The natural products space has experienced a lot of growth in the last few years. However, there has been a recent slowdown, leading to questions of whether the market has cooled off.
Natural products entrepreneur and industry leader, Ryan Dean Hoggan, in this interview, gives insights into the future of the industry.
Is the industry just a passing fad? What customers should you serve? These and more are answered in this short, but impactful interview.
Is the natural products trend a passing fad?
Absolutely not! The natural products industry is here to stay. People are getting more conscious about their health, and they have realized natural products are a way to enhance their health.
Also, we are getting conscious of the environment, our place in it and what we can do to protect it. Since natural products are largely climate-friendly, they are getting attention, especially in regulatory circles.
Thus, the natural products market can only grow bigger. In fact, I’m quite optimistic of its prospects in the short to mid-term.
Which customer segment of the market should be focused on?
Just like with every other industry, it is very important to understand the market and its needs before spending efforts and resources on product development. To generate this understanding, you may need to do market or customer segmentation.
If you apply this to the natural products market, you will discover that generally, females are the heavy-spending customer segment in this market. However, when you want to narrow things down, the type of product you want to sell or promote will depend on which purpose it serves.
If you are talking about natural sexual enhancers, then the male population is the target. But if you are building natural cosmetics, then females are the obvious targets.
Which model of distribution will win in the natural products industry?
In recent years, we have seen the fast growth of the direct-to-customer (D2C) distribution model. This model has proven to be quite successful.
We have also seen how many brands have made popular the art of cutting the middleman away. Yet, despite the barrage of criticisms and naysaying, they have grown widely successful with attractive valuation.
So, if you ask me, I’d say I’ll opt for the D2C as against the mass-market, retail model. There are a lot of benefits to both the business and customers.
For the business, they can interact directly with the customer and get live feedback and also have access to valuable data. While for the customer, there is reduced last-mile cost.
Additionally, D2C will particularly grow exponentially in the natural products space, because of the personalization involved. We should also look at affiliate and other incentive-based channels of distribution.
How can prospective entrepreneurs venture into the natural products industry?
This is quite an interesting question. There is no perfect way to do so, but there are some general pieces of advice.
For one, note that the market is highly saturated already, and there are still many players coming onboard. Also, junk food producers and chemical-based cosmetics makers might also switch. So, prepare for a lot of Competition.
However, market saturation should never discourage you. Search for unsolved problems and unfilled needs in this space and develop products to fill them.
What form of marketing is the best for natural products?
There is no perfect form of marketing for natural products. However, there are some effective ideas. It is generally agreed that online is where to be, so ensure you are there.
While online, you can exploit different channels, of which workable ideas include YouTube and Instagram influencers. Also, properly channeled content marketing is effective.
Additionally, you can mix marketing with distribution, for instance, via affiliate or multi-level marketing channels.
The natural products industry is an emerging space, and one you should be part of. These high-level insights from Ryan Dean Hoggan will definitely prove helpful.