by Matt Weik
In a recent interview, Rich Gaspari told Generation Iron that he believes the quality of supplements is deteriorating because the market is over-saturated. It is interesting to hear that this comes from Rich Gaspari, who owns Gaspari Nutrition, because I said that a long time ago. Not only does the quality of the dietary supplements decrease overall, but also the margins for everyone involved.
Everyone starts a supplement brand these days
Not to throw anyone under the bus, but even Rich Gaspari mentioned that influencers these days use their social media muscles to play and sell their own line of supplements. Are these supplements generally of the highest quality? No, but it's about how much influence they have and how they turn their millions of loyal followers into customers.
If Kim Kardashian released a supplement line, people would buy their products. It doesn't even have to be a high quality product, since most people who would buy their product are unlikely to know anything about ingredients or even dietary supplements in general, but trust the influence of someone like Kim K.
Rich Gaspari mentioned that while many influencers could get some nice royalties or even a paycheck for being sponsored by a supplement brand, they rely on the fact that they have an exponential number of followers towards them are more loyal than any other supplement brand. Therefore, it only makes sense for them to start their own line of nutritional supplements. The same applies to celebrities.
The disadvantage of this oversaturation and where I agree with Rich Gaspari is that many brands dust their products with fairies and hide their deception behind proprietary blends. By the way, I'm actually FOR proprietary blends. I think they stop oversaturation in the market because people who have some money in their pockets just go out and cut a brand by using the same ingredients in the same dosages and then valuing the product lower than their competition and giving more money to market the other brand.
I think if a brand wants to stand out, they should consider examining some of the patented ingredients on the market that are scrutinized in a sense that they are subject to a higher standard than a generic ingredient.
A race down?
As much as I disagree with such a practice because it hurts the industry as a whole, there seems to be a price war between some brands, and this leads to a "race to the bottom" effect that (in my opinion) will lead to it that many brands give up their business.
If Product A is a pre-workout and is on the shelf for $ 21.99, the manufacturer of Product B will lower the retail price so that it is on the shelf for $ 19.99. This goes back and forth until neither of the two supplement brands makes money with the product.
Sure, some brands use a product as a “lost leader,” where they are willing to make very small margins on a product, just to tempt them to test or to get people to buy some of their other products while shopping (both in the stationary and in the stationary area) as on different e-commerce websites).
If you don't concentrate online, you will slowly bleed and die
I think it's fair to say that if people were going to die, they wanted it to be quick, so it's over and over instead of suffering a slow death and dying. The business is the same. Rich Gaspari went through some tough times a few years ago before he had to sell his company to Jared Wheat from Hi-Tech Pharmaceuticals.
Now I don't know all the details about why Gaspari Nutrition failed and why he decided to sell the business to Jared, but after Rich Gaspari regained control of Hi-Tech Pharmaceuticals a few years later, he now has a big focus Online growth.
In the interview, however, Rich Gaspari mentioned that he does not want to give up his brick-and-mortar business. I have to agree with him that bricks and mortar are not completely dead, but in the next breath you have to understand the direction in which things are going.
Everyone is shopping online these days. If they can get an Amazon product for less than what it is in a physical store and don't need to go to the store to get it, customers order online all day. It is practical. As a society, we get lazier every day and it changes our buying decisions and behaviors. If you want to grow, you have to search online.
Marketing strategies have to change
If you've been around long enough, you've seen all of the Gaspari Nutrition ads in the fitness and bodybuilding magazines. In fact, I work with some of the people who worked for Rich Gaspari and I am good friends with them. They now have their own company and work with different brands to help their customers grow their business through product innovation and new age marketing strategies. I am lucky to be used as a copywriter on many projects.
But overall the game changes and you either evolve or die. Many initially ride the "Transparent Label" train so they can try to distinguish their brand from everyone else, but I think this will go away soon when their products are discarded and they resort to proprietary blends to protect them intellectual property. I mean, why should you spend all this time, money, and resources developing a product to give everyone the "recipe"?
I believe that the supplement industry as a whole will come to a crossroads where it will be forced to make changes. In my opinion, the current development is not the direction that offers brands the greatest growth potential. The big brands need to keep pushing to eliminate some of these smaller brands that want to steal their market share. Likewise, smaller brands have to think outside the box to harm the big dogs out there.
It will be interesting to see where the supplement industry will be in 5-10 years. Who will still be in the game? Will Rich Gaspari still knock on retailers' doors, or will his model switch to e-commerce? Will the brand last long enough to see another 5-10 years? I don't think anyone in the industry is safe right now. Everyone is vulnerable, and if you get complacent, someone will take the kill shot to end your business.