Weight management market stagnation obscures shift away from pills toward functional foods

By Hank Schultz

- Last updated on GMT

Weight management market stagnation obscures shift away from pills toward functional foods

Related tags Weight management Nutrition Obesity

The weight management supplement market appears to be nearing the end of growth, perhaps in part because the users of the products aren’t. In weight, that is.

In theory, the weight management market ought to be one of almost unlimited potential.  The population of the United States and that of the world continues to grow.  And even in slow growth regions such as Europe the percentage of overweight citizens, ones who one could imagine could be counted on as reliable consumers of weight management products, continues to increase.

Despite fire fighting efforts, the blaze keeps growing

But one thing that might stymie that growth is the growing perception that no one pill, even when marketed as an adjunct to a program of lifestyle changes, is going to fix the problem.  The picture painted by statistics is a dismal one. Despite the hundreds of millions of dollars thrown by product formulators and consumers at the problem, the percentage of people who are overweight or obese continues seemingly inexorably to rise. It’s a slow motion health care crisis that will come to a head in the coming decades when the burden of all of the preventable illnesses related to obesity will come fully to bear.

Here are some sobering recent talking points from the World Health Organization:

  • Worldwide obesity has nearly tripled since 1975.
  • In 2016, more than 1.9 billion adults, 18 years and older, were overweight. Of these over 650 million were obese.
  • 39% of adults aged 18 years and over were overweight in 2016, and 13% were obese.
  • Most of the world's population live in countries where overweight and obesity kills more people than underweight.
  • 41 million children under the age of 5 were overweight or obese in 2016.
  • Over 340 million children and adolescents aged 5-19 were overweight or obese in 2016.

Market projected to flatten to almost zero growth

According to recent data from Euromonitor, while the obese piece of the population pie is growing, sales of products aimed at paring it down soon will not. Data from the market research organization pegged sales of “Weight Management and Wellbeing” products at $5.4 billion in the US in 2017.  That was up from $4.9 billion in 2012.  That was 11.8% sales growth with a CAGR of 2.3% for that five year period.  While that growth in the face of the potential market is anemic enough, the future in the next five years looks even less promising.  Euromonitor’s figures call for overall sales to crawl forward to $5.5 billion in 2022.  That would represent a meager 1.3% growth over that entire period with an essentially flat CAGR of 0.3%.

Anurag Pande, PhD, vice president of scientific affairs for Sabinsa, a global supplier of botanical ingredients, said in his company’s projections, the market doesn’t look quite that grim.  But it’s still not good, and the complexion of products in the marketplace is a cause for concern.

Growth of 6% in the global market for next decade may not be a strong trend. One of the reasons is that compared to any other category of health supplements, the weight management category suffered from products flooding in market with lack of scientific evidence which eroded the confidence of consumers quite a bit,”​ Panda told NutraIngredients-USA.

Paul Jarrett, CEO of supplement sampling and data mining firm BuluBox has a unique perspective on how consumers view these products.  The company gathers thousands of data points from consumers every year through its sampling service that allows consumers to get a look, feel and taste of products before they commit to buying monthly supplies or more. Jarrett’s firm has branched out to offer a number of different monthly boxes in a number of product categories, one of which is weight management.

Social media becomes powerful and uncontrollable force

BuluBox encourages social media engagement and fosters a robust interactive community among its users. This experience has convinced Jarrett that one of the thing the marketers of weight management products are dealing with now that perhaps they might not have in the past is the ability of large numbers consumers to share with each other in real time if a product is working for them.  If a number of consumers conclude that a product’s effects are too modest to seem to be worth the outlay, that word will get out quickly.

“Consumers are smarter now. They will do a Google search and read about a product for five minutes before they buy it. I’m sure the FTC action on weight loss claims has had some effect.  But if you are making those kind of claims ​(such as: Lose 15 pounds in 5 days!) you can see on social media that if companies try to post stuff like that they just get blasted. There is this education that is going among and by the masses,​ Jarrett said.

Not just pill fatigue, but disillusionment

Along with consumers getting more savvy, Jarrett said there is a definite shift in what kind of products they prefer.  One underlying metric he believes is the notion that a product that looks like a drug and is packaged like one ought somehow to work like one.  And when it doesn’t disillusionment sets in.

“Pills subconsciously are associated with pharmaceuticals.  Consumers think, ‘If I take this thing it is going to fix my problem,’”​ Jarrett said.

A shift toward more functional foods as weight management products started several years ago, almost coinciding with the start of the company he founded with his wife Stephanie in Lincoln, NE in 2012.

“There has been this slow shift where people don’t want to call it weight loss or weight management. They think about more in terms of health lifestyle changes, and with that comes a different product mix,​ Jarrett said.

“In the beginning our weight loss boxes were all pills and powders. But now people are thinking in terms of reducing their carbohydrate or sugar intake as a way toward weight loss. It’s almost as if consumers are wiser about the language around the product versus the benefit or functionality of the product.  That’s driving the shift away from pills to functional foods.  They’re not popping a pill but instead are eating a food that is low carb,​ he said.

The inexorable rise of functional foods

Jarrett said part of his job is to comb trade show floors and store aisles to see what’s trending in the marketplace, and what new players they might benefit from his company’s service.  When taking a tour like that, the trends become plain, he said.

“I visited some GNCs and Vitamin Shoppes in New York recently and I’ve never seen so many nutrition bars calling out ketogenic benefits. These traditional vitamin and supplement stores are getting into specialty and healthy foods and snacks.  You can walk the supplement aisle in a Target or a Walgreens and you can see this infiltration of functional foods,​ he said.

Jarrett said that these days the weight loss boxes his company sends out to its monthly subscribers are mostly full of functional foods samples.  He believes that even in a flattening market this still will be an opportunity for weight loss ingredients as the supplement delivery mode declines.

“Looking at traditional weight loss pills, that is just not where these brands are going to make their money. But there is still room for legacy weight loss brands to succeed, as when Hydroxycut started to come out with protein bars and drinks, he​ said.

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