CareCredit - Women's Health April 2024

Consumers on Weight Loss Drugs Expected to Spend Double on New Clothes After Losses

The rising popularity of certain weight loss drugs might end up helping apparel makers.

That’s according to a recent survey by investment banking firm Stifel, the subject of a Saturday (Dec. 2) report from Seeking Alpha. 

That survey found that 15% of respondents are on GLP-1 medications such as Mounjaro, Wegovy and Ozempic. Another 21% said they’d be interested in taking these drugs if they were approved by the FDA and shown to be effective.

Per the report, Stifel’s Jim Duffy mentioned several retailers who could benefit from expanded use of GLP-1 drugs, including LululemonLevi’s and Dick’s Sporting Goods, as people who stick with a weight loss drug and lose a great deal of weight would double their clothing spending.

He also said other industries could benefit as well, such as energy drink makers and lifestyle nutrition brands.

The survey comes weeks after reports that the rise of Ozempic and other drugs was leading to a reduction in grocery sales for some retailers.

For example, Walmart said in October that customers who purchase appetite-suppressing medications such as Ozempic are buying less food.

The retailer is analyzing anonymized data on shopper populations to gain insights into changes in sales patterns among individuals who are taking the drug compared to those who are not, 

“We definitely do see a slight change compared to the total population, we do see a slight pullback in overall basket,” Walmart U.S. CEO John Furner told Bloomberg News.

Walmart sells GLP-1 drugs, like Ozempic, through its pharmacies, and the company has seen a substantial increase in revenue from those sales. Since 2020, sales of such medications have tripled across the industry.

In June, Rite Aid said that the demand for Ozempic and other GLP-1 medications for managing Type 2 diabetes and addressing obesity had boosted pharmacy sales 3.4% year over year.

Also in October, Johnson & Johnson (J&J) reported a decline in sales of devices used for abdominal surgeries. The company attributed this drop to a slowdown in procedures such as bariatric surgery, as many patients have opted instead to try weight-loss medications.

“These medications may ultimately lead patients toward other procedures involving J&J products,” PYMNTS wrote at the time. “Individuals who are obese and initially ineligible for orthopedic procedures, hip and knee replacements, or specific cardiovascular interventions, could potentially be suitable for these treatments later on.”