The natural products industry has grown significantly over the past decade, causing its influence on the broader food manufacturing and consumer packaged goods landscape to expand as well. This consistent growth suggests that regardless of economic and geopolitical turmoil, the natural products industry will continue to thrive. Russell Reynolds Associates attended Expo West 2023, and identified some key takeaways below.
– Steve Noble
Senior partner at McKinsey & Company
Of the products that featured sustainability claims at the show, private brands were among the most popular. While specific claims do not necessarily drive consumers’ purchase decisions, the focus on sustainability shows the intersection between consumers wanting high-value products, and the need to make a difference with what they are purchasing. Many brands at Expo West put sustainability at the forefront of their products, from sourcing ingredients to animal welfare, with some even including sustainability callouts on their packaging.
– Scott Dicker
Director of market insights at SPINS
The gluten-free market is seeing price increases grow at a lower rate than other “better-for-you" categories. In the past, gluten-free options generally focused on the staples like shelf-stable grains and breads/cereals. However, consumers are starting to seek gluten-free products in new categories such as alcohol, supplements, pet treats, and more. Across categories, brands are seeing growth in this space.
– Penny Andino
Vice president of marketing at Justin's
At Expo West 2023, brands showcased their plant-based offerings that went beyond the stereotypical dairy and meat-alternative options. Multiple brands at Expo West introduced new candies that included low- or no-sugar claims, as well as plant-based formulas. Not only is the confectionary market expanding into plant-based options, but the seafood industry is as well. A majority of the total adult U.S. population is engaged with plant-based foods, which demonstrates the size and potential of the category1.
– Carlotta Mast
Senior vice president and market leader at New Hope Network
Many brands at Expo West unveiled new drinks that include additives meant to aid with gut health, including ingredients like chicory root fiber, agave inulin, Jerusalem artichoke, and apple cider vinegar.
– Nirmal Nair
Founder and CEO of Sempera Organics
Over the past few years, mushrooms have increasingly become a popular ingredient in a wide variety of products, from snacks to ready-to-drink (RTD) beverages. Mushrooms were found in many different forms at the Expo, including in jerky products promoted by Pan’s and Moku, as well as cutlets and steaks by Meati. A milk alternative created by Shroom Junkie was of the most innovative new uses of mushroom. Medicinal mushrooms also continue to rise in popularity in several beverage categories.
– Jessica Rubino
Vice president of content at New Hope Network
The distinct pivot toward embracing regenerative certifications and ingredients among brands isn’t just taking place among small, nimble start-ups. Now, larger companies are tapping into the trend as well. Simple Mills, a large brand with products ranging from cookies to pizza dough mix is one of the brands leading the charge into this facet of sustainability.
– Jessica Rubino
Vice president of content at New Hope Network
Though the future of the consumer packaged goods industry is unclear due to inflation and geopolitical tensions around the world, the innovation and expansion of product choices from Natural Products Expo West 2023 certainly bodes well for the year ahead.
Dana Dimitri is a senior member of Russell Reynolds Associates’ CPG practice. She is based in Chicago.
Andrew Hayes leads Russell Reynolds Associates’ CPG practice. He is jointly based in New York and Houston.
Amanda Johnson is a member of Russell Reynolds Associates’ Consumer sector Knowledge team. She is based in Dallas.
Sotiria Pericli is a member of Russell Reynolds Associates’ Consumer sector Knowledge team. She is based in New York.
1 Panel Recap: State of Plant-Based Series @ Expo West - Plant Based Foods Association