The Health, Wellness and Nutrition segment of eCommerce has seen an unprecedented surge in recent years. According to a report by ResearchandMarkets.com, the current valuation of the nutrition supplement webstore industry stands at a staggering @12.9 billion, fueled by a Compound Annual Growth Rate (CAGR) of 10.9%. Since the onset of the COVID-19 pandemic, there has been an evident and noticeable uptick in the direct-to-consumer (DTC) module of business – many organizations have taken to direct route to reach consumers and maximize their revenue by capturing more trusted buyers in the nutrition supplements industry. According to Retail Drive, nearly 6 out of 10 consumers in the US have been making direct purchases from companies since 2021.
This evolving customer behavior showcases the growing inclination and changing trend among consumers to procure their nutrition supplements and products directly from the manufacturers, bypassing traditional retailers like Costco or Walmart. However, there are various other factors that drive the customer to make direct purchases in this segment. Building and maintaining trust is a crucial aspect of sustenance in this industry since counterfeiting poses a major threat. Consumers will not tend to make repeat purchases from companies if the products do not meet their expectations and claims. The US Food and Drug Administration (FDA) understands this threat and has remained vigilant in addressing issues related to counterfeiting.
The scope and expanse of eCommerce in the nutrition supplements and wellness industry is unfathomable and it is only increasing day by day. Join me and take a more detailed look at the multifaceted ecosystem of eCommerce in this industry.
Typical Characteristics of Nutrition Supplements or Vitamin Industry
With our interactions with the buyers in the vitamin supplements segment, we have come across an interesting array of attributes coveted within the online stores. The following are some of the features that are shared by some of the largest eCommerce platforms in the market.
1. B2C Webstores
The majority of these online stores in the nutrition supplements industry cater to the B2C market primarily. However, with health and wellness becoming such an important part of the demographic regime, there are significant B2B clients who prefer to place large bulk order directly from their ERP (Enterprise Resource Planning) system. These orders seldom go through the online store since they are typically processed within the back-end application itself. The prevailing method for managing such bulk purchases involves Electronic Data Interchange (EDI) which ensures a smooth and efficient data transfer process with the help of best-in-class integration platforms. This shift in the ordering methodology showcases how adaptable and diverse these online stores are and how efficiently they navigate between individual customers and businesses alike.
2. Enriched Product Information
Companies in the health supplements sector go far and beyond when it comes to product description, information and disclosure. Successful businesses in this vertical have proven strategies that state how a well-described product with precise information tends to grow into a brand itself. This commitment is not only driven by statutory regulations but also aims to streamline and simplify the customers’ buying experience. Companies in this segment provide all the necessary details of the products like composition, allergies and dosage, in a clear and organized manner, emphasizing on empowering the buyers to make well-informed decisions by providing them with a thorough understanding of the products, suited to their body. This reflects customer-centricity within this industry and the need for transparency.
3. Low Visitor-to-Conversion Ratio
Online stores in the health supplements sector attract a natural influx of visitors, pertaining to the ongoing quest of finding the right product with the necessary information. Due to this, the initial visitor-to-conversion ratio is low and modest. However, once the organization establishes itself as a brand in the market and solidifies its presence to its loyal customer base, the potential to generate greater orders becomes promising.
4. Pressure on Near-immediate Shipment
A crucial metric for health supplements companies revolves around fulfilling same-day deliveries promptly, a key determinant of customer satisfaction. This metric assumes great importance when it comes to health-related products. The underlying rationale behind this fact lies in understanding that customers are averse to the risk of running out of items, especially when it comes to health supplies. The significance of same-day shipments is also accentuated by the behavior of buyers who often tend to place orders at the eleventh hour. This underscores the critical need for these health supplements companies to implement a robust and swift shipping solution in order to meet customer satisfaction levels. This would not only address the customer needs but also play a pivotal role in building trust and loyalty for the company in this niche.
5. Strive for Zero Returns
Handling returns is a significant aspect across various industries, but within the health supplements and vitamin industry, it is a matter taken with exceptional gravity. The return processes for these industries are intricate, involving meticulous evaluation of the quality of the returned product and strategic discussions on whether to restock it for future sales. Adding to it, the FDA also prescribes when a returned product needs to be destroyed. In order to minimize returns in this sector, the companies adopt several proactive measures, including detailed product information and a cancellation window. These practices not only contribute to refining customer communication but also reduce returns by aligning customer expectations with the products and delivering a harmonious customer experience.
6. Evolving Regulations
The FDA and other regulatory bodies exercise a strict and stringent oversight over this industry, ensuring compliance and maintenance of high standards for the products and practices. For example, if a company sells CBD range of products, they have to associate themselves with regulations that prohibit them from doing so in certain states. This shows the ever-changing landscape of regulatory requirements, encouraging businesses to adapt and align their organizations with evolving standards.
Creating a Successful Nutrition Supplement Webstore / Vitamin Webstore
To achieve success in the nutrition supplements and vitamin webstore industry, it is crucially important to have a comprehensive understanding of its market dynamics and associated challenges. To explore this, we will examine some of the pivotal factors that contribute to the success of these online stores. These factors can be classified into two categories:
- Front-end factors or visible factors
- Effective back-end
The front-end factors play a vital role in attracting website traffic and optimizing conversion rates. Conversely, efficient backend elements help in automating fulfillment processes, ensuring profitability and enabling flexibility in operations to handle peak demands. Furthermore, the streamlined backend also facilitates running promotions, ultimately leading to higher revenue. It is the interplay of these front-end and back-end elements that lay the foundation of sustained success in the nutrition and vitamin industry.
Through strategic focus and optimization of the following factors, a health supplements/vitamin webstore can thrive and achieve its goals.
Genuine Products from Brands
Purchasing products directly from the brand website or its own marketplace listing offers customers the assurance and confidence that they are acquiring authentic products. Several front-end elements contribute to the trust building between the buyers and the company:
- Company history/user history
- Consistent branding elements
- Social proofs and testimonials of the products
- Certification and disclosure
- Graphics and Product Quality
These factors collectively contribute to improving credibility and trust in the brand, ensuring shoppers have a positive shopping experience.
Building Trust and Purchase Intent Through Detailed Product Information
Numerous customers are constantly seeking the perfect nutrition and health product that suits their needs. Given the nature of such products, it is imperative to provide all crucial details like ingredients of the product, allergens, dosage and FDA approval. Displaying this information assures that the customers are well-informed, enabling them to make decisive decisions with confidence.
Social Influencers Influence Nutrition Supplement Webstore
Endorsements from celebrities and social media influencers can significantly enhance brand recognition. Notable personalities like Jennifer Aniston, Arnold Schwarzenegger, Jennifer Lopez, etc. have lent their support to various health and nutritional supplements products. Moreover, there are several influential blogs with a substantial reader follow, such as Nutrition Facts, Quest Nutrition, Legion Athletics, PricePlow and Kath Eats that further contribute to the reach within the industry.
Return Policies
Different companies implement varied return policies depending on the product category. For the companies, it is recommended to clearly communicate these policies with the public. For a comprehensive understanding of return policies and associated FAQs, refer to this dedicated section on the iHerb website. Also, abiding by FDA regulations around dietary supplements is a must and ensures trust in the brand.
Aligning Back-end Efficiency with Front-end Excellence for Nutrition Supplement Webstore
Ensuring customer satisfaction on the webstore is more than just a mere commitment, it demands a collaborative effort across various departments of the organization. Departments such as Purchase, Marketing, Warehouse and Finance need to synergize their efforts and work harmoniously to attain this goal while upholding the basic objective of profitability.
To elucidate, let’s delve into some pivotal considerations:
Up-to-Date Product Listing
Ensuring comprehensive product information is paramount and crucial, encompassing associated variants and detailed specifications. Accuracy is key when representing product labels, dosages, and other pertinent details. It is also essential to promptly remove discontinued products and introduce new ones when necessary. This approach contributes to an informed and positive customer experience.
Pricing and Promotions
To achieve success in the competitive market for nutritional and health supplements, it is crucial to implement a well-planned pricing strategy. While timely promotions are instrumental in driving sales, it is equally important to conduct profit calculations before initiating any promotional activity. This approach ensures that the business not only entices buyers with appealing offers but also remains profitable over time.
Third-party Fulfillment
As mentioned previously, achieving customer satisfaction in this sector is paramount. An increasing number of companies are opting to delegate their fulfillment operations to third-party logistics providers (3PL). For these organizations, it is crucial to establish seamless integration between their applications that enable the swift transfer of order data and details to the 3PL, ensuring same-day deliveries. An example is Health Planet’s implementation of Instacart Deliveries, showcasing strategic implementation that significantly enhances the overall customer experience.
Stock Sync to Eliminate Customer Churn
In the nutrition and health supplements industry, if a customer places an order that cannot be fulfilled due to a shortage in stock, there is a considerable risk of losing them permanently. This aspect holds great significance and ensures that the customers are always taken care of.
A simple and straightforward solution to achieve and enhance this efficiency is to establish a robust and seamless integration between the ERP and the eCommerce applications of the business. This integration will ensure accurate stock sync and reduce the chances of unfulfilled orders, consequently mitigating the risk of customer churn.
An ERP (Enterprise Resource Planning) system serves as a repository for both financial and operational data, acting as a central hub for both order fulfillment and tracking financial performance. It is crucial to guarantee a seamless and smooth integration between the web orders and the entire fulfillment cycle, which can only be achieved through a pre-built integration solution. If you want to explore such a solution, consider APPSeCONNECT as your best fit!
Case Study of Some Nutrition and Health Supplements / Vitamin Websites
Now that we know what goes into making a successful health supplements company, let us take a look at some of the organizations that have aced the strategy.
Healthy Planet
Based out of Toronto, Canada, Healthy Planet primarily caters to the North American vitamins and health supplements market. While most orders are for domestic shipping, a small percentage of them involve international shipments. The company has implemented a seamless and streamlined integration between SAP Business One and Magento to align their back-end ERP system with their eCommerce platform. This cohesive integration between the two platforms enables them to efficiently process larger volumes of orders daily. Explore the Healthy Planet case study here.
Natures Plus
Situated on the East Coast, this American company boasts a storied tradition and a captivating history. Opting for Shopify as their eCommerce platform, they aimed to optimize and streamline their entire checkout and fulfillment process to better serve and deliver to the customers. With the accurate integration of Shopify and SAP ERP, Natures Plus was able to minimize their delivery time and enhance the customer experience. Read the Natures Plus case study here.
Essential eCommerce Platform Features for Health and Nutrition Supplements Webstores
To efficiently run a health supplement webstore, a suitable eCommerce platform needs to be in place. Following are some of the most essential features that these platforms need to compete in this segment.
SEO Capabilities
SEO plays a vital role in the online growth of any website and generates a significant amount of organic traffic. The term “Vitamin D Supplements” has over 33,000 monthly searches and has intense competition for ranking. Putting an effort to rank in this keyword would surely bring traffic to the website. However, the real potential lies in expediting the long-tail keywords. Once the brand has identified its niche, it can rank higher on the SERP and attract more prospective buyers to its website. The eCommerce platform, therefore, should provide robust SEO features and the ability to have an integrated blog from the start.
Ability to Support Multiple Brands
Nearly 75% of the companies I have worked with operate with multiple brands. For an eCommerce platform that adeptly caters to this business reality, it is essential to support a multi-site structure. This ensures that the platform can seamlessly accommodate the diverse needs of these companies and their various brands.
Theming and Design Templates
During our earlier discussion, we underscored the importance of branding and trust generation. It is crucial for eCommerce platforms to provide an extensive array of themes and design templates to the users to choose from, enabling a diverse selection. These choices allow for greater customization of the eCommerce website and enhance the overall user experience.
Scalability and High-Traffic Capability
Considering the dependency on substantially high traffic, it is imperative for the eCommerce platform to be able to demonstrate scalability and optimized performance. This scalability ensures that the platform can seamlessly expand to accommodate the growing needs of the market, while optimized performance ensures a smooth and efficient user experience under heavy traffic. Read this article by BigCommerce on why scalability and performance are so critical for any eCommerce platform.
Support for Product Variants
In this sector, the availability of product variants in the eCommerce platform is absolutely crucial, such as 30 tablets or 60 tablets of vitamins and so on. Moreover, the ability to create product bundles, such as combining kids and adult health supplies, adds an extra layer of functionality to the platform. These coveted features simplify the life of eCommerce managers and contribute significantly to the efficiency of their daily operations.
Rich API to Connect with ERP
Achieving operational efficiency relies on the seamless integration of applications, making it necessary for an eCommerce platform to feature a flexible yet robust API. Keep in mind that many SaaS-based eCommerce platforms have API limitations that can hinder integration. Being cognizant of these limitations assists users in determining the frequency at which integrations can be executed.
Comprehensive Marketplace and Add-ons
As business needs evolve, possessing a platform with a dynamic ecosystem and an active community becomes invaluable. Platforms with a helpful marketplace featuring tons of tools and add-ons foster growth, collaboration and innovation, paving the perpetual way toward success.
Fraud Prevention
When it comes to nutrition and health supplements, credit card sales can bring about a unique set of concerns. It is common in this segment to encounter a substantial order volume only to discover that it was placed using a stolen card. From my past encounter, nearly 0.5% of orders turn out to be fraudulent. Desired eCommerce platforms must have features that facilitate the easy management of such issues. For the curious, you can explore how Shopify handles Fraud Analysis.
The following are some of the usual choices buyers make while choosing an eCommerce platform in the nutrition and health supplement industry:
Shopify
Widely favored by small and medium enterprises, Shopify stands out for its intuitive interface and simple usability. Renowned for its user-friendly features and customizations, it offers an extensive selection of themes and add-ons, making it a top choice among eCommerce managers.
Adobe Commerce (formerly Magento)
Formerly known as Magento Commerce, Adobe Commerce is a high-end, premium eCommerce platform tailored for enter-level businesses. Boasting advanced features and functionalities, it offers complete personalization and targeted marketing capabilities. Adobe Commerce provides a holistic foundation for executing the complex strategies that businesses set.
BigCommerce
This is a platform known for its flexibility, adaptability and robust features. BigCommerce offers support for multi-channel selling, streamlining and making it easier to manage multiple online stores from one centralized location.
Extending Reach with Marketplaces – Nutrition Supplement Webstore
In the nutrition and health supplement industry, marketplace listings offer vast opportunities to acquire a new customer base. Some of the benefits of selling on marketplaces include:
- Increased visibility
Listing products across multiple marketplaces broadens the product spectrum to a larger audience, increasing the brand’s visibility. This increased visibility has the potential to generate more sales, attract new customers and increase revenue. - Trust and Credibility
Marketplaces often have established trust with their customers, giving the buyers confidence in making the purchase from their platform. This can benefit smaller businesses or emerging brands that may still be in the process of establishing trust with their buyers. - Reduced Marketing Costs
By utilizing marketplaces, companies can save significantly on marketing costs, as these platforms inherently bring traffic and potential customers. This is particularly beneficial for smaller businesses that have a limited advertising budget.
Prominent marketplace leaders in this vertical include Amazon, Walmart, Target and iHerb.
Industry Trends and Innovation in Nutrition Supplement Webstore, Health and Wellness Sector
As we have examined the factors that contribute to a successful multi-channeled eCommerce store, it is time to explore the evolving trends and innovations within the dietary and health supplements market.
Increased focus on subscription
Nutrition and health supply companies are increasingly adopting a subscription-based model, offering discounted prices for recurring orders. For example, look at Atlanova, a company offering monthly subscriptions for Vitamin B12 capsules at a discounted rate.
Personalized Medicine
A prominent trend in the medical field that is rapidly growing is the demand for personalized medicine, presenting the opportunity for customized optimal outcomes based on individual genetic profiles or online assessments.
Notable companies involved in this space include Hum Nutrition, Nourish, Ritual and Personal Nutrition. Embracing this approach carries great significance in revolutionizing healthcare by delivering targeted solutions for better well-being.
IoT (Internet of Things)-based Demand Generation
The seamless integration of IoT in the operations and workflows of the dietary and health supplement companies represents groundbreaking innovation. In this segment, IoT, like smart caps have transformed the landscape of medication – by precisely measuring the medicine quantity through bottle openings and the remaining level of medicine.
This technological advancement has not only elevated data accuracy but also substantially enhanced user convenience. Explore this webinar where me and my colleague Riaz showcase a prototype of an IoT and demonstrate how it can seamlessly place orders directly to Shopify Salesforce or SAP.
Conclusion
The creation and management of a successful nutrition/health supplement or vitamin store demands a considerable amount of effort, dedication and hard work. While customers are exposed to only 30% of this journey, the rest 70% is concealed within the intricacies of the back-end operations.
While selecting the appropriate eCommerce platform for health supplement and vitamin industry, effective branding and strategic promotions are crucially important, and equally important is the seamless back-end integration of the eCommerce and the ERP for resilient fulfillment.
