Nutritional Supplements Market Research Report

Client: Packaged Facts, one of the top publishers in the United States of market studies on consumer products.

Challenge: Packaged Facts needed a revamped edition of its 200-page report on nutritional supplements to reach an audience of investment bankers, industry leaders, and brand marketers.

Result: Cap & Wing pored over primary and secondary research to create an in-depth report that covered a bird’s-eye view of the nutritional supplements market; topics included market size and projected growth, product trends, marketing strategies, and competitor insights.

Packaged Facts

Excerpt:

Consumer Advertising Themes and Promotions

Television advertising for nutritional supplements is relegated to well-known, nationally distributed, mass-market brands like One-A-Day (Bayer) and Centrum (Wyeth), whose pharmaceutical parents are among the most sophisticated consumer product marketers in the world. Smaller marketers advertise in lifestyle magazines and newspaper supplements, often accompanying their product pitches with money-off coupons. In addition, the Internet has become a primary means of targeting consumers for companies both large and small, offering an inexpensive, easy way to reach millions of consumers.

Women—the primary shoppers in most households—are the target of most consumer ads, including those for kids. A partial exception is for men’s products, although most of these ads are designed to appeal as much to the women in men’s lives as they are to the prospective users. Marketers also call upon a well-stocked arsenal of promotional devices, including couponing, free-standing inserts, trial and bonus sizes and sweepstakes. All of these techniques are used most heavily in the mass-market sector, which is populated by larger companies with deeper promotional pockets.

The following themes run through consumer advertising for nutritional supplements:

  • Health/Wellness Benefits: The ultimate aim of taking supplements is naturally the health benefits they claim to provide, ranging from the general (“Balanced and Complete. From A to Zinc,” proclaims Centrum’s well-known multivitamins catch-phrase) to the condition-specific (“Fights Osteoporosis,” promises Citracal promotional copy).
  • Legitimacy: Marketers of nutritional supplements often seek to reassure consumers that their products are top quality. For example, on its website Bausch & Lomb promises consumers that its supplement lines “are manufactured in accordance with the rigorous standards that apply to pharmaceutical products, using only the highest quality ingredients.”
  • Demographic Targeting: Targeting seniors, NBTY’s Osteo Bi-Flex pictures a smiling older couple on its website, above a caption advertising the product’s sponsorship of the Arthritis Foundation, an alliance that lends legitimacy to the product. For the many products designed for women, marketing materials tend to rely on soft lines and pastel hues, while kids’ supplements go for the trappings of children’s marketing, such as cartoon characters and vivid colors.
  • Coupons and Savings: Online promotions have proven to be a convenient way for marketers to make and promote money-saving offers. From the respective brand websites, Centrum offers a dozen or so coupons for $1 to $3 off; Nature Made offers users “Wellness Rewards” coupons in exchange for the dollars they spend; NBTY’s Puritan’s Pride promotes “buy 2, get 3 free” sales; and Coromega offers a $5 printable coupon for a 30-count box of its Omega 3 supplements

Eco-Credibility

Since nutritional supplements fold neatly into the phenomenon some marketers call LOHAS, or Lifestyles of Health and Sustainability, many of them attempt to link their companies and products to environmental themes. The word “nature” and its variations figure into so many product brand names that it practically goes unremarked, with packages that include trees, mountains, or other natural imagery. A product might also declare itself to be “eco-friendly,” often for no discernable reason. In actuality, most nutritional supplements are still sold in environmentally unfriendly plastic containers, although some marketers might claim they have developed packaging that generates less waste. But beyond packaging, not much really can be done to raise a supplement’s environmental friendliness. The website of The Vitamin Shoppe contains an “Eco-Shoppe,” but this sub-store’s inventory focuses on décor, bags and cleaning products instead of nutritional supplements.

The production of omega-3 supplements is one area where environmental issues are growing in importance. Omega-3 is a nutrient of fish oil, and the same consumers who look to buy sustainable seafood for their diets are expecting their omega-3 to be derived from sustainable sources. Accordingly, Norwegian omega-3 manufacturer EPAX has launched an “EcoVision” website to highlight the sustainable and traceable qualities of its products.

Meanwhile, krill oil, a source of omega-3 fatty acids that comes from krill (a type of small crustacean), became a flashpoint in the nutritional supplements industry when Whole Foods declared in May 2010 that it would no longer carry it. The company said in a statement: “Krill are an important source of food for marine animals including penguins, seals and whales in the Antarctic. Declines of some predator populations in the areas where the krill fishery operates suggest that fishery management needs to better understand how to evaluate the prey requirements of other marine species in order to set sustainable catch levels for krill. Consequently, at present we are choosing to discontinue the sale of krill supplements as we continue to evaluate this emerging research.” Krill suppliers claimed that Whole Foods’ decision was misguided and based on faulty research.

Traceability

Linked to legitimacy and environmental credibility, many supplement companies are touting the “traceability” of the ingredients used in their products. Canadian company Ascenta Health is featuring on its website and packaging a platform called “PureCheck” which allows consumers to learn specific information about ingredients in any particular bottle of supplements. Likewise, Gaia Herbs established a “Meet Your Herbs” section of its company website that allows consumers and retailers to enter in an ID number from a product’s packaging to learn about the ingredients inside and the dates they were tested for purity. The service is also available through a mobile device application.

Celebrity Endorsements

Celebrity endorsement are a tried-and-true marketing tactic of most retail products, and nutritional supplements are no exception. Athletes are a good fit for the products, in particular for energy drinks and sports supplements. Bicyclist Lance Armstrong and Derek Fisher, a basketball star, are just two of many athletes who endorse FRS Healthy Energy products. Both Kobe Bryant and LeBron James, two more basketball players, endorse the sports drink Vitamin Water. Boxer Evander Holyfield signed up as a pitchman for Gamma Pharmaceuticals, in support of a new line of supplements called Holyfield’s Choice. Meanwhile, reality TV stars Khloe and Kim Kardashian promote for GNC a diet product called QuickTrim. Self-help guru Deepak Chopra lends his name to an online store of personal care and healthcare products, which include a full line of proprietary supplements.

In a country that has created celebrity chefs and celebrity self-help gurus, it’s not surprising that a cadre of celebrity nutritionists and doctors make the rounds, too. Dr. Andrew Weil, recognizable for his bushy white beard, pitches several supplement products under his own name. A pediatrician named Dr. Alan Greene, who shows up as a go-to expert on programs like Good Morning America, launched a line of children’s supplements with supplement maker Twinlab. Andrew Lessman, a telegenic presenter with a background in chemistry, regularly hawks on the Home Shopping Network the nutritional supplements manufactured by his company ProCap Laboratories. Talk radio host Gary Null, whose career is based on his advocacy of complementary and alternative medicines, sells videos, books and, yes, a line of supplements. His supplements made the news in May 2010 when he suffered a near-death experience after consuming his own product, called the Ultimate Power Meal. As a result, Null entered into a lawsuit against the manufacturer Triarco Industries, whom he alleges put excessive amounts of Vitamin D in the product.

Web 2.0

Along with standard marketing tools, most companies have at least a basic website, and Facebook fan pages are becoming de rigueur. Meanwhile, some companies are moving into more advanced types of Web marketing.  A section on Bayer’s One-A-Day website called “My Tree Matters” allows customers (women in particular, judging by the design) to establish goals in various areas of their lives, i.e. health, career and relationships, and to set “actions” to reach those goals, thereby unlocking other parts of the site. A social networking component allows users to share goals and achievements with friends.

Meanwhile, Nature Made has an “Ask an Expert” feature on its website that allows users to e-mail questions about health to a half-dozen features nutritionists or doctors. Presumably, individuals will receive personal responses and certain Q&A’s are posted publicly. In June 2010, Joint Juice launched a section on its website that allows users to assess their joint health profile after answering a series of 15 questions regarding Body Mass Index (BMI), diet, exercise, and other health-related areas.