The year 2015 had every reason to be a rough stretch for herbs and botanicals. Yet, almost 13 months after a damning New York attorney general investigation, category sales tell a story of resilience, if not outright robustness. The category, in fact, saw 7.7 percent growth in 2015, above overall supplement growth of 6.2 percent (and well above 2.4 percent overall US GDP growth).
Herbals showed strongest growth in the natural and specialty channel, currently projected at 9.5 percent compared to 7.9 percent for mass market. Not surprising, it would seem, given both the maturity of the category’s home in natural and mass retail's position squarely at the center of the NYAG investigation. But a closer look at the numbers show greater complexity.
In fact, when looking at growth percentages of herbal formulas, mass retail dominates with initial estimates of 27.6 percent growth—more than twice the 13.4 percent seen in natural. SPINS data show herbal formula increases at 22.2 percent, led largely by mass market sales of products targeting allergy, brain health, children and cleansing, each growing more than 20 percent. The natural and specialty channel shows relatively modest increases with allergy and immunity topping the category at roughly 15 percent. Herbal formulas account for nearly $1 billion in sales in the overall retail space compared to nearly $2.7 billion for single herbs.
Herbal formulas tend to focus on condition-specific marketing, so this growth trend may suggest such products are selling at the expense of OTC pharmaceuticals. A June 2015 NBJ survey would support this: responses from general consumers showed higher trust in supplements than in OTCs.
On the sobering side are the IRI data showing 34 herbal products in decline against only 13 increases. On volume, however, the growth of the few outshine the declines of the many resulting in the strong overall growth. Perhaps there really is no such thing as bad publicity.