Finding Value and Trust in Branded Ingredients

We know the value of consumer trust and we look for ways to build it. Consumers are looking for evidence and information. The marrying of these two concepts is what has evolved into the branded ingredient offering—the ‘Intel inside.’ Branded ingredients were a relatively new concept 20 odd years ago, but now they are a prevalent part of our industry, although often misunderstood and undervalued by both brands and retailers.

While not all branded ingredients are alike in their value and benefit, they all strive to differentiate themselves from unnamed commodity or generic ingredients. Commodity-only ingredients are often sold on a purely transactional basis with price being the primary determinant in the purchasing decision process. There are five components of the branded ingredient concept that go beyond this transactional process and should work to build trust with the consumer:

• Science
• Education
• Consistency
• Transparency
• Quality

SCIENCE is the key to gaining the serious and loyal consumer of dietary supplements. Trust Transparency Center recently surveyed over 1,000 supplement users and found science to be the most important factor when choosing a supplement to purchase. Clinical trials are an important attribute to branded ingredients. It is true not all ingredients have a robust clinical dossier, but many do. One great example of an ingredient supported by science is the ingredient Epicor. This immune-supporting ingredient lists eight published human clinicals including six randomized, double-blinded, placebo-controlled trials and two published series of in vitro studies. This level of commitment to science is shared by other ingredient manufacturers including Sabinsa, Fuji, Stratum Nutrition, and Kaneka Nutrients, to name a few.

Science Takeaways:

  • Science is the foundation to demonstrate the value of the products you carry.
  • Investigate the quantity and quality of the substantiation of the claims made by the brands you provide your customers.

EDUCATION is the driving component to establishing consumer trust. This component of branded ingredients offers the greatest opportunity to partner with your customer to display the extra effort education sharing can provide. Learning and training to provide a more detailed offering and analysis of ingredients builds loyalty, confidence and trust with your customers and builds greater engagement with your employees. Taking time to provide education sessions for your employees and customers can provide great advantages to all areas of your business. Education has become a routine offering of the internet but the in-person interaction from an associate or advisor can go a long way to make the material more understandable to your clientele. Many branded ingredient suppliers will assist with these education sessions if asked.

Education Takeaways:

  • Integrating education into both your employee and consumer interactions builds confidence in your store as well as the products you carry.
  • Reach out to branded ingredient manufacturers to obtain additional education resources.

CONSISTENCY is important to consumers, and branded ingredients offer this assurance. Ingredient specifications can vary greatly between suppliers. Consumers today have a shorter span of product trial than ever before. Social media, influencers, and an abundance of alternatives have provided a short runway to establish a connection with a consumer. Branded ingredients have a uniform set of specifications that has little variability, providing greater assurance of the benefit of the product. Consistency of message is also important to remember. Just like every member of your staff is important to your success, every ingredient in every product is also an extension of your own brand.

Consistency Takeaways:

  • Branded ingredients offer a higher level of consistency that you can typically count on for providing reliable benefits.
  • Consistency is as important in your store, brand, and employees as it is to the brands you provide.

TRANSPARENCY is the new reality when it comes to consumer loyalty. Today’s consumer will not be lied to and branded ingredients routinely provide verified and vetted information about product, process, and science. Transparency makes trust stronger and branded ingredients know this. Brands such as Doctors’ Best and Healthy Origins have built decades-long brands on the concept of putting the branded ingredient on the front of the bottle versus just mentioning the ingredient on the supplement panel on the back of the bottle. Branded ingredient manufacturers offer greater detail of information, education and science about not only the ingredient offered, but also the benefits and health claims associated with the ingredient. In addition to the benefits of the ingredient, the brand website often details the process and place of manufacturing. There is often a story associated with the history or discovery of an ingredient that helps to reinforce the value of the ingredient and the product your store offers.

Transparency Takeaways:

  • Consumers increasingly use transparency as a bridge to trust.
  • Branded ingredient manufacturers typically provide a great deal of information to support the story, production and benefits of an ingredient.

QUALITY is the summary of all the components that make up the value of branded ingredients. Consumers who conduct research inspired by branded ingredients remain more loyal to the concepts of quality and compliance than consumers who rely strictly on product brand information, as was reported by the 2013 Parthenon Vitamin Survey. This survey also indicated the consumer was more likely to believe the product that prominently featured a branded ingredient had a higher price point than a similar product, when in fact, that was not typically the case.

This column has repeatedly reported on the number of products offered through e-commerce that offer inferior quality, including little to no active ingredients. Trust Transparency Center and its partners such as the CoQ10 Association, the Natural Astaxanthin Association, the Global Curcumin Association and others have tested hundreds of products to confirm identity and assay of product ingredients. The number of Amazon retail products failing these tests has ranged from 10% to 26% depending on the ingredient. NOW Foods recently conducted another round of tests that further shows the disparity of quality that exists in the marketplace. Of all the tests conducted—by NOW Foods, Trust Transparency Center, or its partners—not one failure featured an identified branded ingredient as part of the formulation.

While merely featuring a branded ingredient does not ensure quality, historically, companies who wish to market inferior products do not go to the extra trouble to call out a branded ingredient.

Quality Takeaways:

  • Attention and focus on quality builds consumer loyalty.
  • Attention to branded ingredients and the information they provide lends itself to an increased perception about not only the product you elect to sell but also your store brand in general.

The evolution of branded ingredients in the marketplace is a positive development in the industry. This evolution has opened the doors to greater supporting science, transparency, education, consistency and quality. Branded ingredients are an undervalued and underutilized resource for the natural health food stores and their dedicated employees who are passionate about this industry. WF

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Scott Steinford, Founder, Trust Transparency Center
Scott Steinford has built a career of leading, learning and mentoring. Through immersion in many aspects of the supplement and pharmaceutical industry Scott has worked to redefine and improve business practices within the healthcare industry with an emphasis on transparency. His experience ranges from entry level to CEO and positions include organizations representing ingredient supplier, ingredient manufacturer, retail brand, private equity, M&A due diligence expert and trade organizations. Scott has a Pre-Law Bachelor’s Degree from the University of Texas at Arlington and a Master’s of Science Degree in Law from Champlain College. Scott currently is Executive Director for the CoQ10 Association and President of the Natural Algae Astaxanthin Association (NAXA) and Founder of Trust Transparency Center, a boutique consulting organization dedicated to assisting companies seeking to improve both their internal and external trust transparency. Scott’s prior experience includes CEO of Doctor’s Best and maintained a pivotal role with a variety of ingredient manufacturers including Eisai, Kaneka and was a founder of ZMC-USA.

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