Six of the top 11 top-selling categories in the drug store channel are outside [image-nocss] the health and beauty care category. Tobacco leads the way with almost $3 billion in sales, an increase of 18% from last year. Cold/allergy remedies, nutritional supplements, headache remedies and chocolate candy round out the top five. In terms of growth leaders, pet care products posted a 67% increase from last year, followed by depilatories and peanut butter. Of the 11 categories showing the strongest growth, eight are foods.
But the leading chains such as Walgreens, CVS and Rite Aid are stepping up their efforts to innovate and bring more customers through their doors. As with grocery stores, private-label products are increasing their share of sales, with store branded cold/allergy remedies, nutritional supplements and headache remedies leading the way. Meanwhile, private-label pet care, laundry detergent and antacids have shown the most growth. Some of the chains are establishing in-store medical clinics, where customers can receive services such as blood pressure screenings, treatment for common maladies and flu shots. Others are making the shopping experience more efficient by re-designing stores and reducing SKUs.
"Drug retailers are feeling the heat from mass merchandisers and other retail channels. Look for drug stores to innovate and evolve with more in-store clinics, competitive store brands, and expansion beyond traditional health and beauty categories," said Tom Pirovano, director of Industry Insights at Nielsen.
Other drug store facts:
Drug store shoppers spend nearly twice as much on cigarettes than on cold/allergy remedies. Drug stores dominate all channels in the sale of contraceptives, generating 64% of sales in the category. The two highest growth categories in terms of share for the drug channel are tobacco and feminine hygiene. The category that has the highest drug channel private-label share: canned nuts (64%). The Cleveland market has the strongest drug store channel representing 8.6% of total sales compared to 3.8% for the United States as a whole. Miami, Boston, New York and Sacramento round out the top five. Denver, Salt Lake City and Portland, Ore., have lower-than-average sales in the drug store channel Drug stores skew to African Americans, households without kids, lower incomes and older households than other channels. Where one lives plays a huge role in the channels one shops: those living in cosmopolitan centers and struggling urban cores spend more of their money in drug stores than those in suburbia or rural communities.
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