global consumer healthcare market, but relatively few offer notable new benefits for consumers in terms of delivery format or formulation. Which new products are breaking through and offering a unique proposition? Where will new product development take the CHC market in future? Contact Melissa Lee (melissa.lee@nicholashall.com) today to pick up your copy of the Innovation in CHC report.

Latin America a ray of CHC light

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As reported in our MAT Q2 2019 update, the Emerging Markets have produced mixed performances in recent quarters, with consumer healthcare growth in both China and India impeded by a relatively low-key cough & cold season and weakening economies. Over the weekend, it was reported that India’s economic growth slowed further in the third quarter, highlighting the depth of the downturn afflicting a nation that was only recently revelling in its status as the world’s fastest-growing large economy. 

One region that continues to produce above-average consumer growth, however, is Latin America – CHC sales grew by 8.3% in the MAT Q2 2019 period – and Nicholas Hall recently returned to São Paulo for our 5th Latin American Consumer Healthcare Conference. Reflecting on his trip, which also included a workshop in Mexico City, Nicholas Hall said “the topics that aroused most curiosity at these meetings were e-commerce, cannabis, probiotics, industry consolidation and, inevitably, regulations, with Brazil travelling in one direction (liberalisation) and Mexico the other.

Strong growth in Brazil has been also been fuelled by higher levels of launch activity, with our OTC New Products Tracker service showing a strong spike in the number of innovations recorded in 2018, totalling just over 250.

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Below is a summary of some of the Key Learnings from our Latin American CHC Conferences:

• As we enter the 4th industrial revolution, it is important to question traditional business models & sales strategies

• Innovation is not limited to NPD (new product development); within an increasingly saturated market with tough regulatory obstacles, we should explore new business models & sales strategies

• Traditional market research methods are deeply flawed but the wealth of consumer data that advancing technologies (such as wearables) provide could be a goldmine of opportunities

• LatAm lags behind other global regions in eCommerce owing to regulatory hurdles, high levels of fraud & a lack of consumer trust in online platforms

• Precision marketing – using online influencers & product placement – can help connect with more clustered consumers

• While HCPs might be interested in features, consumers want benefits!

• Content marketing – particularly focusing on preventive healthcare – could be key to improving low levels of health literacy and the burden this places on national healthcare services

A detailed write-up of both our São Paulo & Mexico City conferences will be included in the next issue of Insight Latin America. To receive a copy of this article, contact Melissa

Food intolerance category shows huge promise

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For the next instalment in our series of blogs on Nicholas Hall’s Infinity Zones for future CHC growth, we take a closer look at the growing issue of food intolerance, driven by unhealthy eating and the rise of processed food with additives, as well as changing diets across the world. Currently a driver of GIs growth, food intolerance has the potential to break out and become its own OTC category, and Nicholas Hall is urging CHC companies to seize this huge opportunity in the face of any future competition that might come from mainstream food companies, as was the case with functional foods.

A 2016 Nielsen study showed a high prevalence of food intolerance across various regions – the percentage of those who say someone in their household has food intolerances / allergies was 22% in Europe, 31% in North America, 34% in Latin America and 42% in Asia-Pacific, with children more likely to suffer than adults. Food intolerances (lactose, cruciferous vegetables, gluten, fructose, etc) can cause a variety of challenging symptoms for those affected, and new product development is catering for this fast-growing market.

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Lactose intolerance is the most established niche, with lactase supplements (an enzyme that helps digest lactose) generating sales of roughly $65mn in 2018. Lactase supplements are fairly well-established in North America and Europe, with J&J’s Lactaid a key brand in the USA, while Latin America – especially Brazil – remains a current hotbed of innovation. Other intolerances are also increasingly being catered for with new products such as GluteoStop (Ineo Pharma) in Germany / Switzerland and Glutenam (Named) in Italy for glucose intolerance, and Fructaid (Pro Natura) in Germany for fructose intolerance.

Marketers of diagnostics and probiotics have also recognised the potential of this category. Lykon has launched MyNutrition 100 in Germany and UK (retailing for between $110-125), an at-home kit positioned to test for food intolerance across the 100 most common foods, while Montefarmaco extended probiotic brand Lactoflorene in Italy in 2019 with Lactoflorene Digest, claimed to promote the balance of intestinal flora that can be compromised by digestive disorders such as lactose intolerance.

Food intolerance will be one of the key topics in our upcoming report, Nicholas Hall’s New Paradigms for CHC 2019: Over the Horizon, written by Nicholas himself! Examine each aspect of the CHC industry in 20 chapters, with a focus on major issues including Regulation, Pharmacy Point-of-Care, M&A, Switch and much more. Nicholas will also unveil in more detail the “infinity zones” he has identified as being crucial to the future growth of the industry. In addition to this, you can upgrade your purchase to include a customised in-house presentation or webinar with Nicholas for an additional GB£10,000. To find out more or to place your order, please contact melissa.lee@NicholasHall.com.

East to power global economy in 2019

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According to the latest research from the Economist Intelligence Unit (EIU), several countries in Asia-Pacific, the Middle East and Africa will produce the highest economic growth in 2019, while North America, Europe and even Latin America will lag behind. There are some exceptions to this trend (like Poland and Ireland in Europe, which are forecast to outperform the global economy in 2019) but the general picture shows that the highest GDP growth will be in the east.

Although there are concerns about the economic slowdown in China – see our blog just before Christmas and the recent letter from Apple CEO Tim Cook to investors – the country is expected to remain among the best-performing economies in 2019, with a growth forecast of 6.3%. The EIU revised up slightly its China forecast for 2019, following the agreement reached between the US and China at the G20 to delay planned tariff actions. However, it remains uncertain whether a bilateral trade deal will be reached.

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China’s troubles may actually be providing a boost to neighbouring Asia-Pacific markets, such as Vietnam, which offer an alternative manufacturing location. Also, as we’ve highlighted on the blog previously, several African markets have likewise been boosted by their growing status as manufacturing hubs, notably Kenya. As for India, it is forecast by the EIU to be among the Top 5 fastest-growing economies in 2019, continuing its strong 2018 upturn – according to the latest OTC DASHBOARD data for the MAT Q3 2018 period, India is the fastest-growing OTC market in Asia-Pacific, up 8.8%.

At the other end of the scale, key Latin American markets Venezuela and Argentina are forecast to be among the Top 5 worst-performing economies in 2019, while Mexico and Brazil are also expected to perform below par this year. However, high inflation has helped to boost OTC growth in these markets. As for Europe, several western European markets are forecast to produce low growth, while Japan, Turkey and South Africa are all expected to produce growth in the 0-2% range, with the US performing slightly better.

Join Nicholas Hall and The CHC Training Academy in Vietnam on 28 February. Focusing on the central theme of Winning Together in Consumer Health, this unique workshop will enable you to develop essential skills to succeed in the new era of collaborative partnership approaches between retailer and supplier for strengthening categories together, plus deep insights on key stakeholders. Don’t delay — book your place before 17 January to save with our generous early bird discount! To find out more, please contact elizabeth.bernos@NicholasHall.com