Chattem Hopes To Rouse Unisom Sleep Aid Sales
This article was originally published in The Tan Sheet
Executive Summary
Unisom is alone among Chattem's "big six" brands in not showing sustained sales growth since the firm acquired the sleep aid from Johnson & Johnson
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Unisom is alone among Chattem's "big six" brands in not showing sustained sales growth since the firm acquired the sleep aid from Johnson & Johnson. "We have not figured out how to grow that business yet," President and Chief Operating Officer Bob Bosworth said June 9 at the William Blair & Co. Annual Growth Stock Conference in Chicago. A "big opportunity" exists if Chattem can figure out how to switch consumers to the doxylamine-containing OTC sleep aid, Bosworth added. "We haven't found that answer yet, but we're seriously looking for it," he said. The executive touted that Unisom remains "the leading single-ingredient sleep aid product" on the market. During a Chattem earnings call in January, CEO Zan Guerry said Unisom sales rose 13 percent in the firm's fiscal 2008 fourth quarter. "Unisom should have a good, solid year in 2009," Guerry added. However, Chattem said Unisom sales through mass merchandisers were up just 3 percent for the 52 weeks ending May 16, and decreased 3 percent in the final four weeks of that period. Chattem closed its purchase of three of its big six brands from J&J - Cortizone-10 anti-itch products, ACT mouthwash and Unisom - in 2007 (1 (Also see "Chattem Hopes Brands Acquired From J&J Offset Cool Sales Of Pro-Therapy" - Pink Sheet, 19 Feb, 2007.), p. 10). The six, also including Gold Bond , Icy Hot and Selsun Blue , comprise about 74 percent of Chattem sales. Bosworth said with lower costs for TV advertising recently allowed the Chattanooga, Tenn.-based company to support its core lines with a flurry of quick, succinct spots. Chattem also successfully is shifting sales to mass merchandisers, dollar stores and club stores. Wal-Mart sales account for close to 35 percent of the firm's business, Bosworth said. ACT sales are up 38 percent in the four weeks ending May 16, which Bosworth attributed to the recent launch of ACT Total Care (2 (Also see "Chattem Relies On Line Extensions To Turn Icy Sales Hot" - Pink Sheet, 13 Apr, 2009.), p. 14). He added that the brand recently passed Scope to become the No. 3 mouthwash, behind Listerine and Crest Pro Health . - Dan Schiff ([email protected]) |