Top Trends from Natural Products Expo East
We had a chance to check out Natural Products Expo East a few weeks ago. More than 23,000 retailers turned out for the largest natural products expo in Baltimore, MD. The Expo, brimming with over 1,200 exhibitors, featured some of the hottest trends in the food and beverage vertical such as: protein powder; probiotics; cold-pressed juices; clean, simple ingredients; and farm-to-face. Not surprising, we noticed an increase in the popularity of non-GMO products, and a thriving support sector with companies ready to certify products and bestow the coveted “non-GMO” designation.
By definition, the Expo was filled with organics and green products, however, an exciting emerging trend is the focus on disease prevention as a core product attribute. For example, MaeDay, a “tasty, clean” BBQ sauce, lists ingredients as “antioxidants.” All Beauty flavored waters promise to “hydrate and nourish your skin,” as well as quench your thirst.
Overall, the Expo was extremely upbeat, with many brands expressing optimism about expanding niche verticals. All of the brands we spoke to were focused on the same challenges: building an audience and building distribution. Here are our top four trends from Expo 2014.
Building an Audience
To accomplish the former, younger brands are turning to inexpensive social media. Brands offered prizes and incentives for customers to take pictures and tweet photos of themselves enjoying the product. Other brands used celebrity product placements to build awareness. All agreed that “Fulfilled by Amazon” was a necessary evil for launching a brand: most brands adopt a three pronged omni-channel strategy integrating direct to consumer for branding, Amazon for discovery, and wholesale for reach.
On the distribution side, the food and beverage industry remains regionalized. Rather than go it alone, many brands engage third party resellers to crack the most important national accounts: Whole Foods, Target, Safeway, and high-end specialty shops. Whole Foods continues to be the holy grail for most natural brands, despite continuous pressure to meet sales quotas. With so many brands eager for shelf space at Whole Foods, lackluster sales will quickly result in products and brands being discontinued.
Quality control for perishables remains a significant challenge for many brands, especially single or niche product businesses that manufacture and drop ship from the same facility. Brands expressed concerns about their products languishing in a hot warehouse or sitting for extended periods of time in a truck, so temperature controlled facilities are crucial – but cost more, and continue to put pressure on pricing and margins.
Legacy brands have been at this for years, but with the breakout success of products like Krave Jerky, brands are optimistic about the upside of cashing in on niche verticals. Beef jerky is a $4B category, and many artisanal beef jerky brands are eager to follow Krave’s success. Other categories like water and granola, which would normally be seen as a crowded space, are experiencing a similar renaissance with additional products and flavors creating a broader consumer market that benefits all players.
What trends and new products did you see at the Expo?
Photo courtesy Natural Products Expo East.View Author’s posts