Future looks increasingly bright for herbal supplements, market researcher says
Herbal supplement users, in addition to being loyal, are also higher-volume users, too, French said. The average supplement user takes about 3 supplements a day while consumers who say they use herbal supplements take an average of 4.8.
“There are some in this room who will say, ‘That’s not very much. I take 15 a day,’ ” French told a breakfast meeting of the American Herbal Products Association last week in Anaheim, CA. “But you have to understand this is the average consumer and for them, five supplements a day on top of the other things they are doing is quite a lot. Identifying themselves as herbal supplement users was the No. 1 predictor in how many overall supplements they are taking.”
French spoke on the state of the herbal products market at the organiztion’s annual breakfast meeting. His talk was a mixture of good news and sobering statistics, but underpinned by the strong commitment that characterizes herbal product users.
Depressed launch activity
As far as the new launches have played out, the economic downturn has had a profound and lasting effect, French said. New herbal supplement launches peaked at 319 in 2008 and were still above 300 in 2009 as launches set in motion before the financial collapse went forward. By contrast, only 106 such products were launched in 2013, but the trend line in the 2010-13 time frame has been positive.
“We are down to about 100 new product launches per year, but the trend line is fine,” French said. “You have to balance that with some good news, and that is that it appears that a lot of those new launches have been successful.”
French said herbal supplement users continue to exhibit a high level of commitment. Data from 2013 show that 36 million US adults say they use herbal supplements, up 33% from 2011.
“Consumers continue to state that herbal supplements are a very important in how they maintain a healthy lifestyle,” French said.
Younger consumers are big believers
As far as how usage breaks down over age groups, French had very good news for the group as far as prospects for the future are concerned. Younger consumers are bigger believers in the safety and efficacy of herbs than are their elders.
“One reasons we are seeing higher usage among youger generation is that they are much more likely than older Americans to believe that herbs are safe and effective,” French said. According to NMI’s data, 40% of millenials say herbal supplements are very safe and 35% of them believe the products to be very effective. Those numbers for ‘matures’ are 19% and 8%, respectively, with an almost linear decline in those values from the youngest consuming groups to the oldest.
French said he continues to see strong opportunity for herbal supplements. The macro trend winds that fill the sector’s sails will blow ever stronger.
“This has also been driven by the increase in the cost of health care. There is a general trend toward more consumer-directed health care. Increasing co-pays are driving a whole range of consumer behavior. Add in the high cost of some drugs and concerns about pharma side effects,” he said.
“In our youth-centric society thre is a concern to hold back aging and to hold off on age-related health issues. And acquisition interest in the space from pharmaceutical and big CPG companies may drive further growth by providing more marketing dollars,” French said.