A Quick History of Supplement Marketing

The supplement industry really only started in the 1950s with the sale of vitamins, and for the first fifty years, distribution happened mainly like this:

• Mail order (Puritain’s Pride, Swanson Vitamins)
• MLM, pyramid marketing, network marketing (Herbalife, Amway)
• Brick/mortar health stores (GNC and independents)

With the start of the internet, marketing changed fairly quickly. Mail order catalogs are now almost obsolete and distribution moved online. The MLM industry has been in decline and many of those companies have moved more toward omnichannel marketing. Brick/mortar health stores have also really suffered due to the ease of ordering online.

Today, Amazon is a huge player in the supplement space, responsible for tens of billions of dollars in revenue/year. The other big shift that occurred over the past decade was the emergence of DTC (Direct-to-consumer).

DTC brands such as AG1 advertise heavily on platforms like Google, Tiktok, and Facebook. They also look rely on influencer marketing (using online personalities to generate brand exposure).

While the DTC premise is that customers get higher quality products at better prices (by cutting out the “middleman”), the truth is that the “middleman” still exists: the advertising platforms have become the middleman and usually account for over half of the DTC budget. As a result, supplements have never been more expensive and gross margins have never been higher.

The other disrupter in the industry was COVID. It is hard to overstate just how the pandemic supercharged the supplement industry. In fact, what was a $15 billion dollar industry just a few years ago is now predicted to be close to $130 billion within five years.

The emergence of DTC and the pandemic has created an environment where entrepreneurs and businesses of all sizes have flooded the market. There are innumerable brands, many indistinguishable from each other (often just private labels). And while consumers cannot complain about lack of choices, they have every right to complain about a flood of deceptive marketing, overpricing, and lack of quality.