As we approach the end of the year, we’re covering trends from key markets in 2022. We’ll recap the state of each industry over the past year, the ad strategies of its biggest players, and what we predict 2023 will hold.
The pandemic had an interesting impact on over-the-counter (OTC) advertisers—and not in the way one might assume.
OTC demand dropped as people stayed indoors, meaning fewer people sought medical help for severe asthma attacks, and seasonal flu cases hit a record low in 2021.
Fast forward to 2022, and the industry is still on unprecedented ground. Most recently, that involved the “tridemic” (a triple threat of flu, respiratory syncytial virus (RSV), and COVID-19).
The shaky ground undoubtedly has pharma companies scrambling to answer the calls of society; their advertising teams are likely doing the same.
Here’s how OTC medicine advertisers have spent through Q3 2022 and what you can expect from them moving forward.
MediaRadar Insights on Over-the-Counter (OTC) Medicine Advertising
In 2022, with pandemic restrictions lifted and people, for the most part, resuming life as usual, OTC advertisers heated up from an unfamiliar chill the year before.
Through Q3 2022, OTC medicine advertisers have spent more than $1.2b, representing a 21% YoY increase from the same time in 2021.
So far, these advertisers have increased their investments each quarter, with Q1, Q2 and Q3 experiencing boosts of 2%, 18% and 50% YoY, respectively.
It’s worth noting that while all quarters increased YoY—in Q2 and Q3, that increase was significant—spending levels have held relatively steady throughout the year, with the total investment hovering between $350mm and $400mm.
The sustained spending could indicate that OTC medicine advertisers have brushed off any lingering concerns and are back to their old ways. In contrast, spending steadily fell between Q1 and Q3 2021, which makes sense given the uncertainty throughout the year.
Key OTC Medicine Advertising
More than 60% of the spending from OTC advertisers through Q3 came from those in five categories: allergy, cold and cough, pain management, sleep aids, and hair growth.
Allergy OTC medicine advertisers, which accounted for 19% of the total investment from this category, increased their spending by 10% YoY, thanks mainly to a 72% YoY increase in Q3 as the allergy season dominated the nostrils and sinuses of millions.
Unsurprisingly, this came after budgets fell by 8% and 12% YoY in Q1 and Q2, respectively.
As autumn makes way for winter and seasonal allergies take a back seat, advertising for these medicines will almost certainly fall—and we’re already seeing that, with budgets remaining flat in September.
Cold and Cough
Although advertisers for cold and cough OTC medicines increased their spending by 71% YoY, their strategies were the polar opposite of their allergy counterparts.
After decreasing their spending in July by 70% MoM from June, August sparked a spending spree that saw budgets rise as temperatures dropped.
To put this in perspective, budgets increased by 86% and 670% MoM in August and September, respectively.
Pain management OTC medicine advertising, which accounted for 18% of the total OTC investment, increased by 18% YoY, thanks to a 54% YoY increase in Q3. (Spending in Q1 decreased by just 1% YoY).
That said, the tides may be turning.
After spending increased in August by 16% MoM to $31mm, these advertisers pulled back by 26% MoM in September.
Given that there’s not a ton of “seasonality” with pain management, the recent decreases could indicate that these advertisers are reallocating their budgets to promote other medicines during Q4 and into Q1.
Advertisers for OTC sleep aids, representing 7% of the total OTC advertising investment, increased their budgets by 121% YoY.
While spending was up every quarter, the significant increase came in Q2, when advertisers collectively increased their spending by 257%.
While it’s hard to pin down why spending increased so much in Q2, it could have something to do with return-to-office policies (RTO) and the significantly reduced time for midday naps.
Hair growth OTC medicines also accounted for 7% of the total investment from OTC advertisers, increasing by 61% YoY.
For most of 2022, spending from these advertisers was up. Q1 through Q3 saw ad investment increase by 54% to 65% YoY.
That said, spending started trending downward in August (by 1% MoM) and then by 18% MoM in September.
Top OTC Advertisers in 2022
There are more than 80 classes of OTC medicines in the U.S.
That said, only a handful of companies make most of them, which is reflected by the fact that more than half of the OTC medicine ad spending has come from six pharma companies.
Through Q3, Bayer, GlaxoSmithKline (GSK), Johnson & Johnson, Nutraceutical Wellness, Procter & Gamble, and Sanofi combined to spend $696mm, or 53% of this category’s total ad investment.
Bayer’s OTC medicine advertising through Q3 was 74% of the $230mm it spent across all categories.
Of those ad dollars, 70% went to allergy medicines, including Aleve, Alevex, Astepro Allergy, Claritin Tablets 24-Hour, and Claritin-D.
Bayer’s approach draws attention when pinned up against the strategies of its competitors, including GSK and Johnson & Johnson, which spent far less to promote OTC medicines.
There are 10 of Bayer’s subsidiaries with upcoming RFP dates through April of 2023:
2. GlaxoSmithKline (GSK)
GSK allocated just 13% of its budget to promote 60 OTC medicines (54% of its total ad investment), including Advil, Nicorette Gum, and Tums.
For GSK, reduced OTC medicine spending could suggest a shift in their strategies, but it could also be a temporary detour as they focus attention and spending elsewhere.
In February, Sanofi and GSK announced they intended to “submit data from their booster and Phase 3 efficacy trials as the basis for regulatory applications for a COVID-19 vaccine.”
GSK also made a PR push to announce Haleon, “a new world leader in consumer healthcare, offering a compelling proposition—to bring deep human understanding together with trusted science.”
17 of GSK’s subsidiaries have RFP dates through April of 2023:
3. Johnson & Johnson
Johnson & Johnson invested 86% of its OTC medicine advertising to promote Pepcid AC, Tylenol, Tylenol Extra Strength Caplets, and Zyrtec Allergy, with each receiving more than $10mm in spend.
Similar to GSK, which moved away from OTC promotion, Johnson & Johnson’s OTC medicine advertising represented only 24% of its overall ad spend through Q3.
This could present a glimpse into their go-to-market strategy in 2023, but it’s likely a reflection of their focus on pandemic-related products and initiatives during the pandemic.
If this is the case, Johnson & Johnson may be primed to increase ad spending as the pandemic fades.
There are 21 of its subsidiaries with predicted RFPs through April of 2023:
4. Nutraceutical Wellness
Nutraceutical Wellness leaned all the way into hair growth, using 100% of its budget to promote Nutrafol, Nutrafol Men, and Nutrafol Women.
According to the data sample, Nutraceutical Wellness increased advertising by nearly 180% YoY, which comes at a time when the hair growth market continues to grow, and new entrants fight for its market share.
Nutraceutical Wellness has an upcoming RFP in February of 2023.
5. Procter & Gamble
Procter & Gamble leaned heavily into advertising its Vicks lines, including Vicks, Vicks NyQuil, Vicks Vapo, and Vicks ZzzQuil, which accounted for 60% of their OTC medicine advertising.
Add Prilosec OTC to the mix, and this group of medications represented 71% of the P&G’s spending on OTC medicines.
The bright spotlight placed on these medications in 2022 suggests a similar strategy and allocation will take shape in 2023.
P&G has 32 subsidiaries that have predicted upcoming RFPs through April of 2023:
Sanofi spent more than $11mm on five of its OTC brands: Allegra, Allegra Allergy 24-hour Tablets, Aspercreme Arthritis Pain Relief Gel, Icy Hot Pro Dry Spray, and Xyzal Allergy 24HR.
Collectively, these brands were responsible for 69% of the company’s OTC medicine advertising through Q3.
That said, the company’s ad strategy may change quickly in 2023 as talks of Sanofi buying out Horizon Therapeutics grow louder. If this buyout goes through, it’ll come following the company’s buyout of Amunix Pharmaceuticals earlier this year.
There are five Sanofi subsidiaries with a predicted RFP date through March of 2023:
What’s in Store for OTC Medicine Advertising in 2023?
OTC medicine advertisers aren’t strangers to volatility.
When the pandemic hit and the demand for their products plateaued or fell, they created strategies to spotlight different products.
With isolation (hopefully) behind us, strategies shifted again—and we’ve seen that in 2022.
OTC medicine advertisers will continue to change with the seasons, but we can all agree that overall, spending will rise as the OTC medicine market expands.
Much of this growth will come from the established players, but other pockets of the OTC medicine world will play their part, too.
Private-label products, for instance, are becoming more popular, as is the promotion of medicines in more niche market segments, like OTC hair growth medicines. As people prioritize health and appearance (perhaps because we’re no longer behind masks), it makes sense that OTC advertisers follow suit.
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