State of Natural: Industry on Track to Reach $318.6B in Sales in 2024 and $386.4B by 2028
This article first appeared in the November 2024 issue of Presence Marketing’s newsletter.
By Steven Hoffman
The natural and organic products industry is on a solid growth curve, supported by rising consumer demand for better for you products, according to the editors of Nutrition Business Journal (NBJ).
Surpassing $300 billion in sales on 4.8% growth in 2023, NBJ projects sales of natural, organic, regenerative and sustainable products in the natural channel will continue to grow at about 5% per year to reach $318.6 billion in 2024, and $386.42 billion by 2028, with the market “showing no signs of slowing down.”
Dominated by the natural and organic food and beverage sector, which commands three times the market share of supplements and seven times that of the natural living category, “the natural products industry has infiltrated every part of brick-and-mortar and online retail and is outpacing conventional products’ growth. Slow and steady is winning this race,” reported the NBJ editorial team in its State of Natural Report: Four-Year Forecast, 2024 - 2028, published in September 2024.
Sales of natural, organic and functional food and beverages account for 69.3% of the overall natural products market. According to NBJ, this category will continue to dominate the market, predicting that sales will grow to $220.78 billion in 2024, and will reach $265.2 billion in sales in 2028. Strong growth in this sector is driven by improved product quality and taste, global flavors, and plant-based, paleo and carnivore diet trends, among others.
According to NBJ, the majority, or 63.7% of natural and organic food and beverage sales are occurring in mass market retail stores, a trend that will continue as natural products become more accessible across the country. Traditional natural food retail stores command 28% of the natural and organic food and beverage market.
Supplements: The Roller Coaster Ride Is Over
For the dietary supplements category, “the roller coaster ride is over,” NBJ reported. “After a sobering deflationary period following stratospheric growth during the Covid-19 pandemic, the supplements industry is settling into steady, stable growth in every category. With the combined Sports Nutrition and Meal Replacements category and Herbs and Botanicals leading the way, supplements are projected to grow at around 5% each year through 2028, from $67.43 billion in 2024 to $82.81 billion. Many consumers who discovered supplements in their panicked searches for immunity hacks during the pandemic appear to be sticking with the vitamins and herbs they started taking, and the industry is mainstreaming as a result,” said NBJ.
While sports nutrition and meal replacements are projected to grow between 5% and 7% over the next four years, sales of vitamins and minerals, which took a post-pandemic hit (NBJ predicts growth of only 2.1% in this category in 2024), are projected to grow 3.7% in 2028. However, vitamins and minerals control the largest market share (30%) among the dietary supplement categories.
Herbs and botanicals are projected to be the fastest growing supplement sector, and annual growth will reach 7% by 2028. Market share for sports nutrition and meal replacements is expected to remain steady over the next four years, ranging between 26% and 28%. Herbs and botanicals, too, are predicted to maintain a steady market share of about 20% over the next four years.
NBJ also noted that in the dietary supplements category, in particular, direct to consumer channels are driving significant growth. “With annual growth between 6% and 7% — nearly triple that of Natural and Specialty—the Direct-to- Consumer channel is driving growth during the forecast period, while Natural and Specialty continues to lose market share, falling from 26% in 2024 to 23.2% in 2028,” NBJ predicted.
Natural Living: Small but Growing Fast
As consumers learn more about the dangers of environmental toxins, microplastics and ingredients used in conventional beauty care products from mainstream media, social media influencers and others, they are becoming increasingly aware of the fact that it’s not just what you put in your body, but also what you put on your body. While the Natural Living sector takes up the smallest slice of the natural products industry pie at a 9.5% market share, it is expected outpace overall industry growth, growing at 6% per year from $30.38 billion to an estimated $38.41 billion in sales in 2028.
According to NBJ, the natural and specialty channel is projected to lose market share of natural living products between 2024 and 2028, but it will remain the second largest channel behind mass market. By 2028, sales of natural living products in mass market will be more than double those of natural and specialty. Also, while mass market and e-commerce are driving much of the natural living market, practitioners and multi-level/network marketing “are the only channels projected to see increased growth throughout the forecast period,” said NBJ.
The principal analysts, authors and editors of the Nutrition Business Journal State of Natural Report: Four-Year Forecast, 2024 – 2028 were market research analyst Erika Craft, industry analyst Christian Irwin, senior editor Robyn Lawrence, managing editor Hannah Esper and content & insights director Bill Giebler. Sources for the data include SPINS, IRI Group, Natural Foods Merchandiser Magazine, New Hope Network and others. The report is available for $125.
Learn More
Nutrition Business Journal State of Natural Report: Four-Year Forecast, 2024 - 2028
Presence News: Natural Products Industry Reaches $303.3 Billion in Sales in 2023 on 4.8% Growth
Steven Hoffman is Managing Director of Compass Natural, providing public relations, brand marketing, social media and strategic business development services to natural, organic, sustainable and hemp/CBD products businesses. Contact steve@compassnaturalmarketing.com.
Are You Expo Experienced? Insiders Share Tips for the Best Expo West
By Steven Hoffman
Natural Products Expo West, first launched in 1981 and held every year since, at the Anaheim Convention Center in Anaheim, California, is the world’s largest natural and organic products trade show. Spread across five days, this year’s event, held March 12th to 16th, is expected to attract more than 65,000 trade visitors and over 3,000 exhibiting companies.
For business leaders, founders, entrepreneurs, retailers and others in the natural channel, attending Expo West is considered essential. However, as it can be costly, time consuming and a bit overwhelming, we asked industry insiders and colleagues their favorite tips to make the most of the show. Read on for some helpful hacks to maximize your Expo experience.
Karen Farrell, VP of Brand Services, PRESENCE
First, be sure to visit PRESENCE’s Hospitality Room at Expo West, Room 210A, at the Anaheim Convention Center. Trade members are welcome to visit during show hours for snacks, beverages, a place to meet or take a break, and to catch up with Presence Marketing team members.
On a self-care level, realize that all the restaurants and coffee shops are going to be crowded, for breakfast, in particular. Consider putting together a Whole Foods Market (or other) order with some basics for your hotel room to be delivered the night you get there. That way, you can get some nourishment and avoid long lines. Also, throw a healthy snack in your bag for nourishment during the day. This helps avoid ‘trade show stomach.’ I only sample things I haven’t tried before — samples are meant to be samples, not lunch! Also, make restaurant reservations well in advance of the show, preferably within walking distance, if possible. And if you can, consider making hotel reservations for next year’s (2025) event as soon as possible, as hotel space near the convention center fills up fast and is always in demand.
Leanne Thorsson, Director of Health and Natural Foods, Traditional Medicinals
Set appointments in advance; everyone’s time is tight at Expo West, so if you’re not on the calendar, you may not get the meeting. There’s always excitement and an extra level of engagement at the show. Plan in advance what you wish to accomplish — if it’s to visit booths, make a plan of what you want to see. We schedule meetings with account executives, regional managers, and major retail, distributor, and other key partners. This year, we are meeting with two new export partners for the first time; the event gives us an opportunity to meet with them in person and say hello. The show is a great way to get that human interaction, make the connections, talk about some of the larger items, and then set the stage for future conversations. Also, be sure to make unplanned time to walk the show and let some magic happen.
Stacy Gangestad, Director of Sales Management, Gimme Seaweed
Working as an exhibitor on the brand side, none of us in sales ever want to leave the booth, so that makes for long days. Taking a walk each day and getting some fresh air beforehand helps set the stage for the rest of the day. Wear comfortable shoes and get the extra padding under the carpet for your booth. We’ve learned over the years that a lot of initial conversations happen, but not a lot of business decisions are made at the show. It’s all about the follow up from there.
Also, consider after hours networking opportunities at Expo West: Go out to dinner with brokers and retail partners; attend events where there may be opportunities to connect with key buyers and other decision makers. Sometimes, you might run into a key contact just by going to the Hilton and Marriott lobbies, where many gather after each day of the show. We exhibit in Hall E — it’s a great location and the days go by fast because of all the positive energy and great vibes down there.
Jonathan Lawrence, VP of Center Store, Fresh Thyme Market
I’m a huge fan of Expo West. It’s very impressive, but can be very intimidating, not only to retailers and new buyers but also to brands (especially new brands). Tip number one is to capture the retailer’s attention. First thing you want to do is share the highlights around your brand strategy, specifically, why did you create this product and what makes it different from other products currently on shelf.
Have a positive and open-minded attitude. Be open to having conversations with people at all levels. When you’re talking about your brand, your product, talk to everyone that will listen, because everyone’s a consumer. Your product could be the next new product they tell people about. They might be able to give you great feedback, they might be able to make a great connection for you. Talk to the other brands when you’re at your booth. Some of those best connections are the people right next to you. The natural foods community is all connected.
Be efficient with your time. There are thousands of brands out there, so you don’t get a lot of time. Make sure you’re prepared. Have your elevator pitch ready, have maybe a sell sheet and product samples ready. Make sure you’re engaging. Don’t be sitting back behind your booth. Don’t be on your phone, looking down. Act like you want to be there, enjoy it, enjoy the fact that you’re in front of all these people at the biggest trade show.
I would focus on new retailers or new people that you don’t have current relationships with. And then keep conversations going. Not everything happens on the trade floor – great connections can be made in hallways, in passing on the show floor, off the show floor and at dinner. Utilize all the time that you have. While you’re there, you’ll have plenty of time to rest when you get home.
As a retailer, once we get home, we’re exhausted. But then Monday comes around and it’s back to work. Take a little time, but then make sure you’re following up. I would say a personalized note, don’t just send a canned email, that’s not very personal, it doesn’t show that you took the time to connect after. Send samples, I would say between a week to two weeks after. If it goes further than that, it might not be top of mind anymore. So, make sure you act fast.
Benji Fitts, Director of Growth Strategy, SPINS
So, you’re at your booth, spent a lot of money to get to Expo West, you’re meeting people, shaking hands, all that sort of fun stuff. And you’re going to need this little piece of paper, your sell sheet, to talk about your product.
There are just some simple things that you can do to make sure that your sell sheet looks good. First of all, it’s usually a piece of paper, 8½” by 11”, usually double-sided. You don’t have a lot of visual real estate so really, this has to be an amalgamation of the best things that you could possibly say about your product. Be brief, be succinct, and get the message across. Second, if you have the sell sheet in front of you, squint your eyes at it and if the biggest, most unique thing about your product, or whatever message you’re trying to convey, isn’t immediately apparent, then it needs to be fixed.
These shows are really all about discovery, finding out what’s new, what’s next. If this is what’s driving your product, is what is differentiated, innovative, what’s new and fresh about whatever you’re making, make sure that’s the primary message that a user is going to receive whenever they pick up one of these pieces of paper.
The storytelling element is really what drives a lot of the passion behind things. It’s a very passionate group of buyers, it’s a passionate industry, so lean into that a little bit, right? Make sure you’re highlighting sustainability and the key differences between you and the competition. It’s also smart to sometimes talk about your distribution partners or other people who you are already partnered with … and don’t forget to put your contact info and a call to action. Don’t just put a name and a phone number on there, but say, ‘Give me a call and let’s do business together.’
Allison Salvati, VP, Compass Natural; Former Marketing Lead for Bhakti Chai and noosa yoghurt
If you’re an exhibitor, you’ll want to collect contact information from as many people as you can who visit your booth. It’s up to you to collect that data; New Hope won’t share attendee or exhibitor contact lists. As such, it is recommended to purchase one or more seats on Expo West’s lead retrieval app. With it, you can scan badges using your smartphone camera, and at the end of the show, download contact info for every individual you and/or your team scanned. Also, consider cost-effective opportunities to amplify your brand at the show, including applying for a NEXTY Award for your new products, displaying in the New Products Showcase, and considering some of the more budget-minded sponsor opportunities for brands at Expo West, such as the Retailer’s Early Access Box. Check in to your Expo West Exhibitor Hub dashboard often so you don’t miss important deadlines, such as shipping to the show. Take advantage of Expo West social media tools, too, to promote your exhibit at the show.
Jim Slama, Managing Director, Naturally Chicago
Expo West is the big kahuna of trade shows in the natural products industry. Last year 65,000 attendees came to visit the booths of 3,000 vendors showing their wares. For brands, there is no better place to connect with retail buyers.
Michael Movitz, Co-Founder, Brandjectory; Managing Partner, The Movitz Group
My advice would be to attend as many social events as possible to network, network, network! I also suggest using a digital business card like Blinq or Flowpage. They’re easy to use, environmentally friendly and, in addition to contact information, can include links to your website, social media profiles and other online resources. Also, don’t forget to fully charge your devices and bring a portable phone charger – trade shows can be draining on your device’s battery, and having a backup charger can be a lifesaver.
Kelly Miano, Brand Strategy, Innovation and Launch Leader
Follow up. All of those connections you made are great but all that is forgotten if you don’t follow up in the weeks/months following Expo. Be selective in your sampling — try not to go back and forth between savory and sweet, your stomach will thank you. Drink more water than you think you need. It will help with headaches and you won’t be so tempted to try every sample. It’s easy to get sensory overload; it’s OK to take a break when you need it. Expo can be stressful — we’re on little sleep, excited, nervous, under pressure to land a sale. Everyone is trying to pack in as much as possible into a few short days. Assume positive intent, be gracious and kind. This is our industry, we are what we make it.
This article is based on personal interviews with industry leaders; a seminar hosted on Feb. 7, 2024, by New Hope Network and Naturally Boulder entitled “Beyond the Booth: A Blueprint for Creating Unforgettable Tradeshow Experiences”; and a Feb. 15, 2024, webinar hosted by Naturally Chicago, “Master Your Retailer Sell Story for Expo West.” You can access the Naturally Chicago webinar recording here.
Steven Hoffman is Managing Director of Compass Natural, providing public relations, brand marketing, social media and strategic business development services to natural, organic, sustainable and hemp/CBD products businesses. Compass Natural serves in PR and programming for NoCo Hemp Expo and Southern Hemp Expo, and Hoffman serves as Editor of the weekly Let’s Talk Hemp Newsletter, published by We are for Better Alternatives. Contact steve@compassnaturalmarketing.com.
Naturally Network Mid-Year Update: Natural Products Outpacing Growth of the Overall Marketplace
This article first appeared in Presence Marketing’s July 2023 newsletter.
By Steven Hoffman
There are “some key areas where natural continues to be really important and shoppers are continuing to engage despite inflation where they're saying, ‘Natural's important to me and I will continue to spend a little bit of extra money despite price.’” – Jessica Maniscalco, SPINS
Addressing the ongoing theme of inflation, Jessica Maniscalco, Senior Retail Insights Manager of market intelligence firm SPINS, said, “While the impact is still present in natural and specialty accounts, it’s being felt at a lesser rate than in conventional channels.”
Speaking at a recently held mid-year industry trends update webinar hosted by Naturally Network, Maniscalco shared that the drug, convenience and natural channels have seen lower price increases, “which lowers the growth rate compared to the conventional channel,” where price increases have been higher.
Source: SPINS
According to multi-year data tracking by SPINS, Maniscalco said that over time, “overall dollars have continued to grow across all positioning groups while units have been negatively impacted, especially with conventional products, which holds the lion’s share of sales.” Thus, while inflation is impacting overall unit growth everywhere, conventional products are being the most impacted.
“We all know what was going on with eggs most recently and how high the prices have gotten in terms of base price over the past year. So things like eggs, cereal, and bars were among the highest to increase their price. But what you'll notice that during this same time period is that natural and organic products within these same categories have held their prices at a much lower rate than the overall total category during the same time,” Maniscalco said.
Top Natural Categories Show Resilience
Maniscalco noted the top fastest growing categories for natural products, including infant formulas, creamers, salsa and dips, jerky and meat snacks, refrigerated entrees and a few others, are experiencing “exponential growth” versus overall category performance. She also pointed out that there are “…some key areas where natural continues to be really important and shoppers are continuing to engage despite inflation where they're saying, ‘Natural's important to me and I will continue to spend a little bit of extra money despite price.’”
In analyzing the composition of conventional, specialty wellness and natural products sales in brick & mortar retail over the past year, Maniscalco reported that specialty wellness products comprised about 15% of overall product sales. “But when it comes to dollar sales growth, it's lagging while contributing to only 10% of that overall bump. So, this is saying that specialty wellness sales are going up or the dollars are going up, but the price is holding at a lower rate than the conventional and natural products in these channels, so contributing less to the overall growth.”
Maniscalco also reported that, outside of grocery, pet care products and alcoholic beverages also continue to experience significant growth in the natural channel, and advised retailers to be aware of such attributes as “organic,” whose prices have held steadier over time compared to their conventional counterparts.
Source: SPINS
The Rise of the Values Oriented Shopper
In addition, Maniscalco shared data regarding the impact of the values-oriented shopper. “Value oriented has to do with people that are associating certain values or keeping those top of mind when they they're shopping at a store and engaging with products. And almost 50% of shoppers are considered value oriented and they shop differently. Almost 90% of them shop at least once a week, which is 1.2 times a more than the average shopper. So, they're a very valuable customer. When asked what was most important to them when they are going about their everyday shopping or look for new products, is they were really prioritizing ‘good for the planet’ attributes very highly” Maniscalco said.
With such a focus on sustainability, “shoppers are looking more and more now at not only what's good for you health-wise, but how the impact can really go further and whether it's good for the planet, good for animals, etc.,” she noted.
“The other thing that value oriented shoppers are looking for more and more now is functionality, and functional ingredients have been on the rise for several years now. But, it's great to see that it's no longer limited to just the vitamin section or beverages or bars, but really across all aisles we're seeing some type of integration with availability, and shoppers are really looking to get more bang for their buck now,” Maniscalco added. “We know that adaptogens in the form of mushrooms have been seeing huge gains in acceptance, especially since COVID, and they are being integrated in many ways across the store.”
The values oriented shopper “is a very valuable customer. When asked what was most important to them when they are going about their everyday shopping or to look for new products is they were really prioritizing good-for-the-planet attributes very highly. The key takeaway here is how important this shopper is,” Maniscalco emphasized.
SPINS will be releasing a full report later this summer.
Source: SPINS
Steven Hoffman is Managing Director of Compass Natural, providing public relations, brand marketing, social media and strategic business development services to natural, organic, sustainable and hemp/CBD products businesses. Compass Natural serves in PR and programming for NoCo Hemp Expo and Southern Hemp Expo, and Hoffman serves as Editor of the weekly Let’s Talk Hemp Newsletter, published by We Are for Better Alternatives. Contact steve@compassnaturalmarketing.com.
Natural & Organic Industry Set to Surpass $300 Billion in Sales in 2023, Despite Slower Growth, Inflation
This article first appeared in Presence Marketing’s May 2023 newsletter.
By Steven Hoffman
The U.S. natural and organic products industry is on pace to surpass $300 billion in total industry sales in 2023, despite slower growth and inflation, according to early estimates by Nutrition Business Journal.
Presenting the data at Natural Products Expo West in March, New Hope Network SVP and Market Leader Carlotta Mast said, “This would represent a doubling of industry sales over the last decade. That’s huge. We are a sizeable, impactful, meaningful industry. We’re not a fad anymore. We’re not this niche industry.”
Photo: Unsplash
U.S. consumer sales of natural and organic products reached $278 billion in 2022, with growth slowing from 7% in 2021 to 5.4% in 2022, according to preliminary research by Nutrition Business Journal, based on data provided by market research firm SPINS. This follows an unprecedented spike of 10% growth in 2020, as a result of the pandemic. Sales growth is expected to recover somewhat going forward, according to Mast, and is projected to reach 6% in 2024 and 2025.
The bulk of the growth in 2022 was driven by natural, organic and functional food and beverage sales, led by carbonated drinks, dairy alternatives, “better-for-you” sweeteners, baby products and canned and dried soups. These categories outperformed the overall natural and organic products industry, Mast noted. In functional foods and beverages, sports and energy drinks, soft drinks, frozen desserts and snack chips that include functional ingredients such as mushrooms, adaptogens, electrolytes, prebiotics and healthy fats helped drive sales in the category.
Hitting a milestone in 2022, as well, were sales of organic food and beverage products, with sales estimated at more than $50 billion. According to Mast, this figure represents a doubling in organic food and beverage sales since 2014. Product categories that performed strongly in the organic sector last year included organic baby formula, candy, dips, soft drinks and yogurt, according to New Hope and SPINS data.
However, after seeing record growth in 2020, most impacted by inflationary pressures was the dietary supplements category, which rose only 1.7% in 2022 to $60.9 billion in sales, based on the data presented at Expo West and reported on by Food Navigator-USA.
Kathryn Peters, Chief of Staff at SPINS, shared with attendees at Expo West that natural and organic foods are continuing to expand into the mainstream, with sales of natural products in conventional grocery and convenience outpacing growth in traditional natural food stores. Growth in sales of natural products in 2022 increased 9.2% in convenience, followed by a 7.4% increase in “conventional multi-outlet,” and a 4.1% increase in regional grocery, compared to 2.5% growth in the natural channel, based on SPINS data and reported by Food Navigator-USA.
While shoppers continue to look for deals and best prices across multiple channels including supermarkets, mass retailers, club stores and online to help reduce the impact of higher food prices, according to The Hartman Group and FMI — The Food Industry Association, 32% of shoppers concerned about rising food prices reported buying fewer items as a strategy to save money in February 2023. That’s down from 41% of shoppers who reported buying fewer items to save on food costs in October 2022.
“Our national survey reveals persistent consumer concern about food and beverage prices, as the weekly spend for groceries increased in late 2022 and early in 2023,” Leslie G. Sarasin, president and CEO of FMI, said in a statement. “To address higher prices, shoppers are visiting more stores and seeking deals to stretch their dollars but are now less likely to cut back on the number of items purchased compared to six months or a year ago. This is an opportunity for our industry to continue connecting with shoppers on food-inflation-mitigating solutions.”
According to FMI and The Hartman Group’s findings, food price concerns cut across shopper demographics, however, “Boomers are more worried about rising food prices than any other group, with 80% showing concern in February 2023 versus 69% in October 2022. Millennials polled close behind with 76% saying they are concerned, 5% more than one year ago. Such concerns about food costs coincide with an increase in spending in this inflationary environment. In February, on average, consumers spent $164 per week on groceries, up from $148 in both October and February of 2022,” FMI said.
Natural and organic food shoppers, in particular, may be less sensitive to price than traditional shoppers, but they still want quality, taste, nutrition, value … and sustainability. Younger consumers are driving demand toward brands that reduce waste and minimize carbon footprint and environmental impact. “The values-oriented shopper is a really important and valuable shopper,” Peters of SPINS noted, and according to Nutrition Business Journal, organic products are one of the last places consumers say they are willing to trade down to fight food inflation.
In a Chicago Tribune feature article published on April 3, 2023, Tonya Lofgren, Marketing Manager of Ciranda, a leading organic ingredient supplier based in Hudson, WI, said, “What’s cool about the natural and organic shopper is that if they value that, they’ll prioritize it over other ways to adjust spending because they realize how important it is.” Ciranda CEO Doug Audette added, “We are seeing consumers rationalizing their spending decisions. Overall, that has tempered the growth in organic. But we see no letting up in the long-term growth of organic, sustainable and fair-trade ingredients.”
In a March 2023 organic market report, USDA reported that, after a surge in pantry stocking pushed sales to record heights in 2020, organic food sales declined for the first time in decades in 2021 on an inflation-adjusted basis. However, “more than 15 million new customers entered the organic and natural foods market between early March and mid-April 2020,” USDA said. Time will tell if these consumers stick with organic.
According to USDA’s market report, organic consumers are diverse in terms of race, ethnicity, education, and income, though millennials purchase organic food at larger rates than other generations. Households with children are also more likely to purchase organic food than households without children, USDA noted.
Yet, challenging new and dedicated organic consumers alike is the fact that organic foods are seeing some of the steepest price hikes amid stubbornly high food inflation. Prices for organic fruit and vegetables rose 13.1% over the past year, compared with just under 10% for conventional produce, according to a February 2023 analysis of USDA retail pricing data by Lending Tree.
Among all the food groups included in Lending Tree’s analysis, organic chicken prices increased the most, at 19.5%. “That's more than three times the price jump for conventionally raised chicken, which rose 5.9% over the last year, the report shows. For households already struggling with the nation's worst bout of inflation in 40 years, such spikes could force many consumers to opt for nonorganic options instead,” CBS News reported.
Sales data for 2022 show organic fruits and vegetables growing in revenue but declining in sale volume, according to the Organic Produce Network. However, that’s a common theme across the food industry as consumers pay more for less in the face of heavy inflation, the Chicago Tribune noted.
According to the Tribune, a quarter of consumers surveyed by Nutrition Business Journal over the past year said they’re unlikely to stop buying organic produce, packaged food and meat to save money on groceries. Fewer than half of respondents said they are likely to cut those products out.
Steven Hoffman is Managing Director of Compass Natural, providing public relations, brand marketing, social media, and strategic business development services to natural, organic, sustainable and hemp/CBD products businesses. Compass Natural serves in PR and programming for NoCo Hemp Expo and Southern Hemp Expo, and Hoffman serves as Editor of the weekly Let’s Talk Hemp Newsletter, published by We Are for Better Alternatives. Contact steve@compassnaturalmarketing.com.
Market for Certified Glyphosate Residue Free Products Grew 170% Year over Year
Photo: Pexels
This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
Leading market research provider SPINS reported in partnership with the Detox Project that sales of products that are certified Glyphosate Residue Free increased 170% year over year, from $197 million the previous year to $533 million in 2021. The Glyphosate Residue Free certification program was launched by the Detox Project in 2017, reported Sustainable Pulse. It is now one of the fastest growing certification programs in North America, according to a recent study conducted by Linkage Research & Consulting.
More than 90 brands have certified some or all of their products as Glyphosate Residue Free, including Oatly, MegaFood, Uncle Matt’s, Wedderspoon, Bluebird Botanicals, Malk, Nutiva, Once Upon a Farm, Califia Farms, Chobani and others. The certification program is administered by the Detox Project, a research and certification platform that supports transparency in food and supplements.
Henry Rowlands, Director of The Detox Project, said in a statement that “it is encouraging to see that consumers are becoming more aware of the harm that environmental toxins such as glyphosate can cause to themselves and their families. We support a toxic free future for our children and this can only be reached through mass public awareness. Food and supplement brands play a vital role in keeping consumers safe from toxic chemicals. The unsustainable industrial agricultural system, which has been poisoning the planet for so many decades, Is based on one single chemical – glyphosate. It is about time that we move towards a more regenerative future with glyphosate-based weed killers left in the past, where they belong,” Rowlands concluded.
Nootropics: An Emerging Trend in Cognitive Nutrition and Brain Performance
Photo: Pexels
This article originally appeared in Presence Marketing’s October 2021 Industry Newsletter
By Steve Hoffman
From young students, tech professionals, writers and others looking to enhance brain performance, focus and productivity to aging individuals seeking to boost cognitive health, nootropics is emerging as a significant category in dietary supplements. While consumers may not be familiar with the term itself, they are increasingly turning to nootropic products to help with learning, concentration, remembering, recalling information, gaining new skills, alertness, focus and other activities that require cognitive and mental function, says leading natural products market research firm SPINS in its recent The State of Natural report.
Nootropics (sometimes referred to as “smart drugs”) is a catch-all term for products that are reported to enhance brain and cognitive performance, from food and nutritional ingredients to dietary supplement formulations and even some prescription drugs. Taking gingko biloba or even drinking a caffeinated beverage are examples of taking a nootropic to boost memory or enhance alertness and focus.
According to SPINS, sales of functional nootropic ingredients including bacopa, phosphatidyl serine and DMAE all grew over 100% over the 24 weeks ending June 13, 2021. Other nootropic nutritional ingredients seeing sales growth include GABA, L-Theanine, Acetyl L Carnitine, gingko biloba, DHA, medicinal mushrooms, and more.
“A lot of companies are turning to a blend of different nootropic ingredients for a synergistic effect on cognitive health,” noted Scott Dicker, Marketing Data Analyst for SPINS. SPINS also advises retailers that educating yourself and customers is essential. Shoppers may understand what cognitive health is, but educating them and helping them become aware of the wide variety of supplements, foods and beverages that support brain function and cognitive health will help determine their in-store experience, and purchasing decisions, said SPINS.
As of July 21, 2021, “mental complex” supplements experienced a 58% year-over-year growth rate on Amazon, according to ClearCut Analytics in a report in Whole Foods Magazine. Sales have been steadily increasing for these type of supplements since August 2019, and ClearCut Analytics noted that trends often emerge on Amazon before reaching Food/Drug/Mass (FDM). Formulations in capsules are leading sales of mental complex supplements – capsules hold a 71% market share on Amazon, ClearCut Analytics reports.
Today’s aging population is helping drive sales of nootropics by focusing increasingly on brain and mental health, said ClearCut Analytics. SPINS also noted the COVID-19 pandemic has increased overall consumer interest in products for cognitive health.
Natural Products Industry Prepares for a Post-COVID Future
By Steven Hoffman
This article originally appeared in New Hope Network’s IdeaXchange and Presence Marketing’s May 2020 newsletter edition.
As the nation continued to battle the COVID-19 pandemic in April, with confirmed cases in the U.S. reaching 1 million and deaths from the disease surpassing 55,000 (more than the total number of U.S. casualties in the Vietnam War), the natural products industry, along with the mainstream food industry, found itself firmly on the frontline of the coronavirus crisis. In helping to keep food on America’s table during an unprecedented time of turmoil, sadly, this came not without some illness and casualties of its own among workers in natural foods stores and in mainstream groceries.
The month also saw farmers dumping tons of eggs, milk and fresh produce bound for restaurants, hotels, schools and other food service operations that were shuttered – product that couldn’t be re-routed – while frustratingly, grocers across the country were still struggling to keep product on the shelf as supply chains were further strained. Food banks, too, experienced long lines and shortages of staple products due in part to the demands of a record 26.5 million Americans who have filed for unemployment since mid-March.
Yet, among a bunch of bad news, retailers, distributors, manufacturers and others in the natural foods industry continued to pivot and do everything they could to serve and protect customers, minimize risk to workers, ensure inventory and respond to ever-evolving local, state and federal guidelines and shelter-in-place rules.
First, in response to a worrying number of employee illnesses, many grocers are now requiring that all workers wear face masks, though they, too, are having to compete with the federal government, hospitals and others to procure scarce Personal Protective Equipment (PPE). In addition, the United Food and Commercial Workers International Union (UFCW) along with Kroger, Stop & Shop and others, issued a joint statement on April 27 calling on federal and state governments to designate grocery store employees as “extended first responders” or “emergency personnel.”
“We are urgently requesting our nation’s state and federal leaders temporarily designate these workers as first responders or emergency personnel,” the joint statement said. “This critical status would help ensure our essential grocery workers have priority access to testing, emergency childcare, and other protections to keep themselves and their families safe and healthy. For the sake of workers, their families, and our nation’s food supply, this action will provide grocery workers with the vital protections they deserve.”
Responding swiftly to the lack of PPE for natural foods employees, Presence Marketing worked with one of its brand partners to manufacture face masks and other protective gear to provide to industry partners in manufacturing, distribution and in stores, “plus we’re working on a retail pack for consumers,” said Christine Tzumas, COO of Presence Marketing. “Our field team has been on the front lines from the beginning of this crisis working fast and furious to serve our customers in any possible way, from helping unload trucks when they show up at the dock to lending a hand stocking store shelves,” she said.
“The biggest thing for us right now is communication – we’re communicating everything going on as quickly as possible,” Tzumas continued. “Our brand partners have been receiving weekly, fact-driven COVID-19 updates, and the response has been so positive that we want to continue it in some fashion. While we’ve been dealing with this crisis, we still can’t lose sight of what’s on the other side and what the world will look like six months out from now. Hopefully, we will be moving beyond this. Our team has blown me away every day making sure to get food on the shelves – we’re blessed to be with the people and companies we work with. You don’t hear those same stories in other industries,” Tzumas added.
Phases of a Crisis
According to natural products market research firm SPINS, we’ve seen three distinct phases in terms of consumer shopping behavior since the coronavirus crisis hit the U.S. in late February. Also, with restaurants and other out-of-home dining options accountable for roughly half of all food expenditures, with their abrupt closure, demand doubled overnight for the nation’s grocers.
By late February, consumers who had an early read on the coming pandemic were responsible for big upticks in sales of preventive care products in natural foods channels, including vitamins, dietary supplements, probiotics, and herbal and homeopathic products. This was what SPINS refers to as Phase One: Proactive Self Care and Wellbeing, according to Kathryn Peters, EVP of Business Development for SPINS, in an April 21 webinar presented by New Hope Network.
“During the weeks of February 16 and 23, when there was still just a small number of confirmed COVID cases in the U.S. and the problems in China still seemed a bit far away, there was an early band of proactive shoppers beginning to stock up in key immunity-related categories beyond the regular cold and flu season type of products. That was when self-care items also started to pop, such as hand wipes and sanitizer. By late February, people were beginning to have a hard time finding hand sanitizer in stores,” she observed.
To provide some perspective, when Phase One began, “from just the previous week, we saw some extraordinary increases in a number of areas for the week ending February 23,” Peters said, noting a 1,285% increase sales of vitamins and supplements and a 211% increase in herbal and homeopathic products sales.
“We all know what Phase Two looked like – during the weeks of March 15 and March 22 – this was the mass stock up,” Peters continued. “During this ‘Pantry Prep & Loading’ phase, virtually everything sold.” Peters noted that during this period, 15 million additional buyers bought natural products. “That is a substantial number of products being bought by shoppers that are now in pantries. Time will tell if they will become continued shoppers; hopefully, there’s been a lot of trial,” she said.
April began Phase Three: Quarantine, according to SPINS data, with upticks in sales of baking mixes, pastas and spa-related items as Americans hunkered down at home and did their best to cook for their families, and pamper themselves while not being allowed to visit salons, massage therapists or other service providers. “Households seem to be bonding over baking, whether it’s bread or desserts – Instagram is full of proud creations,” Peters said.
The New Normal
“And then there’s Phase Four – what life is going to look like on the other side,” Peters said, noting that there will be some lasting shifts in consumer behavior in the “new normal” once the health crisis subsides. With consumers homebound, re-connecting with cooking and seeking more prepared food options, grocers are being presented with an opportunity to capitalize on providing mealtime solutions – something they were having difficulty with before.
Organic produce, too, experienced a resurgence, recording a 22% sales jump in March and an 8% increase overall for the first quarter, outperforming conventional produce sales, according to the 2020 Q1 Organic Produce Performance Report published by the Organic Produce Network and Category Partners. Growth may have been even higher, but was tempered by widespread out of stock conditions during the panic buying period in mid-March. “Organic fresh produce sales in the first quarter were strong, and the impact of COVID-19 in March pushed numbers even more,” Matt Seeley, CEO of the Organic Produce Network, said. “We continue to see organic fresh produce sales outpace the dollar and volume growth rate of conventional fresh produce.”
Another lasting trend will be a continued focus on proactive self-care and personal safety – immunity supplements cleaners, wipes, masks and other related household items will continue at a high level. Also, “while comfort foods are important, we are seeing growing recognition of healthy and nutrient dense food, too. This comes with consumers’ increasing recognition that our body’s immune system is the best line of defense. Even with economic pressures, we see this continuing. We believe that this unfortunate health crisis will be a bright spot in continuing to bring health and wellness even more mainstream,” Peters of SPINS said.
“We are very concerned about those negatively economically impacted by the coronavirus crisis. If there’s one major tectonic shift, it is the march toward more and better value product offerings to lower barriers of entry from a pricing standpoint,” said Ben Nauman, Director of Purchasing for National Co+op Grocers (NCG). Nauman noted that sales in March for its retail members were up nearly 30% compared to March 2019 sales.
NCG has been helping its members coordinate distribution and supply chain issues, take advantage of government stimulus programs, and currently, it is reinvigorating a recession playbook created in 2008 to help members manage cash flow and liquidity during economic downturns. “We’re also beginning to explore what it looks like to retail in a more contactless way going forward,” Nauman added.
For Sprouts Farmers Markets, a publicly traded natural foods retailer with nearly 350 stores and 30,000 employees, “due to our brands and distributor partners, we are in good stock level considering how high our sales are, and our customers are recognizing how good we are about being in stock,” noted John Soukup, Senior Category Manager for Sprouts. The company recently expanded curbside pickup and Instacart service to all its stores. “In addition, we have been very proactive in implementing measures to help our employees feel as safe as possible,” he added, noting that all employees are required to wear masks and gloves chainwide, the stores have installed sneeze shields in all checkout lanes, and store hours have been reduced to allow for deep cleaning. In addition, “we’ve offered bonuses to our employees instead of hourly increases. However, our leadership is doing a good job in compensating – we’ve already given out two to three rounds of bonuses to the front line employees in the warehouse and in the stores,” he said.
Soukup also expressed concern about the manufacturing sector as the health crisis wears on. “We are starting to see SKU rationalization – vendors are having to prioritize what items they’re going to make. That’s going to ramp up over the next four to six weeks that could cause other out of stock issues,” he said. To help counter that, “we communicate daily with our distributors and just about weekly with our vendors. In this unprecedented time, our primary distributors, KeHE and UNFI, have done a phenomenal job. The broker community, too, including Presence Marketing, has done a great job for us in terms of serving as a liaison between the brands and what’s going on in the stores.” In times of crisis, “you understand who your partners are pretty quickly,” Soukup added.
Distributors See Fundamental Shift in Demand
At UNFI, one of the nation’s leading distributors of natural products, EVP of Supplier Services John Raiche has noted some big changes as a result of the pandemic. “The big difference between April and March is we’ve seen a fundamental shift in demand as students come home from college, people are staying home, and the food service expenditure is gone. The infrastructure was not designed to handle a sudden shift of that magnitude,” he said. While retailers are no longer placing such massive orders, there was a period of time at the end of March where on some evenings orders coming in were 400% of capacity, Raiche noted. UNFI, which also has placed a large focus on worker safety and incentives, hired more than 1,500 people since the beginning of March.
For Raiche, flexibility and communication are key right now. “We are trying to be as flexible and creative as possible with our suppliers on purchase orders, and we are trying to communicate with the industry and reach out to suppliers to share with them what we see, to offer to work with them, and to provide updates in terms of demand and opportunity,” he said.
“For the team here internally, from receivers and collectors to drivers and the supply management team, there’s a real sense of purpose. People are open to working longer hours and doing whatever is needed. We’re spending a tremendous amount of time thinking about what the future holds, Raiche shared. “When it started, many people were thinking it would be like a light switch. Everything I read is that any transition back to normalcy will take place over a good amount of time. For our manufacturers, this demand is not going to go back to the old normal anytime soon.”
At KeHE Distributors, “our first priority is the safety of warehouse associates, professional drivers and in-store sales reps – the ones that are so important, the critical essential workers in this situation, said Scott Weber, EVP of Merchandising. “Our second priority is servicing retailers and suppliers to try to keep up with unprecedented demand. We’ve developed partnerships with food service distributors to align all our capacity to meet the massive demand in our industry. The third priority is giving back. Through our KeHE Cares philanthropic program, we are supporting those most affected by the COVID crisis.”
Weber added that while it may be a difficult time to introduce new products, “our overall category management and merchandising team remains heavily focused on innovation because we know that when those retailers get back to new items and category reviews, we’ve got to have a robust line to offer.” As such, KeHE revamped a “Trend Finder” event, originally scheduled for Natural Products Expo West, into a virtual event in order to meet with new suppliers. “The most important thing right now is working with our suppliers to ensure we have the flow of inbound product to KeHE that enables us to serve our customers,” he said.
Blair Kellison, CEO of Traditional Medicinals, a pioneering manufacturer of natural and organic teas, remarked that sales of tea in grocery was up 41% in the last month – “unheard of!” he exclaimed. Kellison often comes to work at 6:00 am to stand in the parking lot “just so I can say thank you to our workers,” he said. “If the workers are coming here every day, I should be here every day. These 120 workers are keeping our entire company going.”
Natural Products Sales Outpace Conventional
Photo: SPINS
Originally Appeared in Presence Marketing News, October 2019
By Steven Hoffman
If you look at the state of the natural and organic products industry, says market research leader SPINS, one of the primary takeaways is this: “The 5% sales growth rate for natural food and beverages over the year ending May 19, 2019, was nearly three times greater than for the overall food and beverage industry—continuing a now-longstanding trend,” reported New Hope Network. “Natural products have been outpacing their conventional counterparts for some time in terms of dollar growth,” said Jessica Hochman, SPINS senior manager of natural insights and innovation research and the lead author of the State of the Natural Industry report in a webinar presenting results from the study. According to SPINS, natural and organic products sales totaled $47.2 billion over the 12-month period and accounted for 10.5% of the overall $448.2 billion food and beverage market. In addition, natural products sales accounted for 29.3% of all food and beverage industry sales growth, says SPINS. In the convenience store channel, while natural products accounted for only 4.6% of total C-store sales, growth of these products over the one-year period was 12.6%, due to rising consumer demand for convenience and natural snacking. The data, presented as part of the Good Food insights series in collaboration with FamilyFarmed’s Good Food Accelerator and Naturally Chicago, Esca Bona and SPINS, will be highlighted on October 7 at Naturally Chicago’s Quarterly Keynote Event in Chicago. Presence Marketing / Dynamic Presence is a Sponsoring supporter of Naturally Chicago.