Ingredients for Success
Few markets are as dynamic and changing as the one for sports, energy and nutrition products, with new products frequently being introduced. Times have been especially good for the industry over the past several years — thanks, in part, to the recession’s spurring consumers to invest in self-treatment and prevention instead of costly doctor visits and prescriptions. And the supplement side of this market, in particular, is booming.
Promote clean labels, safety
According to “Nutritional Supplements in the U.S., 5th Edition,” a September 2012 report from the Packaged Facts division of Rockville, Md.-headquartered MarketResearch.com, supplement sales climbed to $11.5 billion in 2012 and are expected reach $15.5 billion by 2017. But the report also notes that as household incomes rise, marketers are going to have to step up their game.
One key way of doing that is by focusing on clean labels and consumer safety. More than ever, shoppers want effective supplements that don’t require any guessing as to what is in them.
“Current trends and consumer awareness are being heavily impacted by the performance-enhancing drug scandals, and that has trickled down to the sports supplement arena,” says Kenn Israel, vice president of marketing at Santa Ana, Calif.-based Robinson Pharma, adding that the Vitamin Shoppe and Twin Labs already have “made noises in the industry” with store brand product lines that address consumer safety concerns. Those products are labeled as being free from artificial colors, flavors and sweeteners and also as being “NSF Certified for Sport.”
Other retailers might want to consider following suit with their own products. The certification process, instituted by Ann Arbor, Mich.-based NSF International, involves on-site inspections of the manufacturing facility, as well as regular product testing, but certification is an easy way to let consumers know that the supplement has undergone rigorous testing and is completely free from all banned substances or steroids.
Rethink caffeine
In addition to unsafe and artificial ingredients, retailers might want to think twice about caffeine on the energy side of sports, energy and nutrition products.
“When it comes to the proliferation of high-caffeine products, that’s a trend that may have overplayed its hand,” Israel says.
Brianne Vaskovardzic, director of marketing at Norcross, Ga.-based Private Label Nutraceuticals, which manufactures a variety of private label vitamin and dietary supplements, agrees.
“We have also seen a move away from traditional caffeine-centered energy products in favor of more unique formulations featuring stimulant-free energy support,” she notes, adding that while caffeine remains a “dominant player” in the industry, ingredients such as D-ribose, glucuronolactone, quercetin and taurine are safer choices and “growing in popularity as effective ingredients within the energy category.”
For retailers that still want store brand caffeine-containing products on the shelf — particularly energy drinks — microencapsulated caffeine, which provides a sustained release without any bitterness, is one alternative worth considering.
Pack it with protein
Although retailers might want to exclude certain undesirable ingredients from new product development within the sports, energy and nutrition products segment, they will want to include today’s on-trend ingredients whenever possible. And these days, protein is among the hottest ingredients in the segment.
“Protein is red hot in the industry right now, and its red hot worldwide, especially whey-based proteins,” Israel says.
Whey derived from milk, long has been the industry’s golden child because of its effectiveness at muscle repair and rebuilding, but according to Vaskovardzic, until fairly recently whey really was marketed to only the super athletic.
“We are now seeing private label whey products targeted by gender, age and other defining audience characteristics,” she says, adding that Private Label Nutraceuticals has made its own new line of advanced whey proteins featuring the latest in protein technologies available for private labeling.
Besides whey, several types of isolated proteins are of interest, including soy, brown rice, pea, fish and hemp. Moreover, because the price of whey is expected to keep climbing as a result of high global demand and limited availability some of these proteins could become a lot more popular.
The market already is seeing an increase in the use of vegetable proteins, according to Denmark-based CIL North, an international consulting agency for the global food and ingredient industry, and could see an uptick in the usage of plant proteins as well. Brown rice, in particular, might be one protein for retailers to consider adding to their store brand product lineups; a new double-blind study published recently in the Nutrition Journal, authored by Dr. Ralf Jaeger at Milwaukee-based Increnovo and Dr. Jacob Wilson at the University of Tampa, suggests that brown rice actually has all the same muscle-building benefits of whey for athletes.
“Whey now shares the sports nutrition trophy with rice protein,” said David Janow, president at Los Angeles-based Axiom Foods, in response to the study, which was conducted using his companys Oryzatein Brown Rice Protein powder.
In addition to protein-containing formulations, condition-specific supplements have strong growth potential, since the health benefits they claim to provide are usually backed up by science.
“They will remain a key driver of sales and new product development across myriad segments, including joint, brain, cosmetic and heart, with many of these products homing in on age-related health issues,” notes the Packaged Facts report. The report also states that with “market regulation and scrutiny at an all-time high, it’s more important than ever for the industry to produce and feature products able to substantiate their health benefit claims.”
Know your buyer
To realize success with store brand supplements and other sports, energy and nutritional products, though, retailers need to understand the buyers of such products. According to Packaged Facts, the main consumer demographic for supplements is, not surprisingly, the 65-and-up age group, which is growing in leaps and bounds as the baby boomers age. But for sports supplements, the demographic is a lot broader. While it used to be mainly the hardcore athletes and bodybuilders, today it is a mix of consumers, from endurance athletes and weekend warriors to mainstream consumers just wanting to buy products they perceive as contributing to a healthier lifestyle.
Hardcore athletes, many of them willing to spend top dollar on supplements, are unlikely to ever be the main buyers of the private label alternatives; however, retailers potentially could find success by reaching out to the consumers just interested in being healthy.
“Offering sports nutrition products that target ‘recreational athletes’ or that support overall wellness often fill gaps in store brands to offer increased sales, profits and brand loyalty,” Vaskovardzic says.
Marketing protein formulations as an easy way to add protein to a smoothie or yogurt for general health purposes, rather than specifically as a product for post-workout recovery, is a strategy that could work. And for seniors, retailers could promote proteins as especially beneficial for preserving the muscle mass that is lost with aging.
Whoever the intended buyer, the messaging on the bottle needs to be honest about what the consumer realistically can expect when using the product, if retailers want the customer to buy it again.
“You don’t want to overpromise and underdeliver,” Israel says.
It also really does matter where retailers source their supplements.
“It is crucial for retailers to work with an experienced and knowledgeable manufacturer — not only to ensure a high-quality product, but also… to ensure product and labeling compliancy,” Vaskovardzic says.
She adds that unique product formats such as convenient, portable shots and fortified nutrition bars are becoming increasingly important for both the energy and sports nutrition markets.