A Shot in the Arm

It is a peppy period for the vitamins and supplements sector. With consumers from a wide range of demographic groups pursuing health and wellness, and manufacturers rolling out new and diverse products, category sales are rising.

“The demand for vitamins and dietary supplements remains positive in the U.S.,” notes Ayako Homma, research analyst with Euromonitor International Inc., a Chicago-based market research firm. “Due to improved economic conditions and rising household wealth, consumers are willing to spend on the items in addition to their regular foods to maintain their health.”

Other factors driving sales include an aging population and the greater accessibility of products through various distribution channels, she notes.

“Older consumers consume vitamins and dietary supplements to reduce their risk of chronic diseases and illness, to delay the aging process, and safeguard their health,” Homma states. “Young millennials also are open to nutritional supplements and alternative health care as they are educated on the benefits of vitamins and dietary supplements, and were raised by health-conscious baby boomers.”

Adding further vigor to the sector is the launch of products in new forms. In addition to traditional pills, for instance, consumers will find gummies and other chewable tablets, capsules, liquids and powders.

“Persons age 18 to 24 are driving the alternative formats,” says Margie Nanninga, home and personal care analyst for Mintel, a Chicago-based market research firm. “More women also are seeking products that will help improve their appearance. Instead of being reactive, they are following a proactive lifestyle and are interested in taking supplements that could enhance such features as their skin, nails and hair.”

One size does not fit all

More shoppers, meanwhile, are seeking specific types of vitamins such as vitamin A, C or D in lieu of multivitamins.

“Consumers are starting to feel that the one-size-fits-all approach may not be as relevant as a single vitamin that addresses certain concerns,” Nanninga notes. “Multivitamins are still number one in the category, but the gap is closing”.

Sellers of store brands could help combat any skepticism on consumers’ part by highlighting product effectiveness, Nanninga notes. Methods include spotlighting ingredients and claims on packaging and in-store displays, and correlating messages with specific shopper interests.

Instead of just saying multivitamin,’ for instance, the package could say ‘beauty vitamin’ or a ‘vitamin for hearing health,’” she notes.

Marketing for letter vitamins is less critical, suggests Marty Friedman, national sales director for Geri-Care Pharmaceuticals, a New York-based manufacturer of vitamins and supplements. The products “don’t need a brand,” he states. “The letters sell themselves.”

Gummies, a major driver of category revenues, remain particularly popular because they are pleasant-tasting, available in a variety of flavors, more fun for children to consume and easier to swallow than tablets, analysts and suppliers note.

Probiotics sales also are healthy, primarily because of media reports publicizing the health benefits of the supplement, Friedman states, adding that shelf space for probiotics has grown substantially over the last two years.

Innovation is important

Retailers, nevertheless, will be in position to spur sales of all store brand vitamins and supplements by offering innovative products instead of just national brand equivalents, states Stephen Rosenman, vice president of corporate marketing and strategy for International Vitamin Corp. (IVC), a Freehold, N.J.-based vitamins and supplements supplier.

“If a store brand multivitamin has the same ingredients as the national brand but uses, for instance, natural colors, publicizing that on the package would generate incremental pickup,” he states. “Retailers should not be afraid to make little changes that can have a big influence.”

Other messaging could note such potential differentiators as an item being gluten-free or that a product’s ingredients are plant-based.

“Retailers should proactively seek out additional claims or benefits that have value to consumers based on trends,” Rosenman says.

Unlike in many other private label categories, cost alone is not the primary attraction for many private label vitamin and supplement shoppers, he adds.

“National brands spend a lot of money driving traffic to stores, but once shoppers are in the vitamin aisles, they will switch products a lot more frequently than in other sectors,” he states. “They will look at an item next to the one that is advertised, and if it has incremental benefits and is priced right, they will try it. They are not brand loyal.”

Such benefits can include being natural and free from artificial colors and sweeteners.

“All-natural is typically associated with the food category, but it is quickly going over to supplements,” Rosenman states.

Sugar also is a concern. While gummy revenues still are increasing, Rosenman forecasts a leveling off because of sugar in the items and the launch of attractive alternatives. IVC, he notes, is producing powders that taste like | candy, are low in sugar and do not require water to swallow — as well as a tablet that dissolves on the tongue.

Looking ahead

To further grow private label activity, Rosenman notes that retailers “need to think more like national brands and give the products the proper amount of store space, attention and promotion.”

To optimize sales, marketers also must overcome negative research that has been publicized in the media in recent years that questions the value of consumers using vitamins and dietary supplements instead of just eating more healthfully.

Mintel, nevertheless, projects sustained growth for vitamins and dietary supplements.

“Creating products that meet consumer needs and address their health concerns can help to further increase usage, especially among the younger population who is less likely to use,” notes Emily Krol, Mintel health and wellness analyst.

Do spotlight supplement ingredients and claims on packaging and in-store displays.

Don’t forget to call out product positives such as an all-natural status.

Do think like the national brands when it comes to shelf space, marketing and promotion.

Don’t ignore consumers’ needs; offer new product formats that mesh with their routines.