OTC reports better sales across online, c-stores and dollar versus mainstream stores

Over-the-counter (OTC) medicines sales through alternate retail channels have increased by a compound annual growth rate (CAGR) of 9.4% in 2011, compared to2006 , surpassing the overall growth rate of 2.4% through all retail outlets, according to the market researcher Kline.

The US retail sector continues to be consolidated, with a smaller number of large retail chains continuing to dominate OTC distribution, according to drugstorenews.com.

According to the report, three main retail outlets, comprising drug stores, mass merchandisers and food stores, account for about 84% of OTC sales.

Other outlets, such as online, convenience stores, dollar stores and warehouse clubs, account for nearly 15% of the OTC retail market stoking the competition across several categories, the report revealed.

Meanwhile, the online sales saw the highest increase with a CAGR of 16.1%.

Kline’s healthcare practice industry manager Laura Mahecha said growth opportunities within the retail environment need to be explored on individual channel and category bases.

"While some of the alternate channels … can offer opportunity for growth in select categories and for certain brands, several other alternate retail channels ostensibly aren’t prime candidates for an increase of branded OTC sales," added Mahecha.

According to the market researcher, consumers like to stock vitamins, minerals, herbal products and OTC pain relievers products in their medicine cabinets, accounting for a high rate of online purchase.

OTC products for immediate usage, such as allergy relief, cough and cold preparations, and digestive products, are more often purchased at brick-and-mortar stores.