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New Global Briefing: Vitamins and Dietary Supplements (VDS) – Trends and Prospects

April 6th, 2017

Trends toward a healthy lifestyle and prevention among consumers aiming to avoid expensive healthcare costs and extend healthy life span are generating growth opportunities and challenges for VDS firms. Companies are adjusting to a new connected and more informed consumer who is starting to demand clean label VDS, while regulatory limitations around health claims and ingredients are becoming more strict. Retailers, manufacturers and ingredient suppliers are benefiting from the popularity of wellness to drive growth and create more diverse and healthier portfolios to match this new scenario.

This global briefing explores the global and regional trends and developments in the VDS industry from 2011-2016 and the dynamics that will influence these products in the near future.

Summary of Key Findings

trends toward healthy lifestyles and prevention support vitamins and dietary supplements growth; a new connected and more informed consumer is challenging the vds industry; globally, regulations around health claims and ingredient quality are becoming stricter; major retailers and manufacturers are being challenged by startups and online growth; customisation and technology bring new opportunities.

This global analysis offers a comprehensive view on the following topics:

  1. Global forces influencing vitamins and dietary supplements: VDS consumption has increased due to a variety of factors incentivising prevention, including global movement away from hospitalisation and the search for more affordable healthcare services to a growing ageing population. Regulatory agencies are paying more attention to health claims and it is expected the industry is becoming more regulated. Within sales channels, while e-commerce sales are growing at double digits in many markets, health stores and drug stores are developing wellness spaces and health-monitoring kiosks. Meanwhile technology is influencing the whole VDS industry due to developments in medical devices, personalized VDS, mHealth Apps, AI and an empowered mConsumer (mobile consumer) who is more informed by the internet.
  1. Global trends: Within the VDS industry, dietary supplements still lead but paediatric VDS paces growth. Even though OTC products still have the largest value share of global consumer health, VDS is leading growth between 2011 and 2016, with the US, China and Japan representing the world’s largest VDS markets. Paediatric VDS showed the fastest growth in the period and almost 50% of this growth is due to strong sales in China, where the expansion of a new middle class with rising disposable incomes and increased concerns about food safety all influenced parents’ purchasing habits.
  1. Regional overview: Asia Pacific and North America account for almost 80% of global VDS value. Growth in Asia Pacific is driven by the rising middle class with increasing purchasing power, who are more educated and concerned about maintaining a healthy lifestyle throughout their entire life. In North America, one key product influencing growth is probiotic supplements, which is increasingly positioned as beneficial not only for digestion but also for immunity, healthy ageing and other conditions, allowing for broader use scenarios for prevention. Another interesting market outside of the two leading regions is the Middle East and Africa which is projected to grow at the fastest pace over 2016-2021.
  1. Innovation insights: The VDS industry has seen trends emerge around whole foods and non-GMO ingredients along with interactive packaging. Pill fatigue and a need for convenience are pushing the VDS industry to increase options that are more snack-like, personalised and easier to swallow. Drink shots, sticks and pouches are generating more interest from consumers, especially among Millennials, along with the rise of membership programs that offer monthly delivery and access to a health and wellness team.
  1. Beyond 2017 expectations: A holistic wellness approach to health and prevention will continue to encourage consumers to purchase VDS over the forecast period. However, access to more information and constant connectivity is changing both the way consumers purchase and what they demand, especially among Millennials. Their search for healthier (ie clean label) and more “snack like” and customized products, in tandem with the rise of online sales, is causing strategy disruption in the VDS industry. Furthermore, stricter regulatory agencies could further impact health claims by demanding pharma-like evaluations to back them up or improving ingredient traceability and transparency. While this could challenge the industry, it could also increase consumer trust.
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