And as a result of COVID-19 lockdowns and people turning to the internet to procure goods of all types, OTC’s investment in e-commerce leapt forward in 2020, with Zenith expecting online to become an ever more important sales channel over the next few years .
This will place new pressure on traditional distributors such as pharmacies and supermarkets which will likely fuel growth in brand advertising as direct-to-consumer ventures and traditional shops compete to secure customers after healthcare products.
Zenith is expecting digital advertising to rise from 46 per cent of OTC healthcare brand’s total advertising budget to 49 per cent in 2023.
“As we’ve seen in other categories, growing digital share of total OTC ad spend is here to stay as this directly mirrors increased consumer device usage, digital media consumption and online shopping behaviours,” said Zenith Australia national head of digital & data Joshua Lee.
“COVID has thrust the OTC category to embrace new channels of distribution as well as normalizing e-commerce as a popular method of buying.
“As more brands seek to relinquish physical shelf space and diversify through online pharmacies, marketplaces and direct-to-consumer, this will require sustained levels of investment in brand advertising to strengthen top of mind awareness and price premiums over cheaper own-labels.”