About Our Industry

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PAGB is proud to represent 48 out of the top 50 consumer healthcare brands.

PAGB members manufacture branded over-the-counter (OTC) medicines, self care medical devices and food supplements. These are the types of products that help you to self care when you’re feeling unwell but you don’t need to see a doctor. In fact, many minor conditions can be treated very successfully through informed use of OTC medicines and with the support of a pharmacist who can advise people about the best way to manage their symptoms.

The consumer healthcare market in 2020

The value of the UK consumer healthcare market in 2020 was £2.6 billion (week ending 2 January 2021)*. Unsurprisingly, like in many other sectors, the consumer healthcare industry felt the impact of COVID-19 on consumer behaviour, ending 4.1% down on the previous year (figure 1).

To better understand this impact, it’s worth looking at how shopper behaviour changed over the year and how it affected different product categories.

Seasonality has always been a big factor in consumer healthcare sales but this year it was the absence of seasonal demand that made all the difference. It was a year in which hand hygiene and masks were widely adopted. What’s more, consumers and their families stayed in the house, socialised via video call and many worked at home. In 2020, the traditional cold and flu season simply didn’t happen. As a result, the cough, cold and sore throat category ended the year 28.7% lower than in 2019, despite an earlier spike in sales (figure 2).

Figure 1 – total market and key categories

Lockdown led to a surge in demand

As the UK edged towards its first national lockdown, and the Government began to instil its core message to ‘stay at home, protect the NHS and save lives’, consumers sought to prepare for the weeks or months ahead.

Sales of consumer healthcare products peaked in March 2020, up 125.8% on the year before. This was immediately followed by a sharp drop, with further (but much less pronounced) fluctuations linked to later national and local restrictions.

Across consumer goods, retailers put in place measures to manage demand, including pausing promotions and multi-buy offers, which may also have affected sales in key categories during the year.

 

Figure 2 – weekly sales vs previous year. This chart shows how demand peaked just before the first lockdown (March 2020)

Figure 2 – weekly sales vs previous year.  This chart shows how demand peaked just before the first lockdown (March 2020)

Consumers adopted new behaviours and priorities

In PAGB’s annual review of 2020, an analysis by NielsenIQ considers a series of shifts in consumer behaviour, some of which is summarised here.

Online and all-in-one-store shopping

Restrictions on store opening and freedom of movement inevitably led to a change in shopping habits. Consumers increasingly went online and signs are that this is likely to continue.

As an overall proportion, online sales in 2020 accounted for 10% of consumer healthcare sales – higher than ever before. This included ‘traditional’ bricks and mortar retailers whose online sales were up 76.3% in 2020 compared to the year before.

People also did more ‘all-in-one-store’ shopping – choosing to make fewer trips outside the home. Nielsen suggests that this changing behaviour could present a longer-term risk for the traditional pharmacy channel and that ‘now, more than ever, shoppers need a clear and unique reason to visit the pharmacy’.

Trust influenced buying decisions

The early signs of recessionary behaviours began to show and may be more evident in the coming year. Consumers look for value and price influences behaviour; however, trust also remains an important factor in consumer healthcare. In the uncertainty of 2020, trusted brands performed better than private label self care products.

Vitamins and minerals came of age

Health and hygiene inevitably moved up people’s priority list in 2020. The definition of health and self care widened to include wellbeing and nutrition. Both healthy eating and supplementation benefitted – the vitamins and minerals category growing 14.3% on the previous year.

The bigger picture

Looking at the market as a whole, beyond the COVID-19 impact, we see that pain relief remains the largest category and one of the few to end the year in positive territory – sales were up 2.7% on the previous year. Allergy products too, while not a large category, continued to do well with a 5.8% increase in sales in 2020. Eyecare and gastrointestinal products had looked promising at the end of the previous year but struggled in 2020, both in negative growth (-7.4% and -4.9% respectively). Overall, this was in stark contrast to 2019 when all categories experienced growth.

Looking ahead

The consumer healthcare industry started 2020 in a good position, and although continued growth was in no way guaranteed, it was impossible to predict the very specific challenges that unfolded. As to what comes next, it is still too early to tell whether consumer behaviour will return to a pre-pandemic ‘norm’ or if social and shopping habits will be permanently changed. Manufacturers and retailers will be watching consumers’ behaviour closely and seeking to meet their changing needs in 2021.

About the data

Nielsen’s OTC read was defined by NielsenIQ in agreement with PAGB and its members. It covers over 75,000 stores, including multiple and independent chemists, grocery retailers and in-store pharmacies as well as impulse stores.

Consumer healthcare market, 2020

*Source: NielsenIQ. Total Market MAT to WE 02.01.21

CategoryValue Sales WE 04.01.20 (£)Value Sales WE 02.01.21 (£)value % change YA
Pain relief£640,872,490658,478,047 2.7
Cough, cold and sore throat£483,086,676344,368,375-28.7
Vitamins and minerals£433,094,768495,164,08214.3
Gastrointestinal£309,514,255294,473,525-4.9
Skin treatments£213,773,307198,193,725-7.3
Smoking cessation£144,882,397139,943,583-3.4
Hayfever£132,998,889140,690,5735.8
Eye care£78,851,19673,030,024-7.4
Sleeping aids£57,082,38357,777,7221.2
Other£247,329,704227,071,889-8.2
Total market£2,741,486,0632,629,191,545-4.1

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Annual Review

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