Amazon Expands Consumer Health With Advantage Of Cutting Prices
This article was originally published in The Rose Sheet
E-commerce giant expands consumer health footprint in past six months with launches of generic OTC drug product lines at prices in some cases significantly undercutting competitors. Primary Health and SoundHealth OTC drugs range from a few dollars less to about half the cost of brand name equivalents.
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Amazon will offer savings of 25% on own-brand Solimo purchases starting the weekend of Cyber Monday, among other promotions planned across its dietary supplement and personal-care categories. Meanwhile, Vitamin Shoppe and GNC will be discounting products up to 40% during the typically busy five-day stretch for nutrition and wellness shopping.
Amazon’s Solimo supplement and Basic Care OTC lines unlikely to expand much, says Jefferies analyst Brian Tanquilut. Still, brands are well positioned against retail private label competitors, as most products are priced lower than similar products by Walgreens and CVS.
Amazon’s Solimo supplements and personal care line overall is priced higher than Walgreens' brand but lower than CVS', Jefferies Equity Research Americas found. Solimo could present a formidable threat to the supplements category, but its limited assortment so far and pricing should prevent “material market share shifts” in the near-term, Jefferies says.