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New report breaks down US supplement market

By Lorraine Heller , 21-Aug-2008

Condition-specific products make up almost one-third of all US nutritional supplement sales, led by joint health and calcium, according to a new market report.

Published by Packaged Facts, Nutritional Supplements in the US estimates the overall market was worth $6.1bn in 2007, up 7.5 percent from 2006. From 2003 to 2007, the market grew a total of 17.3 percent, with a compound annual growth rate of 4.1 percent.

Measuring the size of the supplements market in the United States has always been subject to variation, due to different tracking methods and sales outlets, including the black hole of internet sales. Packaged Facts based its figures on data from IRI. For a more detailed break-down of tracking methodology, see the bottom of this article.

Market growth

The report noted that after a period of sluggish sales in 2004/2005 resulting from negative media coverage of vitamin E, the market has since rebounded and is now “on an upswing”.

Factors that have helped drive sales growth despite a general climate of economic slow-down include a renewed focus on condition-specific supplements. Baby boomers have also helped keep the market up, being a population segment with more disposable income and a high interest in health maintenance.

Condition-specific

Supplements marketed for a specific condition, including those specifically targeting men, women or children, currently make up 28 percent of total mass-market sales. This represents a growth of just over 7 percent since 2003.

Almost every condition-specific supplement product posted growth between 2003 and 2007, with the exceptions being calcium supplements and women’s supplements.

Nevertheless, calcium supplements still lead the condition-specific market, together with joint health supplements. These products recorded sales of $142m and $174m respectively during 2007. Joint health products experienced much faster growth in 2007, with the category increasing 11 percent during the year to April 20 2008, compared to just under 1 percent growth for calcium supplements.

Most popular products

Some 56 percent of US adults – or 121m people – say they use nutritional supplements. This is up from 53 percent in 2003.

Of the different supplement types, multiple formulas remain the most popular, with a 31 percent usage rate. Calcium supplements are the next most popular, (12 percent), followed by fish oil supplements (8 percent) and vitamin C (8 percent).

Fish oil supplements posted the most significant gains over the tracked period, with usage growing from 3 to 8 percent on the back of positive publicity for the heart health and other benefits of omega-3.

Going forward

According to Packaged Facts, it is baby boomers and a strong interest in the preventive health benefits of supplements that will protect the market from a serious downturn resulting from the negative economic climate.

The report predicts a small drop in annul sales growth in the nutritional supplement market. Sales growth will come in at 5 percent in 2008, compared to 7.5 percent in 2007, as the consumer quest for value-priced products causes supplement sales to shift into the mass-market channel.

However, the group predicts that overall market growth will begin to trend back upward, reaching 8 percent in 2011 and 2012, when sales are expected to reach $8.5bn.

Tracking

For the purposes of its report, Packaged Facts based market figures on data from Information Resources Inc (IRI), which tracks sales through natural supermarkets, regular supermarkets, drugstores and mass merchandisers other than Wal-Mart.

Analysis of consumer behavior is based on data from Simmons Market Research Bureau and BIGResearch.

Included in Packaged Facts’ definition of ‘nutritional supplements’ are vitamins, minerals, herbals, homeopathics and combination products.

The report excludes sports supplements and weight-loss supplements, except those that are extensions of general supplement lines (such as Bayer’s One-A-Day WeightSmart). It also excludes supplements sold as fresh cooking ingredients (e.g. fresh garlic), and supplements sold at the healthcare level. Nutraceutical foods and beverages are not included unless they are primarily a supplement or an extension of a supplement line.

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