COVID-19 kick-starts e-commerce revolution as Nestlé Health Science scales up online presence

21 Apr 2020 --- COVID-19 is kick-starting a broad range of industry changes as people’s lives and how they purchase goods has undergone a massive overhaul. With brick-and-mortar retailers around the world closing, e-commerce has suddenly become the default, with companies including Nestlé Health Science (NHSc) rapidly expanding their reaches. NHSc will scale up a number of its brands on a global scale, thanks to its partnership with The Hut Group’s technology services division, THG Ingenuity, which will deliver a fully serviced e-commerce platform.

“The partnership allows NHSc to launch and rapidly scale its leading brands online and enter major new global territories. The current COVID-19 challenges have highlighted the importance of robust direct-to-consumer (DTC) models and infrastructure to ensure people continue to receive the essential products they need, safely and efficiently,” a THG Ingenuity spokesperson tells NutritionInsight. 

THG Ingenuity’s end-to-end capability, technology services and geographical reach will be used to launch some of NHSc’s leading brands – including OPTIFAST, Minami, and Klean Athlete – online in 20 territories across North America, Europe and Asia. The long-term partnership effectively allows NHSc to outsource the full e-commerce journey from customer acquisition through to product delivery to THG Ingenuity.

The partnership also gives NHSc with a single service-point, with THG Ingenuity providing global fulfilment and payment infrastructure, web development and hosting, digital marketing and content development, translation services, data science capabilities and global operations support.

“The agreement with NHSc is a major endorsement for THG Ingenuity’s comprehensive offering. THG Ingenuity is designed specifically to cater for a brand’s every need from customer acquisition and content marketing to payments and processing through to delivery. It has now become the world’s most comprehensive brand and technology platform and we look forward to helping further power NHSc’s international growth,” says Matthew Moulding, Founder and Chief Executive Officer of THG. 

THG Ingenuity, which enables the dispatch of 68 million items to customers globally, is also currently partnered with a range of other international retailers, including Procter & Gamble, Walgreens Boots Alliance, Johnson & Johnson, Groupe L’OCCITANE and Nintendo.

NHSc is already active in e-commerce, with a recent financial overview pointing to its personalized nutrition service, Persona Nutrition, as a profitable e-commerce asset.

Wellness businesses shift online
Other companies are also seeing new potential in e-commerce, including supplement brand RARI Nutrition, which is expanding its e-commerce reach with a partnership with Swanson Vitamins. RARI has been on an upward trajectory thanks to its partnership with TruLife Distribution, which notes that online sales have been booming as stores close across the US and consumers try to limit interaction with others. 

“We’re seeing a major shift towards e-commerce and online ordering, especially in the health and wellness industry. People are stuck at home and looking for ways to stay busy and motivated. We’re excited that we could help RARI get their products sold on a wider variety of platforms in time to meet their customers’ demands during these unforeseen times,” says TruLife founder Brian Gould.

Also surging ahead online is Neptune Wellness Solutions, which has expanded its e-commerce team with the appointment of Caroline Fontein as E-Commerce Manager. She will lead and grow Neptune’s DTC e-commerce business across its Forest Remedies and Ocean Remedies brands, as well as future consumer brands. 

Increasing numbers of consumers are turning to online resources for their everyday needs.“We believe our DTC strategy is even more relevant in light of COVID-19 as we anticipate an acceleration in e-commerce business over the coming months and years. Fontein brings significant relevant experience in digital marketing, vitamins, supplements and nutraceuticals. She will play a key role in driving our strategy of getting closer to the consumer with mission-driven health and wellness brands and products,” says Michael Cammarata, CEO of Neptune.

The Canada-based company’s e-commerce strategy includes enhancing its paid and organic digital marketing initiatives across online search and social media platforms to drive growth of its consumer packaged goods (CPG) brands in key health and wellness markets, including nutraceuticals, personal care and home care.

As part of this, Neptune is now partnering with Google’s Growth Acceleration Team and was recently granted approval to advertise its products, including hemp-derived products, on Google’s advertising platforms. 

Meanwhile in February, a Glanbia spokesperson told NutritionInsight that the company is seeing more of an appetite for online sales than ever. “We are moving with this trend as we serve our customers through various online platforms. We see digital as a very important route to market going forward,” they said.

Challenges abound
However, this e-commerce boom comes as many consumers are struggling to access various products. Last month, mail-order giant Amazon announced a shift in policy to temporarily prioritize household staples, medical supplies and other high-demand products coming into its fulfillment centers. Meanwhile, there is an ongoing battle led by the National Products Association (NPA) in the US to keep health food stores open. The NPA argues that the closure of health food stores in states, including Colorado, Massachusetts and Nevada, is in contravention to guidance from the Department of Homeland Security (DHS), released last month.

In other challenges, Life-Space, the Australian probiotics subsidiary of Chinese food company By-Health, recently failed to meet its annual expectations in China. This was a consequence of China’s new e-commerce law, which drove down transactions and product stocking and ultimately had a “huge negative impact” to the Life-Space Group.

To keep readers informed of these rapid developments, NutritionInsight is updating its daily news feed for the coronavirus-related information and insights you need to guide your business through this challenging period.

By Katherine Durrell