Public relations consultant Suzanne Shelton, who operates the Chicago-based firm Shelton Group PR, counts both ingredient suppliers and finished goods manufacturers among her clients. She said helping companies to be more open about supply chain issues has occupied a lot of her time in recent months. They are feeling a pressure from their down stream customers for this kind of information, who in turn are getting it from the consumer, Shelton said.
Concept gaining momentum
“Those are the kinds of things I’ve been working on with my clients. In the communication with their customers it has been getting a lot more specific about where their ingredients come from, how they are sourcing them, how they are batch testing them,” she told NutraIngredients-USA.
Jeff Hilton, principal in the Salt Lake City agency Brandhive, said the concept has been gathering momentum even though he’s not sure anyone really knows what consumers understand when the term ‘transparency’ is bandied about.
“The concept to transparency on its face is appealing even though most people don’t understand what it means. I think they confuse it with claims like sustainability, or non GMO, or even organic,” he said.
More of a food issue?
Hilton said he thinks the movement is much more important among consumers of food products than among supplements. Consumers are highly engaged on the food side in knowing where their food comes from and how it’s made. Supplements by their very nature are marginalized. They’re add-ons in the business of nourishing themselves and their families, and in Hilton’s view for the average supplement user, that emotional connection is missing.
“In the supplement market I think the concept is on a simmer on the stove, not a boil. Consumers don’t make the same associations with supplements as they do with foods and beverages. I sense there is a general desire to know the things that transparency implies but I don’t think it is nearly as strong as with foods and beverages. Supplements are almost viewed as a commodity, to use an unpleasant term. They are always in a secondary position,” he said.
“I don’t agree,” Shelton said. “I think the reason we haven’t seen a hit in sales from the actions of the New York Attorney General it that companies have been doing a better job communicating their quality directly to the customer. Consumers may not be loyal to the industry as a whole, but they are loyal to their familiar brands.”
Millennials driving change
NIU's Transparency in Dietary Supplements Forum
Suzanne Shelton will join Loren Israelson, President, United Natural Products Alliance (UNPA); Steve Mister, President & CEO, Council for Responsible Nutrition (CRN); Jim Emme, CEO, NOW Health Group; and Robert U Craven, CEO, FoodState (MegaFood) for an hour long free-to-attend online forum on February 11, moderated by NutraIngredients-USA Senior Correspondant Hank Schultz, on the topic of transparency in dietary supplements. For more information and to register, please click HERE.
Hilton said that the concept is gaining traction as the marketplace changes. For him, transparency is a buzzword used mostly among the Millennials segment of the market.
"I do think there is a segment of consumers that is driven mostly by Millennials who are more aware of what transparency means. They want transparency from the company in what they are doing not just with where they are getting their ingredients, but what they are doing about recycling, about supply sustainability, about what they are doing with the byproducts of their production processes,” he said.
Some supplement brands have built their brand positioning around transparency. It’s an open question whether this concept is more useful than others might be in garnering new customers, but both Hilton that it helps companies like these forger a stronger bond with their loyal bases.
“Megafood is an example of company that has staked their fortune on that idea and they sell very well. Their consumers are very loyal,” Hilton said.
Transparency vs trade secrets
There is a natural tension within the concept of transparency, though. Some companies might argue that they’ve spent their own time and money putting together a suite of trusted vendors, be they suppliers, testing labs or other types of partners. Wouldn’t being completely open about these relationships merely give existing or potential competitors a leg up? For Shelton, this is a short sighted idea for companies that have no skeletons in the closet. Her message: Get over it.
“I’ve always been a bit mystified by that kind of attitude,” she said. “Transparency is this big buzz word, but what are we really talking about? We are talking about revealing best practices. Our clients are all very high quality, very committed to best practices and there is nothing that they have to hide. Who does your product testing? Why should that be a big secret?
"One client, a company well known for robust in-house testing, didn’t want to reveal that kind of information because of concerns the lab they use when they do have some additional testing done would then get too busy to do the work they gave them in a timely manner. I asked the lab about it and they said they were very careful to take care of their existing customers and they could accommodate growth."
“I think everyone pretty much knows what are the best labs anyway. We all know there are some companies out there that are lab shopping or might be engaged in dry labbing,” Shelton said.