Special Edition: Botanicals
Turmeric leads the charge as herbal sales continue to bloom
And while turmeric/curcumin in particular has had a good year, the rest of the category is also performing well. “Total retail sales for all herbal supplements are up 7.5% - that’s 12 years in a row that we’ve documented sales increases,” said Mark Blumenthal, founder and executive director of the American Botanical Council.
Data published recently in ABC’s HerbalGram 111 showed that herbal product in all channels in 2014 were $6.4 billion. In the years ABC has been conducting the report, sales have grown from $4.2 billion in 2000. After a decade of low single digit growth, the trend has shown more than 7% year-over-year gains in recent years.
The report covers only retail sales of herbal dietary supplements and does not reflect the sales of most herbal teas, botanical ingredients used in cosmetics, or government-approved herbal drug ingredients in over-the-counter medicines.
Sales data provided to NutraIngredients-USA by SPINS showed that sales for both single herb formulations and combination formulations have increased in the natural plus mass channels from 2014 (see figure below). This does not include direct sales data.
Such increases are backed up leading suppliers, with Travis Borchardt, VP of regulatory affairs and QA/QC at Nature's Way, telling us that Nature’s Way has experienced solid growth across its single herbal powder and herbal extract lines in 2015 and 2016.
Beth Lambert, CEO of Herbalist & Alchemist, said that growth in herbs is being driven by word of mouth among consumers, and also consumers seeking out more natural ways of supporting their health.
“I really think that the medical community is becoming more educated about herbs and supplements,” she added. “I think they may have been dragged into it somewhat reluctantly at first but I think, for us, our number one way people hear about our company is through referrals. People are also searching for ways to help them live a better, healthier and happier life. It’s no secret that inflammatory-related conditions, which may refer to diet, lifestyle, and stress, are leading people to look for healthier ways to lead their lives.”
The year 2015 was a challenging year for the industry with the high profile investigation of New York Attorney General Eric Schneiderman being accompanied by a steady flow of negative media coverage, and additional criticism coming from the likes of Sen. Claire McCaskill, D-MO, against certain categories of products. The message seems to be that little of any of this information is having an effect on the consumer level.
Indeed, the NY AG 7 - Echinacea, garlic, Ginkgo biloba, ginseng, Saw Palmetto, St John’s wort and Valerian – did not experience any kind of precipitous decline in sales following the NY AG’s probe.
Sales data provided by SPINS reveals mixed performance for the herbs since then, with Echinacea, garlic and ginkgo all posting year-on-year growth, but ginseng and Saw Palmetto have posted declines since 2014.
“Despite the negative publicity on herbs in general, dietary supplements in general, and those specific NY AG 7, four out of seven showed increases over the last year, and have shown over the last number of years,” noted ABC’s Mark Blumenthal.
For more in-depth coverage of these herbs, please read, What’s going on with the NY AG 7?
The greatest success has perhaps gone to turmeric/curcumin, which holds top spot in sales in the natural channel for the third year in a row, with total sales of $37,334,821. It also had the second-highest percentage sales growth with 32% over the previous year’s sales. In the mass channel, turmeric sales grew 118% to hit $15.8 million for 2015.
“Nature’s Way products primarily consisting of turmeric/curcumin are growing at a significant rate,” noted Travis Borchardt.
So can the growth continue? Todd King, VP Marketing, Gaia Herbs, Inc sees no reason to question that. “Gaia is the leading herbal company in Turmeric Products and the demand and growth remains strong,” he said. “Our TurmericBoosts, Turmeric Supreme line and other Adaptogenic herbs have seen continued strong growth and to support this growth Gaia is expanding our manufacturing capabilities through a major facility expansion.”
While some herbs are experiencing significant growth, others appear to be in decline. Data published in HerbalGram shows that ingredients like green coffee and Garcinia cambogia posting decreases in the mass channel of 41% and 23%, respectively, while the latter also experience a 48% decline in the natural channel in 2015 (green coffee didn’t make the top 40 in the natural channel).
“My view is that ingredients in the weight loss category in general are quite faddish,” said Nature's Way’s Borchardt. “Initial sales are driven by significant investment in marketing and/or media coverage (e.g. Dr. Oz). Furthermore, speaking from experience, weight loss is never easy and typically cannot be achieved without diet and exercise being part of the equation. Consumers may be trying these products and expecting significant weight loss without watching their diets or exercising and when the product doesn’t perform as expected, repeat purchases do not occur.”
Science could be the saving grace for such ingredients, noted Dr Guru Ramanathan, chief innovation officer at GNC. “What we are seeing is not unique to a particular channel,” he said. “Many of these things start as fads. Adoption of innovation starts off as fashion. However, as the industry matures more and more suppliers have started making investments to study these herbs in classic terms using RCTs, as more such work is done we’ll see adoption of proven interventions. Many customers recognize that they are able to use nutrition, diet, and dietary interventions, and many of these products are part of that.”
NutraIngredients-USA’s Botanicals Forum
Experts from Nature’s Way, the American Botanical Council, Herbalist & Alchemist, and GNC will discuss the challenges and opportunities in the botanicals section in NutraIngredients-USA’s Botanical Forum on September 29. The event is free to attend. For more details and to register, please click HERE.