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Top takeaways from Natural Products Expo Asia 2012

Top takeaways from Natural Products Expo Asia 2012

Natural Products Expo Asia wrapped up two weeks ago in Hong Kong—I had the good fortune to attend—and I’ve spent the time since mulling over what makes that event unique from its U.S. counterparts.

Beyond the basic differences that it’s smaller, younger and often in a different language than Expos East and West, Expo Asia also revealed to me some interesting contrasts between consumer preferences in the United States and preferences in China and Hong Kong.

1. Dietary supplements are still a novel concept in East Asia.

We tend to think the concept of “natural health” originated in China. It’s almost as though the supplement industry stole that concept, packaged it in the cloak of Western medicine, and is now trying to sell that pharmaceuticalized version back to the Chinese people. As such, it’s a new, exciting market where education is a must.

2. North America is one of the few places in the world with natural food retailers.

Pharmacies, supermarkets and convenience stores tend to be the major channels of distribution for nutrition products in other regions, so the timbre of industry innovation is a bit different than in the United States.

As an aside, after Expo Asia, when I was in Japan to present for New Hope’s Market QuickStart program, one of our hosts said that the thing she liked best about America were its natural food stores—tiny food oases in the land that foisted McDonald’s on the rest of the world.

Honestly, it sparked a little bit of the jingo in me—a nugget of patriotism that the best and the worst of the world’s food system are housed right here between the redwood forests and the Gulf Stream waters.

But the natural channel is also essential to character of the U.S. nutrition market. In the States, innovation happens in the natural channel—it’s where supplement and food trends percolate and then bubble over into the mass market. That pipeline of development is less pronounced in other regions, and so these markets tend to look to the United States for the latest trends.

3. Organic is about status.

In China, getting organic certification is an opaque, labyrinthine process, and it is still very much a niche category. On the whole, I got the impression that naturalness is not a high priority for most Chinese consumers the way it is in the United States. For the Chinese, organic is more a symbol of status (something we’d very much like to believe is untrue about the U.S. market). Though it’s a health proposition, most organic products for sale in China or Hong Kong seem to be luxury items.

4. Trends aren’t all that different than in the United States.

Weight loss is big. Blood sugar management is on the rise. Joint health is important. Natural skincare is a win. I noticed a lot of bee products—propolis, manuka honey—which deserves a closer look because that seems to be a growing trend in the United States as well. I actually expected to see a lot more Traditional Chinese Medicine products, but now my impression is that that market operates in channels tangential to mainstream retail.

If you want some culture shock, it’s there. If you’re looking for placenta jelly, frog oil, freeze-dried antler blood, or essence of kangaroo, I know where you can find it. But, for the most part, the ingredients and products are equivalent to the ones you would find at Expo West. It’s just the audience that’s a bit different.

I think the biggest takeaway is that the Chinese and Hong Kong markets are very receptive to nutrition and natural products. Now is the time to make a move.

But the tenor of business and the channels of operation are different than in the United States, so it’s worth dedicating time, effort and staff in order to understand the market.

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