Biggest Supplement Industry Trends in 2023
This is my fifth annual list of supplement industry trend predictions. Many of you know that I cut my teeth in the sports nutrition space…plus I’ve always believed the best and brightest companies in sports nutrition (active nutrition) are the influential epicenter for the entire CPG industry. So, there’s always an extra layer of self-generated pressure that I put on myself to come up with insightful and impactful trend predictions in this particular content piece. For those that are newer to my content, I only have one big rule for these annual trend prediction lists…
Rule #1 = I don’t allow carryover predictions from previous years.
This makes it more challenging, but also a little strange because trends are typically multiyear in nature…with the strongest ones lasting a decade or more. So, if you have some extra time and want to multiply your insights…I’d suggest checking out my previous annual supplement industry trend prediction content pieces. They’re still hugely relevant and packed with value.
2019 = https://youtu.be/vGBgyOrlXnY
2020 = https://youtu.be/F2eEJRkjhj8
2021 = https://youtu.be/P6igt_SM2UI
2022 = https://youtu.be/OF2PG6haSJ0
Which supplement industry trends do I predict will be the biggest in 2023? Let’s jump into this year’s list…
Trend #1 - Gut Performance
Yes, the rise in gut health has been going on for much of the last decade. Yes, the mainstreaming effect within the sports nutrition industry has also been going on for much of the last decade. Yet, I’m going to guess most users of sports nutrition products wouldn’t name gut health ingredients in their performance optimizing must haves. That starts to materially change in 2023, as both the supply side and sports nutrition brands work on drawing a straighter line between gut health ingredients and their ability to improve athletic performance and exercise endurance benefits.
Trend #2 - Load Up on OWYN
No…not that OWYN, but the acronym means the same thing (only what you need). I’m not going to be the guy that jinxes everything by saying the “R word”, but probabilities are high…and consumer behavior around it will matter a lot. Unless something takes a turn with Chinese public health, runaway inflation seems to be under control within the sports nutrition industry. Yet, prices should remain quite elevated throughout the year. So, those price elasticities of demand that looked slightly lower than estimates in 2022, could turn bad quickly if predicted macroeconomic job loss happens, eliminating the spending power for millions of Americans.
How does the supplement industry adapt?
On the consumer front, I see them being more cautious and seeking value. That could come from trade downs, but not within the typical consumer behavior of purchasing more private label products. Instead, I think consumers get selective on a “must have” versus “nice to have” product benefits. As an example, if you’re a pre-workout buyer and your normal product of choice has a stacked ingredient deck that provides both top-tier pump and energy, yet you only need the energy part…why pay for the unwanted benefits when times are tight? Additionally, you’ll see some consumers trading out of certain “nice to have” categories. While I think consumers will continue to invest in themselves…and those secondary/tertiary categories will be resilient, spending power will further shift towards the “must have” categories and product benefits.
On the brand side, I expect a few things to happen:
these stakeholders will ensure products are positioned not just as affordable but as essential for consumers
they will took to simplify product portfolios and double down on delivering quality over quantity in formulations
they will start offering more economical “bulk” options in their top-selling flavors of top-selling SKUs to help consumers save money
Trend #3 - Big Brick Poppin’
It wasn’t long ago that retail pundits were saying online spending would permanently leap ahead by 5 or even 10 years because of “COVID-19 Effect” tailwinds. There’s no doubt that ecommerce currently is and will continue to be an incredibly important sales channel for the caps, powders, and pills side of sports nutrition, but everyone got a little overzealous with the predicting the stickiness of these pandemic trends. That’s why you saw things flip back to normalcy in 2022, with SPINS data showing that brick and mortar was the dominate channel winning around 80% share of dollar sales and contribution to growth by the back-half of the year.
With that Big R word likely…this won’t be the easiest retail environment…regardless of offline or online, but here’s why I predict brick and mortar again wins the majority share of the dollar sales and contribution to growth in 2023.
Large retail channels…from grocery stores to mass retailers to convenience stores have drastically expanded the breadth and depth of sports and active nutrition merchandising over the last few years.
Not only have they done a great job with merchandising strategy, but large retailers have also started to rebrand themselves overall within the health and wellness halo. That might be offering on-site nutritionists or nurses, leveraging in-store testing, or just integrating technology layers in shopping apps to help make the shopping experience more valuable to those on a wellness journey.
Foot traffic won’t be as bad as everyone predicts, with the more value-orientated retail channels getting a boost. That’s great news for Walmart, Costco, but also dollar stores…all strong.
Consider what’s selling like crazy…performance energy drinks are hot. Sports/Hydration drinks are hot. Protein bars are roaring back with consumer mobility normalized and protein snacks will sustain importance at-home.
What’s that all point too? Large retail should again get the lion’s share of dollars.
Oh…and how does specialty retail do (e.g. GNC and The Vitamin Shoppe)? I predict the channel will be flat or maybe down a few points in 2023.
Trend #4 - Flex Your Brain
Not unlike the first trend prediction, you could be scratching your head thinking cognitive health has been a trending area for some time…especially the last few years, why are you mentioning it now? It comes down to being intentionally patient because I wanted to see if the condition-specific category would morph into something more relevant and actionable to the sports and active nutrition industry.
Here’s the deal…the decline in brain function is most often associated with the final third of your life. That means cognitive health usually gets overlooked by the average buyer of sports supplements. Well…that was until 2020 hit everyone like a freight train. Whether it was working from home while also balancing kids at-home or just battling against the mental barrage of a completely new day-to-day reality, it brought a lot of new first-time customers to cognitive health supplements.
That’s where we were…but where we’re going is away from reactive “triage-like” behaviors and more into proactive consumption. The cognitive health market now encompasses more young professionals, college students, gamers, and middle-aged adults, most of which are realistic about the tradeoffs required to live a high achieving life. If they want it all…from the continual quest for knowledge to the desire to stay at the top of their game in and outside the gym, it wont be without a higher-stressed emotional state. The constant distractions from 24/7 connectivity will have its negative consequences even if they aren’t in that last third of life. This will create major opportunities and drive the cognitive health market to new heights.
Trend #5 - Supplementing with Purpose
Maybe it’s the generational change finally making an impact in the space or maybe it’s because I just visited the HQ of 1st Phorm, but it’s time to talk about what I’ve dubbed “Supplementing with Purpose.” Although every generation’s attitudes evolve with age, today’s changing consumer values are contributing to some of the disruption that the sports and active nutrition industry is experiencing today. It is no longer enough to just sell sports supplements. That great product…it’s not enough. That excellent customer service…it’s valuable, but also not enough anymore. Those cool labels, charismatic influencers, whatever surface-level attribute…it’s not going to be enough.
Younger consumers have begun to perceive brands more like people rather than distant corporations…and are choosing to surround themselves with like-minded brands. Purpose-driven sports nutrition brands will begin dominating the conversation and successfully capitalizing on these changing values. I don’t think there’s a one-size-fits-all purpose-driven approach, so we will see progressive business models win, people-first initiatives win, and environmentally focused brands winning. Regardless, today’s sports nutrition brands cannot ignore these megatrends anymore and they should take advantage of opportunities to present themselves as a friend with a clear purpose and a story that transcends their products in the minds of consumers.