dm-med’s OTC Strategy, Brand Extension and Brand Risk

Yesterday Apotheke Adhoc reported that dm-med, dm’s entry into the online pharmacy market, is not yet disrupting other online pharmacies (translated):

In terms of product range, dm-med remains significantly more limited compared to traditional mail-order pharmacies. According to an analysis, the drugstore chain's subsidiary offered 2,763 items in calendar week 18. In contrast, the average for established online pharmacies during the same period was more than 45,000 items

The company has so far clearly focused on selectivity rather than product breadth. According to DatamedIQ, almost 70 percent of its offerings are concentrated in just three areas: dermatologicals, the nutrient and metabolic systems, and the respiratory system. Other product categories, such as medical devices, veterinary medicines, or homeopathic remedies, currently play a significantly smaller role.

The same day, dm’s CEO, Christoph Werner, shared his satisfaction with how well the business is doing, from Lebensmittel Zeitung (translated):

Mr. Werner, you launched dm-med at the start of the year. How is the pharmacy business going so far?

Very well and exceeding our expectations.

A bit more specific information would be nice.

I'm cautious with figures. We planned rather conservatively, partly because the project was technically very demanding and we wanted to ensure a smooth launch first. We've achieved that. Now we'll be communicating the offering more effectively

Signs on the shelves in your stores point to your dm-med range. That's quite aggressive.

Right, we've recently increased our visibility. But we're in no hurry. It's a market that's moving towards us. Generally speaking, I can say that our approach of demonstrating our expertise in health-related products is resonating. Around two-thirds of our online shopping carts are already mixed, meaning they contain products from our over-the-counter pharmacy and drugstore ranges.

dm, which is the leading drug store chain in Germany by both market share and revenue, launched dm-med in December 2025 by focusing on over-the-counter (OTC) medication. Jumping on the same train, Rossmann, a close second, announced a few weeks ago the launch of their own service at the end of the year, but with a focus on prescription drugs.

It’s interesting to see how different those strategies are from one another. By starting with OTC, dm is going for the low-hanging fruit, not just when it comes to operations and drug regulations, but also when it comes to customer behaviour. If you have a chronic condition or one that is seasonal or recurring such as an allergy or your period (indeed, 50% of all people are women), then you typically have a go-to product already. So the question isn’t what to buy, it’s where to buy it from and when. This is an easy game to play - all you have to do is give the customer what they came for, and dm already knows how to do that well. Serving patients in a need of a prescription drug is a much more complicated scenario and high-stakes, where talking with a professional about dosing, side effects or combination with other drugs and products is beyond nice-to-have.

Then there is brand risk and ensuring you maintain the trust of your customers as you introduce new experiences for them. Purchasing medication over-the-counter is inherently consumer-led and thus low-expectations. Contrast this with prescriptions, where a consultation with a professional matters a great deal. By focusing on OTC, dm protects their brand even as they extend it towards this new experience. It’s not a big leap of trust to buy my OTC pain killers from dm if I already buy my food and vitamins from there. If I do this few times in a roll, it becomes my new default for that item. Step-by-step, I can add more medications to my basket, further solidifying my relationship and trust with the company. And if I trust them with my chronic pain medications it’s not a big leap of faith to trust them for medications in general, prescribed or not. Rossmann, on the other hand, signed up to win a considerably harder game, with a lot more skin in the game and exposure to its brand name.