Natural Supplement Industry

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Natural Supplement Industry

While the nutraceutical industry faces regulatory challenges, the recent COVID-19 outbreak is increasing the interest of these products. Nutraceutical companies like Youtheory and Moon Juice have reported seeing a substantial spike in sales since the outbreak intensified in March.

NUTRACEUTICAL INDUSTRY: OPPORTUNITIES

Demand for Functional Foods

  • The demand for functional foods and beverages in the US and globally has spiked substantially over the past few years and continues to increase due to the high cost of medical treatment.
  • Based on a study by Pew Research, almost 50% of US consumers are interested in nutrition and vitamins and go online to look for information about them.
  • Additionally, more consumers are turning to vitamins and supplements for health benefits like heart health, cancer prevention, better immunity, increased brain power, joint health, and stress relief.
  • These consumers believe vitamins and supplements are better positioned to offer these health benefits than food, beverages, or beauty products.
  • Amid the COVID-19 pandemic, the nutraceuticals industry is seeing a higher demand than ever before. Since the beginning of March 2020, weekly sales of vitamins, minerals, and supplements have grown by up to 140%.
  • The demand for nutraceuticals is expected to continue to grow as more customers turn to these products for a stronger immune system and a better chance of avoiding diseases.

Increased Interest in Health & Fitness

  • There is a rapid increasing interest in personal health and wellness by more and more consumers in countries like the US, as well as a "proliferation in digital content around the topic of health and wellness as a simple Google search for “health and wellness” yields over 500 million results, with a search volume of over 12,000 per month in the United States."
  • There is also an increased interest in plant-based diets in the US. A study by Food Insight showed that 23% of US consumers actively seek out foods for the health benefits they provide, with the most sought after health benefits being weight management, digestive health, cardiovascular health, and muscle strength.
  • In reference to what they perceive healthy in foods, fiber, whole grains, protein from plant sources, and probiotics were the most cited ingredients among US consumers.
  • Based on the study, almost 35% of US consumers consume plant-based protein daily, while about 50% of consumers who do not know about plant based diets are interested in it.
  • In addition, 38% of US consumers follow diets like clean eating, gluten-free, low-carb, vegan, and keto.
  • Since most nutraceutical companies claim to use plant-based ingredients alone, this is an opportunity they can leverage.

CHALLENGES

Ill-Suited Regulatory Environment

  • The regulatory status of nutraceutical products has a significant impact on its success. A solid regulatory framework is necessary for medical credibility, as it "ensures high-quality products that can be relied on to do what they say they do."
  • Several products are being recalled in the nutraceutical industry due to the use of unapproved drug ingredients in categories such as weight management and body building. In the same vein, there hasn't been enough focus on developing a regulatory environment for this industry that can foster innovation.
  • Currently, each key market for pharmaceuticals has its own approach to regulation. In the US, the FDA considers nutraceuticals to be vitamins and dietary supplements, paying attention to patient safety.
  • China, on the other hand, has different processes to register and import functional foods. This makes its overall regulatory climate difficult for new entrants.
  • In Latin American countries, there is no consistency in the classification or approach of nutraceuticals. Some Latin American countries regulate them as foods, while others regulate them as drugs. Brazil's "bureaucratic approach to registration of health claims could emerge as a standard."
  • Europe is the best-developed market for regulation as the European Food Safety Authority (EFSA) has developed a positive "list of permitted health claims based on individual ingredients," thus enabling countries in the region to establish a positive reputation for quality. It is the best environment for innovation as well, however, the European regulatory environment is behind on technology.
  • Due to the regulatory barriers in these countries and regions, the growth of the nutraceuticals sector remains limited. A positive regulatory environment is required for rapid growth.

Misunderstanding the Role of Nutrition

  • While the nutraceutical industry is growing at a modest rate, it has more potential. A key barrier to rapid growth in the market is "consumers' and health professionals' poor understanding of nutrition's impact on health."
  • A lot of consumers who could benefit from nutraceutical products are not willing to change the lifestyles to become healthier. While using most nutraceuticals, it is important to combine them with broader behavioral changes for results. For example, some nutraceutical products can help slow down the progression of dementia, but for these products to offer maximum results, they need to be combined with brain training and lifestyle changes like exercise and social interaction.
  • This results in a "situation where supplements tend to be bought by people who generally do not need them, but not by those at serious risk of chronic disease who might actually benefit."
  • Additionally, many health professionals are not well-versed in nutrition and how it can help manage diseases. All through their careers, doctors might only get a few hours of training on the role of nutrition and are often skeptics when it comes to the effectiveness of alternatives to pharmaceuticals.
  • This is even more accurate among health care professionals who take care of seniors. To make matters worse, the "evidence base is relatively weak, as the nutraceutical industry has been slow to recognize the importance of fact-based claims and struggles to fund the large-scale clinical trials typical of the pharmaceutical industry."
  • Although nutraceuticals are generally far "less expensive than innovative medicines, they are difficult to justify compared to generic drugs that often cost less than $1 per day and can provide effective control for many conditions."

MUD\WTR

  • MUD\WTR describes its brand as a coffee alternative comprising organic ingredients "lauded by cultures old and young for their health and performance benefits."
  • Its main product is a starter kit for new customers, which includes every thing they need to get started: a 30-serving tin of mud, a USB rechargeable frother, and a guidebook. The kit costs $60 for a one-time purchase.
  • MUD\WTR also sells a 30-serving creamer tin - which it claims is plant-based, gluten-free, and vegan - for $25; a 90-serving bag of its adaptogenic coffee alternative for $125; a 90-serving creamer bag for $50; and a whip - used for mixing the coffee alternative - for $15.
  • In addition, it sells branded apparel - hats, beanies, hoodies, and jackets - and mugs with terms like "Chai Believe" and "F*ck Coffee."

Marketing

  • MUD\WTR leverages PPC (pay-per-click) ads to "buy" visits to its website. In its PPC ad, it mentions that consumers can "get energy & focus without the jitters." It also claims that its product is packed with adaptogenic mushroom compounds.
  • The brand uses sponsored image ads on Facebook and Instagram as well. In these ads, it describes its brand as something "better" than coffee.
  • It appears MUD\WTR mainly uses micro influencers with less than 50,000 followers. On Instagram, it has worked with Alea Rain, a "movement artist and visual philosopher" with 23,900 followers; Hailey Niswanger; a composer and saxophonist with 17,500 followers; and Racquelle Lawrence, a blogger who promotes "sustainability" and has 47,900 followers.
  • In addition, it has an affiliate program, which it offers a $10 per sale commission for.
  • It is active on Instagram, Facebook, and Pinterest. Across these platforms, it posts several times a week. Most of its posts are pictures and videos of people using or reviewing its staple product - the Mud Masala Chai coffee alternative, others are about inspirational quotes related to spirituality, meditation, and life in general.
  • Currently, MUD\WTR has over 25 active paid ads on Instagram and Facebook. Its most recent ad, released on June 20, 2020, features an artwork with its product and is headlined "MUD\WTR has 1/7th (14mg) of caffeine and leans on adaptogens, ayurvedic herbs and cacao to give you focus, immune, and inflammatory support while letting your body's natural energy production do its thing."

Recent News

  • In a May 2020 article by Mindbodygreen titled "The 5 Well-Being Items From Free People We Can't Stop Using At Home," the MUD\WTR Masala Chai was described as a product that "passes the test" and offers "benefits far beyond a midday pick-me-up."
  • An article published by Entrepreneur on May 22, 2020, titled "The 4 Things This Founder Does Every Day to Improve Productivity" featured the founder of MUD\WTR describing how he improves productivity by meditating, taking a break from technology, and not being reliant on several milligrams of caffeine a day. He mentioned that MUD\WTR did over $1 million in revenue in 2018, when it launched.
  • Seattle Times published an article on April 29, 2020, titled "You can pick your flavor, and you can pick your tea — but you should let an expert pick your mushrooms." MUD\WTR was featured as a mushroom drink that "bills its mixture as an invigorating alternative to morning Joe."
  • An article by Your Tango published on January 22, 2020, featured the MUD\WTR coffee alternative as one of the "20 Best Mushroom Coffees That Boost Immunity And Energy."

MOON JUICE

  • Moon Juice categorizes its products into supplements, skincare, snacks, and merch. The brand has supplements for hair, unstressing, skin elasticity, collagen, focus sex drive alertness, and sleep. It also sells single ingredients powder like ashwagandha, chaga, cordyceps, mucuma, cacao, probiotics, and maca. The price range of these supplements is $30 to $60.
  • Its skincare products include a Milk Cleanser, which costs $32; an Acid Potion (exfoliating toner) for $42; a Plump Jelly (dewy serum) for $58; a Cosmic Cream for $58; and a Collagen powder for $32.
  • Moon Juice also sells dried fruits for $8, crisps in different flavors for $7, nuts & seeds (including flavored walnuts, almonds, and cashews) for $6 to $32, and Gluten-free overnight oats for $20.
  • Its merchandise include a milk frother for $22, a straw set for $12, a tumbler for $26, a thermal tote for $10, and a cookbook for $30.
  • The brand claims its supplements contain potent adaptogenic herbs that improve mood, relaxation, focus, and energy.

Marketing

  • In 2018, Moon Juice wanted to expand its audience and spread its message of plant-based well-being far and wide - outside of Los Angeles. This led to a partnership with an advertising agency called Tinuiti (previously CPC Strategy).
  • Tinuiti helped the brand fully leverage online and social media marketing, including Facebook. The agency helped increase the awareness of Moon Juice through paid Facebook and Instagram ads.
  • In the first quarter of 2018 - after working with Tinuiti - Moon Juice's conversion rate increased by almost 2%, while its revenue spiked by 21.72% year-over-year.
  • Its paid social media efforts included pictures of its beauty dust, brain dust, and sex dust powder, as well as, their benefits. For example, its power dust was described as a product that boosts energy and helps "feed the physical." Its brain dust was advertised as a product that can "invigorate and stimulate the mind."
  • In general, Moon Juice mentions that Instagram is the heart of its social growth. There, its content is "cosmic, colorful, and almost otherworldly."
  • Moon Juice currently has more than 35 paid ads on Facebook and Instagram. Each ad highlights a different product. In a recent paid Facebook and Instagram ad released on June 16 about its SuperBeauty capsules, it mentions that this product is "cellular skincare for collagen, elasticity, & cell longevity. Bioactive. Bioavailable. Vegan." It also boldly outlines its Free Shipping offer on orders above $50.
  • Amid the COVID-19 pandemic, Moon Juice is advertising a lot of its products that help with stress. It recently "advertised its Super You multi-vitamin product, in addition to its skin-care products and adaptogen and magnesium sleep powders with messages and taglines like Don’t let stress, stress you out — or weaken your immunity" and “Foster a healthy immune system by managing stress…”"
  • The company also leverages PPC ads on Google and email marketing.
  • Moon Juice does not work with influencers and considers influencer marketing an "inflated game." However, several celebrities, including Zoe Kravitz and Gwyneth Paltrow, swear by the brand and mention the brand in interviews and on social media.

Recent News

  • On June 12, 2020, Glossy published an article titled "The pandemic has pushed beauty sleep to the center of wellness." Moon Juice was mentioned as a company that has reported "significant interest in its sleep products with its Dream Dust and Magnesi-Om sales increasing by 70% and 50%, respectively, between mid-March and May 2020."
  • Forbes published an article on June 16, 2020, titled "Six Of The Latest Must-Have Clean Beauty Drops." The Moon Juice Acid Potion was described as a "nourishing exfoliator that resurfaces the skin with five acids and botanical support that minimizes fine lines and pores."
  • An article by InStyle published on May 28, 2020, titled "Mushrooms Are The New Must-Try Ingredient For Sensitive Skin," mentions that the Moon Juice Shroom Plump Jelly is a "mega-powerful moisturizing mix of silver ear mushroom (the super-shroom that can hold up to 500 times its weight in water), and hydrating hyaluronic acid."

WYLDE ONE

  • Wylde One claims it develops high-performance elixirs and functional latte blends created with "high quality adaptogens, medicinal mushrooms, nootropics (aka brain boosters), and superfoods."
  • Its products are reportedly developed to help optimize and transform well-being.
  • Its products include a matcha, cacao, and turmeric latte for $29 each and elixirs for different purposes like mental clarity, gut health, and stress relief at $35 each.

Marketing

  • Currently, Wylde One runs one sponsored ad on Facebook. The ad has been running since December 2018. It includes pictures of its bestselling elixirs and a review of what customers are saying about its products.
  • For example, it describes its Brain Buzz Adaptogenic Elixir as the "ultimate brain fuel for focus and clarity."
  • The brand runs a Google PPC ad as well to buy more website visits. In the ad, it encourages consumers to use the code "WELCOME" for 10% off.
  • Wylde One has made no mention of influencer marketing. It does not feature influencers on its social media pages as well.

Recent News

  • An article published in May 2020 titled "Forget CBD. Mushrooms Are the Beauty and Wellness Superfood You Need Right Now," mentions that at "Two Hands in New York’s Tribeca, a drink containing a reishi mushroom powder by Wylde One is listed right alongside turmeric lattes and matcha teas."
  • A September 2019 piece by Vogue titled "From Seinfeld to Chaka Khan, this Celebrity Stylist Revels in Eclectic Inspirations," mentions that a mushroom powder from Wylde One is a must have for Jasmine Benjamin, a celebrity stylist.
  • In an article by Fashion Week Daily titled "As If you Needed Another Reason to Stay at Surf Lodge," it was revealed that Surf Lodge now offers a complimentary beauty mini bar in all its rooms. A Custom Adaptogenic Elixirs by Wylde One is included in this mini bar.

YouTheory

  • Youtheory categorizes its products into Beauty, General Wellness, Digestive Health, Joint Support, Emotional Wellness, and Mens Health.
  • Its Beauty products include collagen powder & liquid, resveratol, and slimming citrus fruit capsules. The price range of these products is $20 to $24.
  • The brand's General Wellness products include turmeric, immune support, and energy boost supplements. They cost between $17 to $33.
  • Youtheory's Digestive Health products include probiotic capsules for and a probiotic powder for $28 each.
  • Its Joint Support products include hyaluronic acid and joint collagen, which cost $29 each.
  • Its Emotional Wellness products include maca root, ashwagandha, magnesium, and saffron at $19 to $36 each.
  • The brand's Mens Health products include mens collagen, joint complex, maca, and shilajit at $16 to $29 each.
  • Youtheory claims it is "one of the original collagen supplement brands" built on the utmost "integrity, authenticity, and quality."

Marketing

  • One of Youtheory's main marketing strategy is partnerships. In 2017, the brand was named the "official health supplement of Auto Club Speedway for the second straight year during the Monster Energy NASCAR Cup Series Auto Club 400 race weekend scheduled March 24-26, 2017."
  • The brand mentioned that NASCAR has been a good marketing partner for more than three years. The partnership included an activation for Youtheory at these events to increase awareness about its product line.
  • It also partnered with the Los Angeles during the 2018 Major League Baseball season. The partnership consisted of an outfield wall sign at the stadium, a presence at the team's training games, and a spot for people to sample its products.
  • Youtheory does print, digital, and social media marketing as well. It recently sought the help of Melissa Matos Design for magazine ads, social media content - leading to a 30% average engagement, animated GIFs for Instagram Stories, and digital banner ads.
  • Its digital banner ads mainly feature active women wither running or stretching with taglines like "look good - feel good," "refuse to let your skin act its age: theory of a beautiful life," and "keep calm - find balance."
  • Youtheory does Google PPC advertising, in addition to influencer marketing. It has worked with Ashley Marah, a nutrition specialist and influencer with almost 52,000 Instagram followers; Tatiana Weston Webb, a surfer with 467,000 Instagram followers; and Griffin Colapinto, a surfer with 198,000 Instagram followers.

Recent News

  • An article published on April 13, 2020, titled "Coronavirus causes 'huge spike' in immunity supplement sales," revealed that Youtheory has seen a 76% spike in supplement sales, led by "standby collagen “for healthy skin” and turmeric “for system health, overall health.”"
  • Yahoo Finance released an article on March 31, 2020, titled "Youtheory Announces New USP Certification For Turmeric Supplement." It mentioned that Youtheory announced the USP certification of its Turmeric Extra Strength.
  • In an article published in November 2019, titled "Youtheory Health Supplement Brand Partners With Toronto Maple Leafs For 2019-2020 Hockey Season," it was mentioned that Youtheory is now the preferred Collagen and Turmeric partners for the Toronto Maple Leafs.

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