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Nearly a year and half after its heralded debut, the market potency of Procter & Gamble Co.'s Aleve pain reliever is coming into question.

Sales topped $100 million in Aleve's first year, but so did marketing expenditures. And what P&G has bought for its efforts is a market share that, while respectable, isn't growing significantly.

"They've done an excellent job of introducing the product, but it hasn't met expectations in category growth," said Don Stuart, a partner with Wilton, Conn.-based consultancy Cannondale Associates.

Aleve was the fourth-ranked pain reliever, with a 5.4% share on sales of $143.3 million, for the 52 weeks ended Aug. 27 by food, drug and mass merchandisers, according to Information Resources Inc.

But that represented the loss of more than a share point from Aleve's high-water mark. Largely on the strength of its distribution, Aleve grabbed the third spot among analgesics just weeks after hitting shelves in June 1994, and it had a 6.5% monthly share by that August.

Aleve sank to a low of 4.5% last February due to production and supply problems, a P&G spokesman said. But the brand bounced back to a 6.1% share in April after a campaign launched in March from D'Arcy Masius Benton & Bowles, New York.

"They reinvigorated their market share, but they've only held, not grown," said William Steele, an analyst at Dean Witter Reynolds, San Francisco.

Paul Kelly, president of Silvermine Consulting, Westport, Conn., said: "It seems that if they do aggressive promotion, they see a boost. But whether the customer is staying with them is the question."

About $72 million was spent in the first year on Aleve advertising, according to Competitive Media Reporting, and P&G is said to be maintaining that level.

"Most brands spend equal to or in excess of sales in the first year, so our sales-to-spending ratio isn't inconsistent with other new brands," the P&G spokesman said. He declined to share data on repeat business, but said the company is "pleased" with the results.

The $2.7 billion analgesics category was basically flat for the year ended Aug. 27, with a sales increase of just 1.5%. However, P&G pointed out that the growth rate at the end of its fiscal year June 30 was 5%-twice the category's traditional growth rate of between 2% and 3%. Such growth from new pharmaceutical products usually comes early, from patients who switch to over-the-counter from prescription medicines.

"Grocery stores haven't benefited as much as they expected" from Aleve, Mr. Stuart said. "They continue to have less and less share of OTC introductions. Drug and mass appear to be gaining more from new OTCs."

P&G appears satisfied with Aleve's performance. "We did expect some [category] growth, but nothing dramatic. We're very pleased with the first-year results," said the company spokesman. "We are expecting another great year this year, and have some things lined up to make that happen."

Nonetheless, the brand appears far from being on solid ground. Its naproxen sodium patent (Aleve's major ingredient) expires in January 1997; additional category fragmentation is coming soon from newcomer ketoprofen (just approved for OTC by the Food & Drug Administration), and existing brands provide continued heavy competition.

"If they have a 5 share without private label [offering a naproxen sodium analgesic], they'll probably have a 3 share with private label. And if that's where it's at then, it would be a failure," Mr. Kelly said.

Jay Freedman, an analyst with Lincoln Capital Management, Chicago, noted: "They've said they have a next-generation plan [for Aleve] ready for when private label comes along."

Some observers say that P&G, known for its category domination philosophy, won't be satisfied with where Aleve sits now. They add that the company will work hard to make a brand a market leader, but it won't stay in a category forever as a minor player. For example, a few years ago, things went sour for its Citrus Hill orange juice, which never garnered more than about a 10% share. P&G dumped the brand in 1992 after repeated restaging attempts over 10 years.

"The problem is they've gotten too finite in the differences between Aleve, Tylenol and the others. It's a saturated category, and Procter got too micro on this," said Chris Hoyt, president of Hoyt & Co., a Stamford, Conn. consultancy.

So far, most industry observers believe P&G will continue to support Aleve. "They're not going to abandon Aleve-it does have some pretty good brand recognition," Mr. Steele said. "They'll want to use it as part of their portfolio of healthcare brands."

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