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Vitamins and supplements are booming in sales in spite of the recession. While some consumers are becoming more proactive about their health by taking vitamins and supplements, others are making purchases in an effort to stay well and save doctor visit or prescription drug expenses in this rough economy. The latest trends in vitamins and supplements include obsession with the letter “D,” liquid softgels for easier swallowing, and a wide range of supplements geared toward specific needs.
Whether it’s omega-3 or flaxseed oil, vitamin D or glucosamine/chondroitin, sales are healthy in the vitamin, mineral and supplement (VMS) category. Overall, supermarket vitamin and supplement sales were up 5 percent over the previous year to $1.5 billion. Sales of nutritional supplements accounted for almost two-thirds of total category sales, just missing the billion-dollar mark and soaring 6 percent over the previous year (sales for year ending March 21, 2009, excluding supercenters, The Nielsen Company).
The recession has not hit the vitamin and supplement category so far, according to one grocer. “We haven’t seen a change in sales recently,” notes Matt Olson, director of grocery for C & K Market stores. The Brookings, Ore.-based chain sells Western Family private label vitamins and supplements, but Olson says Nature’s Bounty represents the majority of his sales in the category. He promotes vitamins and supplements with monthly percent-off ads. C & K does business as Ray’s Food Place, Shop Smart and Price Less Foods.
“Thus far, the economy has not had a strong effect on sales of vitamins and supplements,” says Doug Jones, spokesperson for Northridge, Calif.-based Pharmavite, parent company of Nature Made. He points to sales increases in the category and in his company’s brand. “In times such as these, consumers seem to become increasingly aware of the importance of maintaining their overall health.”
“If you look at Nielsen or IRI numbers, sales have increased over the last five to seven months by as much as 10 percent in 2008 and 6 percent so far in 2009,” notes Harvey Kamil, president/CFO of Ronkonkoma, N.Y.-based NBTY Inc., maker of Nature’s Bounty, Sundown and many other labels as well as third-party brands. “Vitamins and supplements are a big thing in the marketplace with baby boomers. The largest takers of nutritional supplements are those 50 and over, who are aging and want to be proactive in their health.”
“The economy is affecting sales in a positive way,” says Gary Pigott, SVP, sales and marketing for Miami Lakes, Fla.-based Mason Vitamins, a subsidiary of New York-based ITO EN. “I honestly believe consumer confidence in medications has dropped, and they are more open to other therapies. Why spend $30 on a 30-day prescription refill when you can reduce it to a 15-day supply and take a complementary supplement that reduces drug nutrient depletion to the body?”
Give Them a “D”
The consumer quest for health has brought dynamic growth to the vitamin and supplement category over the past few years. For example, letter vitamins were up 12.9 percent in 2008 over the previous year. Vitamin D is the star with $44 million in sales, up 162 percent over the previous year (52 weeks ending Dec. 27, 2008, food, drug, mass excluding Wal-Mart and BJ’s, Information Resources, Inc.). “Letter vitamins are familiar and relatively inexpensive ways for consumers to promote and support personal health and wellness,” notes Jones of Pharmavite. “Most consumers are reasonably conversant in what individual letters can do for them. Ongoing news about these vitamins is generally positive. Vitamin D is a tremendous example of that.”
“Vitamin D is almost a wonder product,” says NBTY’s Kamil. “It is anti-cancer and helps the pancreas excrete insulin to avoid diabetes. Many people think we get sick in the winter more often because we don’t get enough vitamin D like we do in the summer from the sun.” Mason’s Pigott points to recent studies that show one out of seven teens in the United States are vitamin-D-deficient. “Consumers are starting to grasp the fact that a multivitamin will help but it cannot meet all the body’s functional requirements,” he says. Consumers have responded to news from the scientific community concerning the benefits of vitamin D by stocking up.
While letter vitamin sales are up, supplement sales are soaring. One probiotic SKU is up 47 percent in sales, five omega/fish oil SKUs are up 30 percent, and one CoQ10 SKU is up 15 percent. These members of the non-herbal segment of supplements are currently driving growth in the overall VMS category while multivitamins are flat overall except in specialty segments for seniors and teens.
Nature Made’s most popular vitamin and supplement products so far this year include odorless and regular fish oil, calcium, vitamins D, C, B and E, and flaxseed oil. At Nature’s Bounty, the top-selling supplements are in the area of joint care. “Glucosamine/chondroitin is still the No. 1 selling product because it has been consistently shown to be more effective than prescription drugs,” NBTY’s Kamil says. Mason’s No. 1 selling vitamin is D and No. 1 supplement is “Relax and Sleep,” which Gary Pigott believes reflects the high level of stress many consumers currently face.
Soft or liquid gel caplets are the hot new dosage form, with sales up 20 percent over last year (The Nielsen Company). Easier to swallow and absorb, softgels are changing manufacturers’ lineups. Nature Made introduced its complete liquid softgel product line in March 2008 and just added two new supplements in the convenient form. TripleFlex, “the first joint supplement in liquid softgel form,” works with the body to naturally improve joint comfort, mobility and flexibility in as little as seven days, according to Pharmavite’s Jones. Nature Made Heart & Stress Defense softgels is “the first product designed to keep the heart strong by reducing the risks of stress on the heart” and contains almost three times more omega-3 EPA.
Out of a lineup of more than 450 vitamins, minerals, herbs and other consumer health products, Mason Vitamins features over 50 softgel SKUs. The company’s newest product is Vitamin D-3 5000 IU from fish liver oil in softgel form.
While drug chains and mass merchandisers are vitamin/supplement destinations for many consumers, supermarkets can still successfully compete in this profitable category. “Grocers can also merchandise the vitamin and supplement category as a destination category,” says Pharmavite’s Jones. “They can more prominently feature the category in weekly ads as well.” Mason’s Pigott thinks grocers need to keep an “open view” of the category and entertain other vendors in their programs. “Grocers believe the prime vendors have the knowledge to turn their business around but, honestly, the prime vendor is concerned about their brand and not the overall program/presentation to the consumer.”
Harvey Kamil of NBTY believes grocers can best compete with other formats in vitamins and supplements by developing a private label program. “Nature’s Bounty (or NBTY) is the No. 1 private label,” he says. “There’s no reason grocers can’t expand their lines to compete.”
What does the rest of 2009 hold for the category? “I expect that the market will continue to do well, as is evidenced by the data we’ve seen to date,” observes Pharmavite’s Jones. “Consumers will remain dedicated to their health regimen as long as they are able.” NBTY’s Kamil predicts the rest of the year should be about the same as the first [quarter] and that the market will continue to increase at about 6 percent to 7 percent industrywide. Mason’s Pigott agrees that the market will continue to grow, but at about 3 percent to 5 percent. “Consumers are truly making health changes in their lives, and since more people are out of work, they are job-searching on the Web, and learning about new products daily,” he notes.