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TABS: Brick-and-mortar still VMS king as e-commerce grows

New data from TABS Analytics has clocked the vitamins, mineral and supplement’s latest sales increased at $500 million, or 3% in the past year. The gains to the $14 billion market, driven by sales increases on and at Walmart stores, also were bolstered by gains in sales to occasional VMS consumers, according to the 11th Annual Vitamin Study.

Though e-commerce made gains, Walmart’s brick-and-mortar sales were in the pole position, and the Bentonville, Ark.-based retailer also picked up a solid amount of online shoppers. Roughly 39% of survey respondents said they bought a VMS product at Walmart, up 7% from last year, while Amazon saw 10% of respondents say they bought their vitamins from the e-tailer.

“Walmart continues to hold its leadership position in VMS sales at its brick and mortar stores, and it is showing online growth while Amazon remains at the top and continues to extend is lead in the e-commerce space,” said Kurt Jetta, president and founder of TABS Analytics. “These trends counter conventional wisdom that online sales are coming at the expense of purchases in physical stores. These two types of outlets do not need to be mutually exclusive; rather they both can continue to grow sales with the right approach to marketing and product mix.”

From a channel perspective, food retailers saw gains, making up 18% of the market, as such specialty stores as GNC and Vitamin Shoppe remained static. Losing share were club stores and the natural food channel TABS said. Penetration also increased in the past year, hitting 78% in 2018, with most growth attributable to the 2% increase in shoppers who purchase 1-to-2 product types. Though purchasing by women 55 years old and older dipped 9%, TABS said that was offset by an increase in purchases from men across age groups.

Products seeing growth are adult multivitamins, vitamins B and D and niche products. In particular, gender-specific launches helped grow multivitamin penetration to 55% from 48% last year. Melatonin also was a driver among niche products. Declining in popularity are fish oil and calcium, with fish oil’s penetration dropping to 22% in 2018 and calcium penetration hitting 17% after remaining steady for two years.

“Analyzing more than a decade's worth of data, the VMS market is showing the classic characteristics of a mature category and I expect that mass market and eCommerce will continue to expand, at the expense of specialty retailers," Jetta said. “In fact, specialty outlets are under duress in other sectors such as baby, sporting goods, and books. Looking ahead, we expect growth of about 4 percent to 5 percent between 2019 and 2021, but this could increase depending on inflationary pressures, which are highly likely over the next 12-24 months.”

To read the TABS VMS white paper, click here.
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