What's driving supplement growth? Ageing, fitness & self-care
Millions of consumers are taking vitamins and dietary supplements convinced that good health, ease of illnesses or youthful vigour can be achieved through a pill. According to the UK’s Food Standards Agency (FSA) in 2008, nearly a third of people in the UK take some vitamin, mineral or dietary supplement most days, and about 15% report having taken a “high dose” supplement in the last 12 months.
As availability has grown, so have sales. Analysts PMR predict Central Europe’s supplement market will grow collectively at 7.6% annually until 2020. While in the UK alone, the market for dietary supplements and vitamins was worth more than £670m (€861.39m).
The diverse nature of supplements now offered makes the area something of a minefield for consumers. Products ranging from acai capsules to zinc, with devil’s claw to royal jelly equally entitled to be classed as a supplement. Even dosage and formulations wildly differ making it difficult to know what is worth taking and what isn’t.
According to the World Cancer Research Fund, dietary supplements contain vitamins, minerals, herbs or plant material. They can be found in pill, capsule, tablet or liquid form and are used to add to the diet, but should not be considered as a substitute for food.
Some supplements may be classified as foods while others are classed as medicines because of their effects. This means different products that contain the same ‘active’ ingredient may be classified differently.
Markets by region
Despite this range and variety, the supplements market is enjoying healthy growth worldwide. Whether it’s the industry’s inherent ties to health, the purported health benefits or general well-being, the supplements market has tapped into a vein of vitality that has seen market analysts Mckinsey and Company value the global market at $82bn (€73.6bn).
Around 28% of that growth is in the U.S., where sales increased by about $6bn (€5.4bn) between 2007 and 2012. Growth is expected to remain strong through 2017 – between 5-6% a year both globally and in the U.S.
Meanwhile Asia Pacific region has been thought of as something of a sleeping giant, with its demands continuing to pose challenges to the largely western-focused nutraceutical industry.
“Whether it means addressing Japan’s ageing nutrition challenges, Hong Kong’s suspicion of nutraceuticals that aren’t produced with local ingredients, or Malaysia’s commoditisation of the industry, nutraceuticals will have to don different hats to cater to each of these markets,” said Natasha D’Costa, associate director of food and agriculture at Frost & Sullivan.
“Manufacturers will increasingly understand that the Asia Pacific region is a market where loyalty is key, but is also fickle and price sensitive. Each country has a different story, a different need, and no longer are they willing to buy products that are not targeted to their populace. The nutraceutical industry is fast learning this message.”
Persistence Market Research’s forecast expects Asia-Pacific to dominate the global dietary supplements market for the rest of the decade to control 44% of the global market worth $84.8bn (€76bn) by 2020.
The supplements industry in Europe is expected to follow suit, with western and eastern Europe combined food supplements market jumping from €7bn to €9bn by 2018, according to Euromonitor International, with some markets set to double in value in that time.
Drivers of growth
Although the phenomenon is global, there are a number of factors in common that explain the increased interest in healthy living and associated products. The main key growth driver is the ageing population. According to the UK's Food Standards Agency (FSA), most people who buy supplements are over 55 years old. With a body of research that points towards memory enhancement, joint strengthening and a vitality boost of Glucosamine, ginkgo and ginseng, these supplements are purchased in the hope that old age can be enjoyable and pain free.
In 2009, consumers spent more than £82m (€106m) on these three supplements alone in the UK. Supplement manufacturers are well aware of how this older demographic are taking an interest in their health and are now focusing marketing efforts to target these consumers both on and off-line.
In 2014, Nestlé CEO Paul Bulcke, said the firm's nutrition, health and wellness business was core to the firm's long-term success, commenting that the firm’s strategy was driving a 'competitive advantage' for the firm in the global market all the way through its nutrition, food and beverage portfolio.
"It is linked with trends in society, the population growth, middle class building up in emerging markets,” said Nestle’s CEO.
“It is linked with an ageing population it is linked with consumers that are more aware of the nutritional dimensions in their lives and the need for quality of life."
A growing interest in personal fitness has also been cited as one influence on the market. As a result, the demand for organic products fortified with vitamins and probiotics has increased, as they act as preventive measures against health problems. Seasonal health alerts, such as flu virus, have helped fuel a consumer interest in immune-boosting supplements and help drive sales in vitamins and dietary supplements.
A Harris poll in 2010, estimated 96% of adults used online health information to assist in making decisions in the pre-diagnosis, diagnosis and treatment stages - consulting the internet before and after visits to doctors to further understand conversations with doctors and confirm medical advice after consultations.
Consumers are now more interested in overall well-being and vitality than ever before, willing to spend more on nutrition and supplements. Nielsen’s 2015 Global Health & Wellness Survey of over 30,000 individuals revealed 79% of Europeans were willing to pay more for natural foods such as GMO-free, organic, calcium or mineral-fortified products.
This demand is now being met by manufacturers, opening up new categories in order to keep up with ever-changing health fashions.
“After general wellbeing, weight management is the largest positioning platform for health and wellness food and beverages in both Eastern and Western Europe, with value sales amounting to $57.1bn (€51.2bn) in 2014,” said Ewa Hudson, global head of health and wellness research at Euromonitor International.
Let’s not forget the ageing demographic and their supplement needs. Manufacturers are making this age group a key part of their product portfolio as these consumers face a higher likelihood of needing additional supplementation to meet their nutritional needs.