Editorial: Universal Ingredient Issues

By Len Monheit

As I was preparing for a presentation on cosmeceutical ingredients, and doing the research required for this short talk, several aspects of the world of natural ingredients made themselves quickly apparent. I don’t mean to say that out of the blue I had one of those light bulb moments, what I mean is that previous general observations became crystal clear in new context.

The first issue that struck me was the issue of economics, quickly followed by ingredient supplier role and responsibility. A third issue was the universal challenge of differentiation, made more acute by questionable forays into both branding and channel strategy. A final issue was the observation that companies often venture into new business environments without understanding the landscape they are entering, sort of like diving into a lake from a cliff, without first investigating depth.

From the top – substantiated or not, one must recognize that economic drivers often impact the hype and awareness surrounding an ingredient. Sometimes it is as simple as the laws of supply and demand, when an ingredient becomes more available, obviously commoditization runs rampant and we see it touted for every concern and condition. Similarly, if innovation leads to a lower use cost or higher margin, the same occurs. Even for products with a high level of substantiation, it is probably justified for prospective buyers to be particularly aware of the economics concerning ingredients they are buying.

As far as role and responsibility is concerned, in the cosmeceutical sector, as in others, a significant portion of the educational function directed at consumers, necessarily falls on the ingredient side. It is the supplier responsibility to support the science and to a certain extent present it (or make it available for appropriate translation), while the manufacturer takes on the marketing function. The category building exercise therefore relies heavily on the investment made by he ingredient company.

As is the case in both dietary supplements as well as functional food and beverages, we can observe a mix of branding and differentiation strategies. Often though, these are erratic or even discontinued prematurely, before they can generate critical mass and market traction and sustainability. The supplier moves on to what’s next rather than supporting investments already made. And in a global environment, the inevitable clutter is also a concern, making differentiation a real concern, if not nearly impossible.

As to the final observation noted above, companies observe without seeing and participate without commitment. By this I mean that it is relatively easy to present a product to a market, but this activity stands a much higher chance of success if it presented with market knowledge and a certain degree of commitment and investment. Sometimes this involves event participation and involvement, sometimes advertising, but in many cases, the strategy needs to also involve due diligence, proper use of outside expertise, polling, test approaches and marketing, and patience.

It is quite standard to react to hype, buzz and dynamic successful markets and to want to participate. For those that want longevity in burgeoning marketplaces, the usual rules of business apply – do it right and do it for the long haul - by doing your homework.

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.