e-Commerce Innovations for Vitamins


The size of ecommerce market of vitamin and mineral and supplements (VMS) crossed $2 billion and surpassed Walmart’s vitamin sales of $1.7 billion in 2016. VMS retailers are keen developing e-commerce strategies and integrate with digital commerce platforms identifying high impact opportunities in building competitive advantage driving next level growth.

New age business models combined with e/m-commerce is empowering VMS industry get better access to consumers, exponentially improve customer experiences, prioritize and drive next-gen innovations improving the future success rates. As an enthusiast envisioning the success of vitamin & supplements e-commerce and know-how of recent developments, summarizing below few specific developments in this space.

  • Vitamins are going direct-to-consumer: As 2017 progresses, consumers are willing to spend more for items that contribute to notions of self-care and wellness. With that the vitamin and dietary supplement (VMS) market is on an upward trend, a crop of new direct-to-consumer (D2C) startups came up to capture that. D2C’s are hoping to shake up the category and appeal to consumers with transparency, simplicity and branding. Care/of and Ritual, two high-tech brands that are poised to become the Warby Parkers of the supplement world.
  • Focus on price-to-weight ratio attaining economic sustainability: As online channels ex; Amazon, surpassing the critical volumes of VMS supply, there is an increasing focus on consumer behavior of purchases of only a single SKU remedy or supplement that can present a price-to-weight challenge for the seller. For business sustenance, the profit margin on the purchased item must be greater than the shipping cost in order for the seller to make money. For example, in case of Amazon where per package shipping costs range from $4.00 to $6.00, the breakeven order price for the SKU must be at least $12.00 to $15.00 in order for the transaction to be profitable. This offer a leeway to both the OTC and vitamin/health categories as the single items often meet this type of price-to-weight requirement. When a customer buys a bottle of fish oil for $17.00 or an order of Mucinex for $23.00, the sales model is working and makes eCommerce model viable.
  • OTC extending to in-home with 3D printing: In recent times FDA has approved Spritam, an anti-seizure drug and the first 3D-printed pill. This will bring use of technology one step closer to change the way people are experiencing medicine. In the future, it may even be possible to print vitamin and supplement pills at home There are already a great number of startups focusing on personalizing healthcare (with the help of AI) and making it as easily accessible as possible- in your own home. So, if companies can look at this new channel as a potential source of revenue, it could probably disrupt OTC and healthcare itself. Augment it with telemedicine, and you really could even eliminate some/much of the retail pharmacies today, while really personalizing treatment.
  • AI and ML aided search algorithms are becoming backbone to Vitamin & supplement e-commerce success: If a remedy works for one person, it may work well for another. And vice versa. That’s why the importance of ratings and reviews may be more important in the OTC and vitamin/health categories than in any other category. A good product review is not only a persuasive endorsement that helps drive conversion, it’s also an important component in strengthening a brand’s search rankings. Hence search algorithm is not only powered by the number of reviews a product has, but also by the pace at which new reviews are being added. If a product has too few reviews or not enough positive reviews, people simply won’t buy.
  • Search is critical to success online/e-commerce channels: In gig economy to take full advantage of e-commerce, it is vital for vitamin/supplement suppliers to know precisely how people are searching for its products. What key words are they using? Are there search trends? What is the frequency of searches for “pain reliever” or “headache” or “migraine”? When suppliers are selling in-demand products, they’ve got to make sure their content is relevant to those searches, including product titles, description and bullets, that clearly communicates the benefits and features of what’s being sold. Advances of AI and Machine Learning are aiding to find the patterns and triggers of consumer purchases and behaviors.
  • Ecommerce combined with personalization will lead the vitamin / supplement market: The long-term winners in this space will leverage data and their knowledge of their consumers to proactively offer products that fit their customers’ health needs and provide a degree of personalization and intimacy that don’t exist yet on a broad scale. The levels of personalization will be necessary in upcoming fights against the biggest e-dog of all, Amazon, which also has access to an immense database of purchasing history that it can use to push personalized consumer health options. Amazon offers rush delivery for a variety of over-the-counter products and vitamins and dietary supplements through its Amazon Prime Now service that is operational in around 30 metropolitan areas. Earlier this year, Amazon also quietly expanded its private-label line Amazon Elements into a handful of clean-label vitamins and supplement categories, which perhaps is a signal of the company’s intent to fully jump into this space and opportunistically fill the potential void if GNC and the Vitamin Shoppe continue to decline. As more consumers each day are showing a declining link to physical stores, Amazon has the ability to step in and dominate the market for these products much in the way it has for so many other household staples.

Vitamin & supplements market will continue evolve leveraging e/m-commerce strategies. Constant innovations in this space are what we continue to explore into future. So VMS value chain partners have to collaborate co-innovating e/m-commerce models, offer value based services, identify future direction and collectively come up with a path to succeed.

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