The natural-products industry is expanding rapidly, gaining consumer trust and capitalizing on shifts in how they lead lives their lives and what they expect from companies, according to a
“This industry is sizable now, we surpassed $200 billion in sales last year and on track to hit $300 billion in sales in 2022,” said Carlotta Mast, senior vice president for content and insights at Colorado-based New Hope Natural Media. She was speaking Jan. 31 at North Bay Business Journal's North Coast Specialty Food & Beverage Industry Conference.
She is the chief editor of the NEXT Natural Food Product Forecast and board president of Naturally Boulder, a 1,200-member trade group focusing on the natural products industry in Colorado. In 2013, she co-founded a “paleo” snack company called Wholly Bites. In 2016, Wholly Bites was sold to 1908 Brands in 2016.
Natural-products businesses make natural and organic food, “functional” foods and beverages, dietary supplements, natural and organic personal and health care products and pet products. The industry in 2007, when she joined New Hope, was just at $100 billion and has roughly doubled, despite a recession along the way.
“But this more than a growing industry, this a major tectonic shift…,” Mast said. “We are doing so much more than making money, we as an industry really changing the world. We are using business as a force for good … not only creating successful companies but working together to tackle really important issues, like climate change, like social injustice like life style related disease. I think is the most important part of our story and our legacy.”
She said this segment of the food and natural products industry continues to grow with sales from 2016 showing a 9 percent boost while the total food industry sales grew by less than half a percent in the same period. Though the sales are small compared to the $770 billion in sales for the overall industry, Mast contended the large companies continue to take notice.
“These top companies are feeling a lot of pain as a result of the consumer-driven changes that are happening in the market place,” Mast said. “And losing billions of dollars as a result. Those companies are rapidly trying to figure out what to do in this changing environment. They are acquiring the best of the natural and organic brands and in some cases trying to reinvent their own purpose and what they stand for. This is a Herculean challenge and nipping at their heels are all these challenger brands.”
As the industry grows, she said, it is also seeing some trends in the marketplace that are dictating what products are developed, how companies position themselves in that marketplace and even the culture of some companies.
For example,“Snackification” is a big market trend.
“Meal times are so different than they would have looked like maybe 10 or 20 years ago.” Consumers snack throughout the day, yet are “expecting snacks that have boosted nutrition….”
So beans get added to make “Go Dip” snack or crackers become “Rockin’ Reishi” because they are infused with reishi mushrooms. One producer is also marketing a “grass-fed collagen protein bar” to answer that need for a nutrient dense product.
And when or if some consumers do sit down for a meal, “forward-thinking” brands are catering to that convenience but nutritional demand, by supplying meal kits that are messaged in a socially responsible way. On the shelf examples include a “Love the Wild” fish kits or “Rebel Fish” which is a Thai chili microwaveable product.