Xi’an Linhe Biotechnology Co.,Ltd.
The Dietary Supplements Industry In 2021: Where Will Physical Retail Go?

The Dietary Supplements Industry In 2021: Where Will Physical Retail Go?

Organic Freeze Dried Fruits And Vegetables


The COVID-19 pandemic has caused consumers to avoid public places, including supermarkets and stores while stimulating demand for health products such as dietary supplements. So how should physical retail in the dietary supplement industry respond to COVID-19?


Today, we jointly focus on the physical retail development of dietary nutritional supplements in 2021. Hope this article can bring some inspiration and help for relevant industry personage and readers.


Brick-and-mortar stores struggling to stay afloat?


Looking at the objective data, health and wellness retailers with strong e-commerce operations have performed well during the COVID-19 pandemic, as one would expect. But does that mean physical stores -- from natural food stores to big pharmacy chains -- are struggling to stay afloat?


Not necessarily. After all, as anyone who visited the nearby supermarket in the early days of the lockdown knew, it was a good place to shop for stock food.


Given consumers' growing interest in buying health products, health-oriented retailers may have a unique advantage in the Novel Coronavirus era. But challenges for physical retail will remain, even after Novel Coronavirus disappears. We spoke with several industry observers to get their thoughts on the physical retail development of the dietary supplements industry in 2021.


Repeatedly battle


Let's start with the good news. As Lisa C. Buono, head of IRI's healthcare practice, puts it, IRI has seen "a real outbreak of supplements" in all kinds of stores: traditional food stores, pharmacies, mass stores." In all my years working in the over-the-counter and supplement field, I have never seen sales growth as strong as this pandemic."2021 will be Lisa's 40th year working in this field.


SPINS Media LLC retail business consultant Jeffrey Crumpton agrees, noting that the retail channels he and SPINS focus on show similar trends. According to SPINS data, growth in overall physical sales of natural foods, dietary supplements, and health-and-wellness products peaked in March 2020, with sales of all products up approximately 12% in the United States in the four weeks ended October 4, 2020, Sales of natural products across all channels rose 14%.


Sales at retailers focused on natural products also peaked in March, with a growth of 11 percent in the four weeks ended October 4, 2020, in line with total channel growth, Crumpton said. Within SPINS 'proprietary channels, local grocery stores saw the strongest growth, growing 16% over the same time period.


But not every brick-and-mortar retail sector is enjoying the COVID-19 buzz."Health and vitamin stores saw the sharpest drop in growth in the first few weeks of 2021," Crumpton said. "However, they are now slowly recovering from their steep declines earlier in the year."Still, sales at such stores for the four weeks ended Oct. 4, 2020, were down 9 percent from a year earlier.


Give consumers what they want


In any case, Buono says the question on everyone's mind right now is whether the growth can be sustained. While she expects sales to remain strong, "once you compare them to mid-March last year, it's hard to believe the industry can continue to grow at this pace."


She noted that even if sales had slowed compared to the pandemic, it would have taken about three years for the market to reach its current level without COVID-19, based on previous annual growth rates of about 8 percent at most.


The question on everyone's mind is: How did retailers manage such growth when consumers were fearful, shopping constrained and a recession was looming?


In short, Buono says, they are giving consumers what they want.


"We are seeing a greater emphasis on supplements from our traditional retailers to meet consumer demand for products that support immune health," she noted. Results: Vitamin C and D, zinc and elderberry supplements were the "main beneficiaries" of the pandemic. Buono also found that retailers are devoting more space to such products on shelves and at the end.


But much of the advantage of physical stores comes down to consumer choice, and consumers have not yet fully transitioned to online shopping or contactless delivery.


In fact, Buono believes that stores of all kinds have benefited from foot traffic during the pandemic, simply because they offer consumers a one-stop option where they can shop for everyday items, personal care, and supplements all at once. One in, one out, and we're done.


Safety first.


It's an attractive proposition for consumers who don't want to spend too much time in public places. It also helps explain why retailers who do everything in their power to make the shopping environment safe enjoy continued patronage.


As for what "doing their best" means, Buono points to policies such as providing free disinfectant wipes and disinfectants, requiring social distancing and wearing masks, one-way traffic control in aisles, regular sanitization of cash register counters, and drive-in pickup services in parking lots.


Crumpton agreed that consumers will "lean toward the retailer they like, but only if that retailer has the appropriate security measures in place." If retailers fail to act, he said, "consumers have proven willing to change their shopping preferences and choose retailers who are willing to act."


So, he concluded, "safety is the most important consideration here." His advice for brick-and-mortar stores: Retailers should actively advertise their efforts to keep shoppers and employees safe.


Freeze Dried Foods And Dietary Supplements


Transformational change


But amid all the positive news, there is one fact that should not be overlooked: While physical stores have seen a surge in sales of healthy products, the pandemic has also boosted online sales of such products. According to SPINS data, Internet sales rose a full 80% in the four weeks ending in SPINS.


The reason is simple.


In the early days of the pandemic, fears of being infected by viruses in crowded stores and store shortages prompted consumers to switch to their laptops and smartphones. While learning to shop for health products online is a new experience for some consumers, especially those new to online shopping, "many are enjoying and are likely to continue to shop this way, at least to some extent."Buono prophesies.


But Buono also points out that hidden in the impressive online sales data is the fact that most online spending is spent on repurchases, not discovering new products.Here, she said, "physical stores are still the best place to provide a shopping and browsing experience." Of course, online portals can use artificial intelligence and product filters to help consumers find new favorites, but, Says Buono, "it can be a little difficult."


That's why we advise retailers and manufacturers to do both offline and online sales, Buono said. She acknowledged that selling on both platforms is "easier said than done," but that major brick-and-mortar brands like Walmart and Costco are competing with Amazon.


Crumpton has also seen "physical stores with strong digital presence outperform stores that are slow to change."


As far as he is concerned, online shopping offers benefits to everyone. As mentioned earlier, retailers can use data to target products to individual shoppers online, and shoppers themselves "can easily determine which products match their dietary, health, and wellness preferences." Crumpton said.


Satisfying these preferences is now more important than ever. Crumpton concluded, "During this period, awareness of health has increased, and the ability to help consumers quickly sift through products that meet their standards has given retailers a leg up on the competition."


The road to the future


So where does this leave retailers of healthy nutrition?

Crumpton emphasized that younger shoppers will be leading the online shopping wave compared to older shoppers, saying, "When things stabilize, older shoppers will be more likely to start buying products in stores again."


In addition, brick-and-mortar stores that combine online shopping, delivery services and curbside pickup will be more attractive to consumers, even if they spend the entire trip in a parking lot.


So while the pandemic has given a big boost to online shopping, SPINS 'recent survey team data still shows that the percentage of people who switch to online shopping "fluctuates," Crumpton said: "Many consumers will end up returning to physical stores once things get under control."


In fact, Buono suggested that brick-and-mortar stores take advantage of vaccine distribution opportunities -- once for the first shot and once for a booster shot." Smart retailers are stepping up their efforts and merchandising in those aisles that are most likely to attract traffic," she said.


"Understand your customers, too," she continued. The first vaccinations will be for the elderly, but younger consumers will visit when the shots are available to the general population." Younger consumers tend to want different things, especially in the supplement space."It is therefore simple and smart marketing to place products that consumers need before and after vaccination stations, such as formulas that support immune health, sleep AIDS, and self-care AIDS. This applies whether you are marketing in real life or on the Internet.