There’s a shift away from commodity to branded ingredients, says Youtheory science chief

The company’s new liquid collagen and Beauty Powder supplements, for example, use Verisol, a patented form of collagen peptide marketed by German gelatin giant Gelita.

Another example is the use of KSM-66 Ashwagandha in its ashwagandha vegetarian capsules, also launched at the show.

“There’s been a shift away from commodity ingredients to branded ingredients,”​ chief scientific officer of Youtheory​​ Nick Bitz told NutraIngredients-USA at the show. He said that he has noticed the shift gaining traction in the last two years.

One main reason for this was the increased confidence of an ingredient’s identity. “It doubles up testing,” ​he said.

This means that the raw materials are tested for identity (if the ingredient is actually what it is or not, which could be hard to tell when something is grounded up into a powder); actives (if the ingredient contains the right compounds from the specific plant of animal to infer a health benefit); and microbes (testing to see if there are any harmful contaminants) twice—first by the ingredient manufacturer, and then again by Youtheory.

Another reason is the research that ingredient companies conduct on their specific form of ingredient. “When we use Gelita’s collagen, we can use a cosmetic claim. We can’t do that on ​[commodity] collagen,” ​he said.

Increased attention in beauty space​

The beauty supplement category was once dubbed perpetually almost-ready-for-prime-time in the US, because many brands have come and gone in the space, all saying that ‘this is the year’ for beauty supplements, only to see tepid sales.

Though the US has an overall much larger supplements market compared to East Asian countries, the beauty supplement space is far stronger in markets like Japan, South Korea, and China.

But last year, the US had the highest percentage increase for beauty-positioned supplements​​. As the visual-oriented Instagram grew to become the dominant form of social media and many influencers use this platform, beauty supplements are showing up on more American phone screens than ever before.

“I think there definitely has been increased attention ​[in the US], beauty is no longer a fringe or niche concept for supplements,” ​Bitz said. “US consumers are aware of beauty-from-within.”​

International sales boosting Youtheory​

Youtheory is a relatively older brand in the aging and beauty space, so even with more consumer interest for this category, it now has to compete for attention against more brands.

But Bitz said that the company has a first-mover’s advantage. “We started as a Big Box brand at Costco, so we kind of ‘grew backwards,’” ​Bitz said. This means that while most companies start at mom-and-pop shops to get into bigger stores, Youtheory’s market journey started at Costco before trickling down to smaller retailers.

Ironically, Bitz says that sales in Japan and China has helped the company grow in the past year, even though these countries have older, local brands in the category.

People love Costco in Japan, so the association between Costco and Youtheory wins over consumers, he said.

The company still doesn’t have focused efforts to market directly in China, but they found that their product was the number one selling collagen on TMall, the Alibaba-owned online retailer.

“People were buying crates of our product and reselling it there for a much higher price,” ​Bitz said. And even with a higher price tag, they were selling like hot cakes.

“So we decided we need to start marketing directly in China.” ​It’s thanks to the ‘Made in the USA’ tag.