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COVID-19 impacted sports nutrition sales, but dietary supplement industry players highlight bright spots and long-term opportunities.
In the early weeks of 2020, one could have done worse than to be in the sports nutrition sector. According to data provided by Euromonitor, the category’s domestic value had grown 63% from 2014 to 2019—10% compounded annually—topping out at U.S. sales of roughly $13.1 billion. And to all appearances, says Maggie McNamara, marketing director, Gencor Pacific (Irvine, CA), prospects for growth looked good.
“Increased demand for protein bars, supplements, and energy drinks among athletes, bodybuilders, and even weekend warriors was one of the major factors in that growth,” she adds, pointing to findings from Grand View Research1 that rising disposable incomes, urbanization, and the sheer building boom in gyms and fitness centers gave further cause to be bullish on the category.
“So needless to say,” McNamara concludes, “we expected sales to surge over the next few years.”
Then COVID-19 hit, and those expectations went out the window.
But new expectations are taking their place, and the pandemic may even lift some corners of the category, both now and in the long term. So industry insiders are keeping their eyes on the sector, and their fingers crossed.
Brian Appell, director, global communications, OmniActive Health Technologies (Morristown, NJ), also saw a bright future for sports nutrition as the year began.
“When you account for all the categories that have been subsumed into sports nutrition,” he says, “it’s a huge market. Diversification into weight management, athletic performance, energy, and even cognitive performance has transformed it from a niche category targeting gym goers to a broader consumer base looking to fuel their active lifestyles. And that’s a good thing; it’s built a strong category.”
But despite all that strength, sports nutrition couldn’t escape the disruptions that COVID-19 wrought in how consumers find, buy, and use the category’s products.
“Behavior has been so broadly affected by COVID-19 that the long-term effects aren’t yet known,” McNamara notes, “but there have been several immediate impacts.”
First, she says, fitness-center closures dampened demand both by cutting off a key purchase venue and “because people aren’t doing the same intense workouts at home that they were doing when working out at their local gyms or with trainers and coaches.”
Appell also noticed shifts in post-lockdown behavior that affected the market. “People simply weren’t exercising as much,” he says, “or they reprioritized spending toward keeping their pantries stocked.” And with more people at home than on the go, he adds, demand for convenience SKUs like bars and RTD beverages also fell.
The Bright Sides
“It’s not all bad news, though,” Appell continues.
For one, while the pandemic depressed sales of pre- and post-workout formulas targeting gym goers, upticks in sales of weight-management and protein formulations have helped stabilize the category, he says.
For another, Appell and other sector watchers can’t emphasize enough the support that online sales have lent sports nutrition, not to mention the industry overall. As he says, “It’s a sure bet that e-commerce will be a main focus for sports nutrition marketers going forward.”
McNamara agrees. “Consumers have had much more time to research products and shop online for everything from groceries to supplements amidst COVID-19,” she says. Citing a data from Nutrition Business Journal's "2020 Supplement Business Report,"2 she notes that online supplement sales are set to grow a stunning 61.4% in 2020. “Even more notable,” she says, “online sales are projected to grow from $5 billion in 2019 to more than $10 billion in 2022, potentially representing 19.6% of all supplement sales by 2023.”
And as for a third upside, COVID-19 appears to have renewed—or even awakened for the first time—a sense of urgency in consumers of all stripes to shore up their health however they can, including via diet, exercise, and supplementation.
“As a result of the coronavirus outbreak,” notes Floris Daamen, marketing manager, performance nutrition, FrieslandCampina Ingredients (Amersfoort, The Netherlands), “people are increasingly interested in looking after their health. In fact, according to our research, six in 10 consumers across the globe say they’re more conscious about their overall health and wellbeing because of the outbreak.”
Nutrition, activity, and quality of life are part and parcel of that new approach, Daamen adds. “That’s why their fitness habits are changing as they discover new ways to enjoy exercise, such as going for long runs,” he notes. “So I believe that one of the key lasting effects of this virus will be people’s acknowledgment that all aspects of health, both mental and physical, are interlinked.”
Upping Their Game
Sports nutrition brands hoping to thrive post-pandemic will have to both acknowledge that new reality and formulate to address it. Fortunately, Appell says, the category “has been evolving and moving in this direction anyway; the pandemic simply accelerated that change significantly.”
One way that McNamara thinks brands can adapt is by “exploring options with added supplement blends to extend positioning away from being solely about performance to including adjacent needs.”
We’ve already seen that manifest in formulations that nod toward consumers’ increased interest in immunity. “Even though it hasn’t been a cornerstone of sports nutrition,” Appell says, “companies are starting to pivot to including it as a benefit in their offerings.”
That’s in addition to other benefits that consumers seek, like weight and blood-sugar maintenance, adequate protein intake, and reduced inflammation, he says. “These all play well in this space, and formulators are starting to accent those benefits as part of their offerings, as well.”
Daamen thinks gut health might be “an exciting avenue” for sports nutrition formulators in the future. “Considering the research into the gut-muscle axis,” he says, “this will be an interesting development for sports nutrition, as current science suggests that as many as 30%-50% of athletes suffer from gastrointestinal problems that may impair their performance and/or recovery.” In addition to the Biotis Gut Health ingredient that FrieslandCampina launched earlier this year, the company aims to offer Biotis brand ingredients that target sleep, stress and immunity, Daamen says, “to deliver further on interconnected health concerns linked to the health of our gut and microbiome.”
Back to the Lab
McNamara sees R&D as key to ensuring that sports nutrition brands hit the ground running when “normal” demand returns. “During the crisis, many manufacturers have emphasized developing novel products based on customer personalization and customization, which are generating substantial growth prospects in the global market.”
For example, while CBD has attracted attention in the sports space—despite the potential for regulatory complications and what McNamara describes as a thin scientific record supporting its benefits—she offers palmitoylethanolamide (PEA) as a more comprehensively studied, and potentially more effective, alternative. She claims that PEA has the same effect as CBD on the endocannabinoid system, “which plays a role in fundamental physiological processes such as mood, pain, and recovery.” And multiple studies on Gencor’s branded PEA Levagen+ product show its effectiveness, particularly at managing discomfort and exercise recovery, she says.
Adds Daamen, “Brand owners can differentiate not only by adding health benefits to their products, but by clearly communicating them.” In the end, “Proactive education about different ingredients’ functional benefits is necessary to grab consumers’ attention and help sports nutrition brands extend into broader consumer bases,” he says. And just like an end of this pandemic, that’s something we can all look forward to.