Solutions For Healthy Sales
Vitamins, minerals and supplements offer benefits to boost the bottom line.
Whether it's due to an aging population, increased overall concern about health and fitness, or an improving economy, vitamin sales are among the fastest-growing categories in food, drug and mass merchandising outlets across the country.
According to Nielsen Scantrack, vitamin sales volume jumped 7.2 percent in 2011 over the previous year, when a healthy 4 percent increase was recorded. Private label vitamins increased 5.8 percent in 2011, versus 5.2 percent in 2010, even as branded products increased their segment share from 73.6 percent in 2010 to 75.7 percent last year.
What's going on? Are Americans suddenly becoming vitamin and supplement junkies?
Scott Patricki, director of category insights at Northridge, Calif.-based Pharmavite LLC, says the fact that our population is aging and that many consumers are more conscious of their health these days are important factors. But he adds that smart marketing and great products designed to meet consumer needs are also driving vitamin and supplement sales and offering significant opportunities for retailers to cash in.
Of the 80 major segments in the vitamin category, Patricki says 70 percent of total category growth comes from 10 segments: fish oil, probiotics, krill oil, melatonin, vitamin D, vitamin B12, CoQ10, men's multivitamins, hair/skin/nail multivitamins and Biotin.
"Those are the primary drivers that are realizing significant growth, so it's imperative for manufacturers and retailers to strive to attain more than their fair share of those top-10 growth segments," Patricki says, also stressing the importance of having a strong depth of product assortment and advertising, as well as plenty of display support for those items.
Pharmavite, whose products include the NatureMade and SoyJoy lines, last year was named a Progressive Grocer Category Captain for vitamins and supplements for the ninth consecutive year, so the company is a recognized leader in managing the vitamin and supplement category in the grocery channel.
Patricki says Pharmavite segments its products into some 20 "health solution platforms," and that major growth is being seen in the heart health, digestive health, energy/metabolism, sleep, vision and beauty segments. "They are definitely resonating with consumers' needs and with an aging population," he notes.
Effective Promotions
Through cross-category promotions, retailers can capitalize by grouping related products. For example, retailers can boost sales from consumers looking for energy/metabolism supplements by cross-promoting with those products such items as energy shots, bars and drinks. That same principle can be used effectively in any segment, Patricki suggests.
Meanwhile, Pharmavite has observed over the past couple of years that increasing numbers of consumers are shifting to higher-strength vitamin and supplement products, apparently under the theory that more is better — for example, if 1000-IU strength is good, then 5,000 IU is very good.
There has been tremendous growth in the higher-strength products, according to Patricki. "The challenge is making sure that we're providing products that don't exceed the upper limits that have been established by various bodies on nutrients," he says.
Pharmavite has found that this trend is prevalent largely among younger consumers, under age 50. "Those higher-strength products are bringing new buyers into the vitamin category that were not purchasing it before," Patricki says.
Still, he adds, manufacturers and retailers have an obligation to inform consumers so they don't overdo it.
Another important development, according to Patricki, is "the gummy craze," delivering vitamins in gummy products that provide good taste as well as the benefits of vitamins. "It gets people excited and warms up the vitamin-buying experience," he says, because it helps to attract new purchasers to the vitamin category.
Once again, it's the younger consumer who's attracted to those products.
"Some of these gummy products taste wonderful," Patricki says. "The industry's hope is that because of the great taste profile, it will increase compliance and get consumers to take the supplements they need every day. It makes it more pleasurable when they have to take their vitamins."
Affinity With Pharmacy
Patricki points out that there's a close affinity between vitamins and pharmacy, with vitamins adding a preventive element to the equation. Company research shows that purchasers of prescription drugs for chronic illnesses also are heavy purchasers of vitamins and supplements, "so they are highly synergistic from a cross-merchandising standpoint," he says.
"There is a really big opportunity that retailers need to focus on to figure out, how do we get our shoppers to buy vitamins and pharmacy within our store, instead of going elsewhere for one or the other?" Patricki observes, noting that Pharmavite promotes the fact that the company's brands are recommended by pharmacists more than any other in all of its advertising and promotional messaging.
Patricki notes that in-store pharmacists can play an important role by advising consumers who are taking specific drugs that they should consider adding a supplement to their diet, because nutrients can be lost as a result of those prescription products. For example, he says, many patients who take statin drugs to control cholesterol can feel tired because statins can deplete co-enzymes in the body. "So they really need to supplement their diet with CoQ10, which can be found in the vitamin category," Patricki asserts, adding that retailers should find ways to provide that information to their customers.
Another opportunity for retailers, Patricki says, is to appeal to moms, their primary shoppers, who understand children's need for multivitamins. One way to do that, he suggests, is to use events like back-to-school sales, where displays traditionally include backpacks and school supplies, but could also feature children's vitamins, including those gummy multivitamins that are shaped like licensed cartoon characters.
"Who's buying that? Moms," Patricki says. "They are purchasing school supplies. It's a great opportunity to have those vitamins there. It ties in nicely with that consumer demographic."
Educate Customers
Meanwhile, Gary Pigott, senior VP of sales and marketing at Miami Lakes, Fla.-based Mason Vitamins, advises supermarket operators to do everything possible to inform shoppers about the attributes and benefits of the vitamins, supplements and herbs on their shelves.
"It is important to allow store personnel to be familiar with the SKUs on their shelves," Pigott says. "Consumers are anxious and curious about products, and it's important to have assistance at the shelf. It's also a great avenue to convince consumers to try store-brand products."
To help consumers understand the benefits of specific products, Pigott says Mason includes "informed structure function claims on the label." For example, he says, most consumers don't know the value of valerian root, so the label includes the words "restful sleep."
In fact, Mason was an early marketer of formulations that are condition-specific, such as Heart Trio, Cholesterol Trio, Menopause Trio and Relax & Sleep, all geared toward helping consumers select products that are effective to treat specific conditions.
A major goal of the company is to help its retailer customers become destinations for vitamins, minerals and herbal supplements within their respective marketplaces, Pigott explains.
"We are marketing experts, and we pride ourselves on assisting our retailers in achieving their goals within the category," Pigott says, adding that the company provides materials designed to help pharmacists, store managers and associates inform consumers and provide great customer service.
"Retailers can boost sales through cross-promotions."
— Scott Patricki, Pharmavite
"Consumers are anxious and curious about products, and it's important to have assistance at the shelf."
— Cary Pigott, Mason Vitamins