Growth Opportunities in the Omega 3 Market
25 Jun 2015 | DSM
This is Rob Wires at the Vita Foods in Geneva, and I'm here with Brent McDonald from DSM and DSM recently revealed the results of a survey conducted into omega 3 and the omega 3 market.
Brent, can you give me some of the, the insights from this survey and what, what you concluded from there?
There's a, there's a variety of different conclusions, depending on which geographic region you're, you're most interested in, of course, but I think one of the big conclusions is that each geography, each, each nation has, different motivators for buying omega 3 products.
They have different levels of understanding, and they have different issues in each market.
So how communicate, how, how consumers are educated is different.
They know and what they look for on the shelf is in fact unique in each market.
What did we see in the European market, for example?
So the four markets that we studied in in the European market were the United Kingdom, Italy, Germany, and, Russia.
And so, you know, Russia has a distinct category, evolution.
Compared to the United Kingdom market, which is much more mature, the United Kingdom, for instance, is more reliant on cod liver oil as a source of omega 3, whereby although cod liver oil is present in the Russian market, they have different.
Health benefit motivators.
So for example, skin, hair, and eye beauty are more of interest to that consumer.
The German market is unique in the sense that they seem more reluctant as consumers in general towards supplements and in particular omega 3.
The, what particularly DSM results recently found quite a bit of decline in the US supplements market and that particular omega 3 is struggling.
What, what are the reasons for that and what, what can be done in order to stem this decline?
Yeah, I think.
I think I, I'd be careful to to qualify it as not as a precipitous decline necessarily so much as it is a maturation of the market.
We've done similar or several intermediate studies, between the last UNA and this one, that would suggest that the markets, it, it really is at a mature maturity and a little bit of a decline.
But really what it comes down to is that most markets are highly transitional.
There's a large proportion of the consumer base who is what we would call, the lapsed users, so they come in and then they leave.
And the motivators for leaving it is very different in each market.
So in the United States, you know, capsule size and sensitivity around Burtback are important issues, that are being addressed by some products in the market today, whereby when you compare that to Russia, or the Norwegian market, for instance, seasonality is a key driver for entering and leaving the category.
So in terms of what needs to be done in the US, and GE's leading a coalition effort to reinforce for consumers why they need to take omega-threes.
It's really about having continued reasons to buy, so reinforcement of positive messaging around the benefits associated with omega-three, whether it be heart health.
Brain health or just general overallness.
Are they looking to other application areas?
What do you mean?
Different types of food products as opposed to the supplement sector.
Sure, the survey we did was focused purely on supplements, and the food and beverage industry has.
Sub-segments of the food and beverage industry has established footholds in the omega 3 category.
The dairy market in particular has done reasonably , but, but an area that certainly emerged, I think, in, in a lot of markets, not only the United States, is a sort of a pseudo supplement.
Gummy bears and alternative forms like that are.
High interest for consumers.
Particularly as the market, as I mentioned, is maturing.
You're reaching a mass market consumer now.
They're looking for convenience, so ways to consume the product that doesn't necessarily, provide a large capsule and a fishy burpback experience.
Which regions do you think are most promising for?
Growth for omega 3, without doubt, you know, the emerging markets, China, of course, is on everyone's radar.
I think Russia has high potential for growth as far as the European markets are concerned.
Asia Pacific and as as South America are probably the markets that are most positioned for.
For growth going forward are you looking to other areas to further substantiate studies behind omega 3 and are kind of new health platforms that you might be assessing?
Yeah, , I guess the other part of the other nuance in the consumer's mindset is that depending on the region, different health benefits are more important.
So looking at the United States, omega-threes are mostly associated with omega, heart health, whereby if you look at the Australian market, it's almost entirely focused on, on joint health.
China is a little bit more focused on brain health, so I think it's, I, I can't say that there's one thing specifically that I, I would look to except that I would appreciate the fact that there's, there's nuances in every geography, and the motivators for those consumers are different and their knowledge levels are different in each.
Brent, thank you very much.
You're welcome.
