The session, titled Current Issues in the Botanicals Marketplace, featured Mark Blumenthal, founder of the American Botanical Council, Michael McGuffin, president of the American Herbal Products Association, and industry consultants Marc Brush and Steven Dentali, PhD. The session was part of NutraIngredients-USA’s Online Botanicals Event, which also featured a session with Rick Kingston, PharmD, president of scientific and regulatory affairs at SafetyCall International and Roy Upton RH, DipAyu, founder of the American Herbal Pharmacopoeia.
Catching onto the zeitgeist
Brush said recent data he has seen supports the notion that the botanical end of the dietary supplement industry—that is, single and multiple herbal formulas—is the best-performing part of the business.
“What I found was that the botanical sector has outperformed the dietary supplement industry as a whole,”Brush told the audience. Brush said that botanicals are well-placed to benefit from broader trends in the culture. Consumers are increasingly gravitating toward clean label ideas. While the term ‘natural’ has no regulatory meaning, it means something to consumers, something that they like.
“There is really no more ‘natural’ place to be inside the dietary supplement industry than to be in botanicals,”Brush said.“That’s part and parcel of the zeitgeist we’ve seen in foods. If we’re cleaning up foods, plants is the place to be, and in dietary supplements it’s botanicals.”
Brush said the numbers back up those assertions. He quoted recent data from his former employer NBJ that showed that sales of botanical products showed a 7.7% growth rate in 2016, which capped four consecutive years of better than 7% growth. That’s better than the 7.4% growth rate of sports nutrition, the former leader whose sales have been cooling off over a period of several years, and the 7.1% growth figure notched by meal replacements. Brush said sales of botanical dietary supplements reached $7.5 billion in 2016 and are slated to hit $10 billion by 2021.
Ingredients go into many markets
McGuffin added that his organization tracks herbal product sales in all applications, not just supplements, because suppliers sell into many markets, including foods, personal care, etc. Sales of cannabis, for example, reached $6.7 billion in the US and Canada in 2016, and kombucha, which AHPA considers to be a botanical category of its own, hit $500 million worldwide in that year.
“We think the industry is closer to $25 billion when you put it altogether,” McGuffin said.
McGuffin said one of the benefits of being in the botanicals business is that companies can rely on a very committed set of consumers. Herbal product users are far more active than those who take a multivitamin and little else. And those consumers are actively seeking information about the products, which makes the job of promotion that much easier.
“Herbal supplement users average about five supplements a day,” McGuffin said. “Where they get their information is to me less interesting that realizing that they will get the information. I think we have a very motivated buyer.”
ABC, Blumenthal’s organization, also tracks sales and is in the final throes of preparing its annual market report. Blumenthal said the data ABC has gathered so far mirrors what Brush and McGuffin said.
“The growth is not meteoric. But it is a generally healthy trend upwards. This is a long term trend that seems to defy some of the negative press about supply chain issues,”he said.
Dentali said he thinks healthy growth rates are here to say.
“I don’t think it’s a fad. Herbal practices have run through societies since the beginning. The question is how do we bring that back to the consumer with attention to quality and the supply chain,”he said.
Online event on demand
To see a replay of this session, or other sessions in the event, which included presentations from Sabinsa Corporation and Valensa International, click here.