So said industry analysts from SPINS and Euromonitor who took part in an online panel discussion as part of the Future of the Microbiome Winter Summit.
They discussed market trends driving growth within the gut health category, looking at consumer trends, regional variations, and the outlook for 2024.
Cash-strapped consumers seek out multifunctional products
Scott Dicker, director of market insights at wellness-focused data technology company SPINS, highlighted functional ingredients as a macrotrend driving growth in the industry, with consumers seeking combination products that offer enhanced benefits.
Pricing pressures in the US and Europe have led to this proliferation of multifunctional supplements “purporting to provide benefits across a range of health needs”, according to Matthew Oster, industry manager for consumer health at Euromonitor International.
“Consumers are engaging with supplements from a more holistic perspective,” he said. “They're looking for products that are both efficacious, but also efficient in terms of meeting their needs without numerous pills – and so you can see already formulators and marketers that are introducing a number of new blends, or they're even repositioning existing products to include messaging around more popular benefits.”
This gives enterprising brands an opportunity to open up the category to new consumer groups; positioning products around benefits for the gut-brain axis, for example, offers a pathway for high-stress individuals to engage with digestive health products.
Oster said Euromonitor was starting to see “more and more of this popping up in the UK and Europe”.
He added: “Multifunctionality, I think, is a pretty dramatic component here, where instead of changing formulations, it's maybe [about] changing messaging and incorporating new concepts and new benefits to an existing product. I think… that's the segue out of the early 2020s into the mid-2020s.”
Gut health: Which global trends will help stimulate growth?
Dicker identified products targeting immunity, mood, cognition, and women’s health in addition to gut health as driving growth within the category, adding that mood support was the area where he expected to see the highest growth.
“I think it's an easy way to position the product, even if it is for digestive health,” he said. “I feel like it's an easy, marketable thing to say: if you're not bloated, if you're not having discomfort, you're going to be in a better mood.
“I foresee a lot more of these products being positioned as mood support, because that's a hot health-focused trend overall in food and beverage and supplements.”
Another area offering growth opportunities is women’s health, which SPINS has named as one of its key trends for 2024.
Dicker said: “There's definitely a role that the microbiome, pre-, and probiotics can play in that, and so I see products doing well for feminine health in the pre- and probiotics space.”
Oster agreed that the outlook is good for tailored women's health solutions, which he said he expected to be “really prominent, especially within pro- and prebiotics”.
He added: “What's fundamental here is that supplements are an anchor product within consumer health, supporting the broadening of women's health solutions. And that includes microbiome products.”
Another, perhaps less expected, area of growth lies in baby and toddler products, said Dicker, where probiotics have been gaining traction due to their potential role in allergy sensitivity reduction.
“One of the trends we're seeing is more allergens being added to baby and toddler food… We see an opportunity in the market there,” he said.
Finally, Oster said, “the rise of prescription weight loss drugs last year opens up new avenues for microbiome-oriented products”.
For now, at least, the digestive health-plus trend is here to stay.
“One of the reasons we know that this trend will continue, at least for the short term, is it's really, really popular online,” said Dicker. “Tracking some of the social media trends, you see gut health has, you know, 6.8 billion views on TikTok for 2023; GutTok on its own has over a billion views.”
Regional variations in gut health market trends
Oster highlighted the divergence in growth in different markets, in part due to inflation but also because of the aftershocks of the pandemic.
“We are witnessing a pretty stark divergence between regions roughly since 2022,” he said. “In a general sense, there has been some softness that has settled into the US market, which is the leading market for dietary supplements globally.”
However, other regions tell a different story. Oster used China as an example: its lockdown officially ended in the first weeks of December 2022, with “dramatic” corresponding changes in consumer behaviour.
It means the situation for probiotics as a category has flipped, he explained: in 2015, 23% of the probiotic supplement marketplace came from Asia, compared with 41% from the US – while in 2023, the US represented just 28%, compared with 42% for Asia.
Of course, the situation in China is unique, and growth is expected to slow dramatically; however, under current projections, Oster predicted the Chinese market could overtake the US “as soon as 2025”.
“We're seeing movement from the US to China as the driver of growth for the category,” he said – which, in turn, is driving a lot of innovation.
He added: “It really is making it a very interesting global marketplace.”