By Mike Montemarano, Associate Editor11.07.23
There has been an overall downturn in growth rates of dietary supplement sales. But there are growth areas to capitalize on—some expected and some surprising—according to data presented at SupplySide West by industry analysts Bill Giebler, content and insights director at Nutrition Business Journal (NBJ) and Erika Craft, industry analyst at Informa.
Sales Slumps
Sales of dietary supplements dipped to a 1.9% CAGR to reach $61 billion in 2022, which, adjusted for inflation, is negative growth. Still, the projected 2023 market size for dietary supplements is $1.5 billion higher than what NBJ expected prior to the outbreak of COVID-19, so the pandemic boost has yet to level out to pre-COVID forecasts, Giebler said.
There were some surprising slumps when it came to particular market segments.
E-commerce saw a major dip in sales growth to 5.7% as consumers return to brick and mortar. In 2020, e-commerce experienced a CAGR of around 90%, said Craft. “It was surprising how quickly that growth dropped off,” she said. “It’s still expected to stay in the 5-6% range, so that segment is still outperforming the market as a whole.”
The category of herbs and botanicals saw a surprising -2% decline in sales, dipping to a market size that was even below NBJ’s pre-COVID forecasts for this segment.
Growth Opportunities
Sports nutrition is a market still experiencing a boost as products continue to blur the lines between products for top-performing athletes and people who engage recreationally. The market segment is anticipated to grow at a CAGR of 7.6%, increasing by over $27 billion to reach an estimated $90.5 billion in 2026. Craft noted that in 2022, the entire dietary supplement market was valued at above $62 billion.
Mushrooms were hot in 2022 with an impressive 19% growth. NBJ anticipates this category will be six times greater in size in 2026 compared to its size in 2018, from $40 million to $240 million. For a glimpse at what’s driving this rapid growth, consumers surveyed by NBJ said last year they took mushroom supplements for general health (70%), immune health (64%), mood, stress, or mental health (54%), and brain health (45%).
Consumers were most likely to add mushrooms to protein shakes/snacks (49%) or smoothies (48%), take them in their morning coffee (48%), add them to savory meals (43%), take them in capsules or as a dietary supplement (40%), or drink them in pre-packaged teas or added to teas (38%).
Despite the downturn for herbs and botanicals, ashwagandha is expected to maintain its double-digit growth through 2023, Giebler said, though its CAGR is anticipated to level out at around 7.6% by 2026. But by improving consumer awareness, this trajectory could be even more positive. Just 40% of consumers told NBJ they had heard of and were familiar with ashwagandha, while the majority have either never heard of it (31%) or have heard of it but know nothing about it (29%).
When it comes to condition-specific markets, experiential conditions were top-of-mind for consumers surveyed, who actively were managing stress (17%), energy or lack of energy (17%), weight (16%), sleep/insomnia (16%), mood (15%), and cold/flu/immunity (14%).
While mood and mental health supplements saw a harsh downturn from a CAGR of 31% in 2020 to negative growth in 2022, it has already rebounded and will likely grow at a CAGR of 3.8% by 2026.
Women’s health products have a good outlook, and are expected to experience a CAGR of 2.2% through 2026, adding $215 million to the market, led in large part by products marketed for menopause symptom relief, a subcategory expected to add $138 million in sales by 2026, rising at a CAGR of 5.3%. Product innovation, consumer awareness campaigns surrounding menopause, and an overall effort to destigmatize conversations about menopause and hormonal/vaginal health appear to be significant market drivers, Craft noted.
NBJ data suggest that consumers are trading down rather than giving up supplements completely. As a result, mass market sales are experiencing an uptick, with sales growth rising to 5.7%.
Of all channels, the healthcare practitioner (HCP) market is experiencing the highest growth rate at 7.6%, after a major dip in 2020. While the HCP market represents just 10% of the dietary supplements market as a whole, it’s worth keeping an eye on, Craft said.
Sales Slumps
Sales of dietary supplements dipped to a 1.9% CAGR to reach $61 billion in 2022, which, adjusted for inflation, is negative growth. Still, the projected 2023 market size for dietary supplements is $1.5 billion higher than what NBJ expected prior to the outbreak of COVID-19, so the pandemic boost has yet to level out to pre-COVID forecasts, Giebler said.
There were some surprising slumps when it came to particular market segments.
E-commerce saw a major dip in sales growth to 5.7% as consumers return to brick and mortar. In 2020, e-commerce experienced a CAGR of around 90%, said Craft. “It was surprising how quickly that growth dropped off,” she said. “It’s still expected to stay in the 5-6% range, so that segment is still outperforming the market as a whole.”
The category of herbs and botanicals saw a surprising -2% decline in sales, dipping to a market size that was even below NBJ’s pre-COVID forecasts for this segment.
Growth Opportunities
Sports nutrition is a market still experiencing a boost as products continue to blur the lines between products for top-performing athletes and people who engage recreationally. The market segment is anticipated to grow at a CAGR of 7.6%, increasing by over $27 billion to reach an estimated $90.5 billion in 2026. Craft noted that in 2022, the entire dietary supplement market was valued at above $62 billion.
Mushrooms were hot in 2022 with an impressive 19% growth. NBJ anticipates this category will be six times greater in size in 2026 compared to its size in 2018, from $40 million to $240 million. For a glimpse at what’s driving this rapid growth, consumers surveyed by NBJ said last year they took mushroom supplements for general health (70%), immune health (64%), mood, stress, or mental health (54%), and brain health (45%).
Consumers were most likely to add mushrooms to protein shakes/snacks (49%) or smoothies (48%), take them in their morning coffee (48%), add them to savory meals (43%), take them in capsules or as a dietary supplement (40%), or drink them in pre-packaged teas or added to teas (38%).
Despite the downturn for herbs and botanicals, ashwagandha is expected to maintain its double-digit growth through 2023, Giebler said, though its CAGR is anticipated to level out at around 7.6% by 2026. But by improving consumer awareness, this trajectory could be even more positive. Just 40% of consumers told NBJ they had heard of and were familiar with ashwagandha, while the majority have either never heard of it (31%) or have heard of it but know nothing about it (29%).
When it comes to condition-specific markets, experiential conditions were top-of-mind for consumers surveyed, who actively were managing stress (17%), energy or lack of energy (17%), weight (16%), sleep/insomnia (16%), mood (15%), and cold/flu/immunity (14%).
While mood and mental health supplements saw a harsh downturn from a CAGR of 31% in 2020 to negative growth in 2022, it has already rebounded and will likely grow at a CAGR of 3.8% by 2026.
Women’s health products have a good outlook, and are expected to experience a CAGR of 2.2% through 2026, adding $215 million to the market, led in large part by products marketed for menopause symptom relief, a subcategory expected to add $138 million in sales by 2026, rising at a CAGR of 5.3%. Product innovation, consumer awareness campaigns surrounding menopause, and an overall effort to destigmatize conversations about menopause and hormonal/vaginal health appear to be significant market drivers, Craft noted.
NBJ data suggest that consumers are trading down rather than giving up supplements completely. As a result, mass market sales are experiencing an uptick, with sales growth rising to 5.7%.
Of all channels, the healthcare practitioner (HCP) market is experiencing the highest growth rate at 7.6%, after a major dip in 2020. While the HCP market represents just 10% of the dietary supplements market as a whole, it’s worth keeping an eye on, Craft said.
