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WH Asks: Feeling Fine

IF THERE'S A UNIFYING THEME that describes the state of health and wellness in 2009, it's prevention. At least that's what a majority of retailers and manufacturers were thinking in the annual WH Asks poll, sponsored by SN Whole Health. As the focus on the rising costs of health insurance continues, there will be a focus on preventative health care, wrote a retailer. Another operator thought the massive

IF THERE'S A UNIFYING THEME that describes the state of health and wellness in 2009, it's prevention. At least that's what a majority of retailers and manufacturers were thinking in the annual WH Asks poll, sponsored by SN Whole Health.

“As the focus on the rising costs of health insurance continues, there will be a focus on preventative health care,” wrote a retailer.

Another operator thought the massive influx of aging Baby Boomers better explains why sales of natural and organic foods, supplements and eco-friendly products and services remain relatively strong despite the recession.

“More people are in an age group where these products are needed,” the retailer stated.

Whatever the reason, the recession seems to be having a shallower impact across the board than many feared. Despite the economy, an overwhelming number of respondents — 74% — expects sales of health and wellness-related categories to increase this year. That's down from 91% two years ago and 95% in 2006 — the height of wellness integration. To be sure, this year's percentage reflects today's economic realities. Yet, the level of optimism surrounding growth is evident with both retailers (70%) and manufacturers (73%).

One supplier put it best in writing that, while consumers are significantly more value-oriented these days, “when the consumer does spend, they know health dollars are a priority.”


Compared to prior years, when a majority of industry stakeholders believed wellness sales would grow in excess of 10%, this year the percentage is in the single digits. Most respondents (nearly 37%) stated they anticipate sales will increase in the range of 4% to 6%. Just over half of retailers agreed with the number, while only 28% of manufacturers did. Interestingly, the vendor community is slightly more hopeful about the year, with more than 34% predicting slightly stronger wellness sales of 7% to 9%.

“Consumers continue to be concerned about health and wellness despite [the] down economy and [are] willing to pay a little more,” was a typical manufacturer response.

A standard retailer refrain reflected price concerns: “Sales will increase only if priced right.”

Both groups of stakeholders were emphatic in stating the economic outlook has not kept their companies from cutting back or reducing their presence in health and wellness over the past year. More than 78% of retailers and 84% of manufacturers said that — to some degree — they continue to see increased investment in wellness initiatives.

“Health is still integral to many consumer segments,” said a manufacturer. “A poor idea would be to cut back on this important growth category/positioning.”

There are a number of categories under the health and wellness umbrella that respondents viewed as integral to continued growth. Natural/organic private label was the top choice overall, by a margin of 44%, followed by gluten/allergy-free (40%) and organic (38%).

Retailers were keenest on gluten/allergy-free, organic and natural/organic private labels — each of which were chosen by a margin of 46%. Manufacturers agreed on gluten-free, but gave a majority nod to whole grains as well (46% vs. 36% for retailers). Vendors also felt more strongly about omega-3 (25% vs. 18%) and antioxidant-enhanced (23% vs. 3%).

This year's results mirror and even build on those of past years. For example, in the 2007 WH Asks poll, organic and private label were also top retailer choices by wide margins. If anything, the percentages show a marked increase. In 2007, only 36% of retailers said organic was a foundation to their wellness offerings; 43% said private label. Both of these numbers increased in the most recent survey.

Not everyone felt so sure, however. Just over 11% of total respondents (15% retailers/14% manufacturers) said that their company had cut back on investments in wellness. “All major projects have been placed on hold,” wrote one.

Another, presumably a manufacturer, stated: “We've slowed our launches and reach based on retailers cutting back on the space they've allocated to these segments and SKU count.”

WH Asks included a question on the impact the recession has had on specific wellness categories. Answers seemed to match the level of price premiums typically encountered — the higher the premium, the harder the hit. For example, almost 39% of respondents stated that meat/seafood — where some specialty products carry a 100% premium — was hurt by consumer cutbacks in spending. That was followed by HBC, where unique formulas, eco-claims and similar attributes often translate into higher prices. Some 23% of poll takers said this was the category hardest hit by the sour economy.


Retailers and manufacturers have been using a number of incentives and value-adds to keep consumers interested in purchasing health and wellness products and services. According to the 2009 WH Asks poll, the use of coupons wasn't as strong as some other reports have indicated. Overall, 55% of those queried state that their company has not been seeing any increased traffic in healthy-product coupons. In contrast, 39% said they had. Of those who answered in the affirmative, nearly half — 47% — said the increases were in the range of 5% to 9%. Some 22% stated that coupon activity around healthy products was less than 5%, while 20% reported increases of 10% to 14%.

Breaking those numbers down, retailers were almost evenly divided regarding coupon use, with 46% reporting weaker redemptions and 48% reporting stronger rates. Just over 61% of manufacturers said they did not see any increases in activity, while 34% said they did. Asked about the level of increases, more than half (53%) of retailers who reported more coupon usage said 5% to 9%. Manufacturers were evenly divided (33%) between 5%-9% and 10%-14%.

Coupons are only a small aspect of the industry's overall marketing efforts for wellness products. Retailers are investing in events, loyalty card programs, in-store demos and tasting events, according to comments made by respondents. A number have built promotions around the calendar of awareness months (for instance, Celiac Awareness Month in October, or Organic Harvest Month in September).

“We incorporate our organic products in those events, and participate in others like Diabetes Week with our sugar-free offerings,” wrote one manufacturer.

Websites have emerged as a powerful outreach tool among retailers and manufacturers, though the number of respondents who reported having wellness sections on their sites increased only slightly from 2007, the last time this question was asked.

In 2009, 43% of total respondents stated they had links to wellness on their home pages, up from 38% in 2007. As expected, the numbers of those who reported no wellness components on their websites decreased, from 60% in the last survey to 53% this year.

Perhaps it's no surprise that more retailers than manufacturers reported having an online wellness presence, 56% and 36%, respectively.

On those websites, respondents said they offered a number of services. By far, the most common was healthy recipes (80%), followed by featured products (53%), health condition links (53%), dietitian columns (41%) and health blogs (27%). It's notable that all Web-focused retailers — 100% — said they had healthy recipes, while only 63% of manufacturers did. This is up substantially from 2007's survey, when only 76% of retailers operating websites said they included healthy recipes as part of their Web offerings.


As mentioned earlier, natural/organic private label was named the top wellness trend overall for 2009, with 44% of total respondents putting store brands at the top of their list. Again, retailers viewed private label more favorably (46%) than manufacturers (36%).

This marks a departure from prior surveys, however. In 2007, in the last WH Asks online poll, organic was still the top choice, at 36%; store brands were the second-most-popular choice, with 25% of respondents choosing it. And in last year's poll, a more comprehensive study conducted by Avero Research, less than half of respondents — 42% — stated they had a private-label organics program.

If this year's answers are any indication, better-for-you store brands are significantly more established. Just over half of all those polled said they now stock or compete against a natural/organic private label, with a majority of those brands (68%) having been introduced at least a year ago.

Retailers reported having more involvement with store brands. Just under 70% said they sold private label, as opposed to 52% of manufacturers. All categories were mentioned, but dry grocery — cereal, pasta and snacks — were highlighted by a majority. Others of interest included coffee, cough drops and in-store bakery products.

A new question this year asked whether natural/organic private label had cut into the sale of equivalent national brands. Overall, the answer straddled the line between “no” and “yes, but not significantly.” Each response comprised 33% of the total. Retailers were slightly more inclined to favor “no” (33%), though “yes, but not significantly” was chosen by 27% of retail respondents and “yes, fairly significantly” was chosen by 24%.

Manufacturers tended to minimize the impact. Forty-one percent of this group chose each “no” and “yes, but not significantly.”

In a companion question related more to company branding, the industry was asked about nutrition rating and labeling programs such as Guiding Stars, NuVal and Smart Choices, to name but a few.

Almost three-quarters of total respondents said they do not participate in any such rating or guidance programs. The numbers were even more pronounced when broken out: 76% of retailers and 77% of manufacturers answered this question in the negative. This isn't to say that the respondents don't have shelf-labeling or any other guidance either in stores or on packages (in the case of manufacturers); but the answer does provide evidence that the industry is still far from reaching consensus on a common platform for health and wellness merchandising.

Special events and outreach initiatives also help differentiate one store from another, or one brand from a competitor. Health-check events were the No. 1 choice of both retailers and manufacturers when queried about the various elements employed in their corporate wellness umbrellas.

Among the more involved programs cited by specific respondents was the work performed by one company's standing health and wellness committee that sends out “weekly educational messages and promotes sporting events/leagues,” and another company that — perhaps generously, given the times — reimburses employees for health club memberships.

What do you see as the Top 3 wellness trends of 2009?

Gluten/allergen-free 46%
Certified organic 46%
Natural/organic private label 46%
Gluten/allergen-free 48%
Whole grains 46%
Certified organic 39%
NOTE: Multiple answers allowed.

Do you host a health & wellness page on your company website?

OVERALL 2009 2007
Yes 43% 38%
No 53% 60%
No answer 4% 2%
RETAILERS 2009 2007
Yes 51% 47%
No 46% 53%
No answer 3%
Yes 36% 39%
No 62% 60%
No answer 2% 1%
Healthy recipes 80%
Featured products 53%
Health condition links 53%
Dietitian columns 41%
Health blogs 27%

Do you stock or compete against a natural/organic/green private label?

Yes 52%
No 44%
No answer 4%
Yes 70%
No 27%
No answer 3%
Yes 52%
No 48%
No answer

About the poll

This year's WH Asks poll was conducted online by Penton Media from May 14 through 22. Analysis was based on 115 completed surveys. Fourteen percent described themselves as chain food retailers, 8% as independent food retailers, 7% as wholesalers, 38% as manufacturers, 11% as sales agencies and 20% as “other.” Two percent provided no answer.