That was a warning from Simon Jurkiw, Bulk’s Product Director, speaking at NutraIngredients’ Sports & Active Nutrition Summit (SANS) in Amsterdam earlier this month (October 5-7).
His presentation detailed how the consumer base of sports nutrition has evolved over the past two decades.
“The gradual change I see, certainly in the UK and Europe, was Maximuscle investing heavily across categories and trying to reach a wider audience … their overall The focus was on education, a bit of a game changer at the time.na
“Some of the images they used in their marketing were unprecedented at the time. For example, the images of climbers were completely different from anything seen before.”na
In the 2010s, larger brands such as MyProtein and Bulk entered categories with nondescript packaging, images, and claims that made their products more accessible to a wider audience.
All efforts to “normalize” the industry have certainly paid off.
Jurkiw told attendees that in 2010, about 80% of Bulk’s range was focused on muscle and weight loss, but with more emphasis on health and food, the brand is now virtually muscle-centric. said it has changed to one-third of the Health conscious and diet.
“It’s completely normal these days to use a shaker on a tube. If I had done it 15 years ago, I would have made a pretty funny face.” It used to be how to explain what it is, but now it’s easy because we know the product, the efficacy and the market. na
“There are protein bars everywhere you look. Everywhere you look there are protein bars.”na
He explained that all this market diversification means that brands will start creating more targeted products, making personalization very important and giving online brands an edge.
He added that this more concrete opportunity can be seen as an exciting one for many brands, adding: “For example, there are some incredibly successful brands just for CrossFit, and a variety of other sports that fit into it.”na
And of course, the plant-based trend offers great opportunities for innovation. Bulk protein mixes, which used to be 95% whey and 5% vegan, are now split between 65% whey and 35% vegan, Jurkiw explained.
He added that the search term customers increasingly use is “botanical” rather than “vegan,” and brands market their products accordingly.
acquisition cost or lifetime value
But while there has been a great deal of focus on trying to expand the market, Jurkiw warns that it’s not always so simple, under the assumption that a wider market equates to larger returns. .
“The thing to watch out for is the customer lifetime value (LTV), which is very important. The lifetime value of a muscle customer is pretty high as long as the product is good. It could be slightly higher. Customer Acquisition Cost (CAC), but overall CACLTV is pretty good.na
“Lifestyle-focused customers may be on the fringes of the category and may have lower acquisition costs, but may not have as good a lifetime value. na
“A word of caution when looking at the overall economics of a business. You may find that your financial situation doesn’t stack up, so it’s not as simple as just saying ‘Let’s take it all.’na
“If you’re making the big shift from building muscle to lifestyle, I think that’s a big risk because you risk losing your existing income.”na
economic challenges
He went on to discuss some of the very difficult macroeconomic issues in the industry today.
“It’s a pretty tough gig at the moment. There’s a lot going against us.” na
He said he struggled to find any positives Brexit has brought to UK businesses, leading to issues such as border controls, labor costs, recruitment issues, additional paperwork, raw material costs and bank charges. pointed out that
Speaking about COVID, he found one positive: it has led to increased sales of high-margin products such as vitamins and minerals.
But after all gyms closed, the high lifetime value customer, the gym-obsessed customer, wasn’t as active in the market during that period.
And perhaps the biggest challenger across the board, Jurcue said: “Inflation has also hit many businesses across Europe, with their gross margins at record lows even though customers are being asked to spend more than ever before. ”na
All of these issues lead to increased costs of doing business.
“Despite all these challenges, growth is still possible and we are lucky to experience it in a pretty strong way. and an almost forensic plan for cash flow.”na
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