The Amazon Effect on Supplements

May 2, 2018

While Amazon began by selling books, the impact the corporation has on the economic market now effects almost every consumer and business segment in some capacity. Amazon sells diapers and coffins and just about everything one can want in between. If Amazon doesn’t sell it now, it is rumored they’ll start soon, as is the case of pharmaceuticals. On April 2, 2018, the Dow Jones Industrial Average dropped almost 500 points and almost 3.5% on the concern a trade war with China would have on Amazon. Amazon’s influence on the world economy is undisputed.

Amazon’s influence on the supplement industry has become even more impactful as the rate at which the market giant is gobbling share is unprecedented and seems without constraint. A recent report from Slice Intelligence indicates the vitamin and supplement category is outpacing other e-commerce categories. This same Slice report indicates U.S. vitamin and supplement ecommerce sales grew 40% in 2016 and at a 12 percent faster rate than the general ecommerce market. According to a 2017 Slice Intelligence survey of U.S. shoppers, Amazon accounts for 77% of all U.S. vitamin and supplement sales made online. The remainder of the vitamin and supplement ecommerce sales are almost entirely divided by vitamin and supplement specialized sellers such as VitaCost, Swanson, Puritan’s Pride and iHerb. The two largest brick and mortar vitamin and supplement retailers, GNC and Vitamin Shoppe combined receive approximately 2.3% of the total ecommerce market in their category, further underscoring the emergence and impact of the Amazon effect.

Another aspect of the Amazon effect is the product offering the providers carry. The more involved the platform vetting process, logically, the fewer brands are offered. Amazon is the demonstrated leader in the market offerings with over 13,000. The range of brands being carried among those that platforms that promote multiple brands is 36 to 13,152.

Platforms that responded to our request for details on their onboarding process mentioned or provided a vetting process. Amazon directed us to a terms and conditions page specifying the 5 requirements to sell dietary supplements on Amazon: Amazon Seller Central Dietary Supplements

These are:

  1. Name of the dietary supplement
  2. The net quantity or amount of the dietary supplement
  3. Nutrition labeling
  4. The ingredient list
  5. The name and place of business of the manufacturer, packer, or distributor

Additionally, Amazon commented:

“According to our Terms & Conditions, which are valid for all third-party sellers selling on Amazon, it is not allowed to offer products that are violating legal provisions. If we get notified about specific products, we will immediately review and, if confirmed, remove items as well as approach our sellers to secure compliance with our T&Cs.”

Included on the Terms and Conditions included on the Seller Central Page is a listing of 23 prohibited listing categories and a list of banned products and ingredients numbering 1,391. Product names on the list include a ‘hall of shame’ of FDA blocked ingredients and products including Ephedra, steroids and Sibutramine. One curious note on the “prohibited” products listing was the inclusion of a handful of Walmart Spring Valley and Walgreens products including Echinacea, St. Johns Wort, Garlic, Gingko Biloba and Saw Palmetto. All of the Walmart Spring Valley and Walgreens banned ingredients are sold by other brands including Nature’s Bounty, the manufacturer of Walmart Spring Valley products.

It is clear Amazon has some vetting criteria but it is inconsistent and completely reactive to some undefined impetus from the marketplace. A responsible vetting process would be both proactive and well defined. It is that vetting process the Trust Transparency Center seeks to assist the ecommerce segment of the industry to implement. Stay tuned to this site for more information on this topic.

The Amazon effect is immense across all areas of the U.S. marketplace. The Amazon effect is even more impactful on the U.S. dietary supplement market. The likelihood this effect will diminish any time soon is not high but it is important that we continue to monitor the impact on the industry. Trust Transparency Center is committed to keeping a watchful eye on all effects in the marketplace that cause us nervousness, including the Amazon Effect. We will continue to maintain our vigilance. See you next Tuesday for our next Trust Talk!

~Scott

Unlock the Power of Transparency: Schedule a Meeting Now

Ready to Illuminate Your Path?
Partner with Trust Transparency Today.

Get inTouch

Lori Diez

Lori Diez combines compassion and excellence to lead organizations to their next level. A small-town Texas childhood taught her the value of hard work and relationships, which she uses to foster teamwork that brings results that have transformed cultures and programs to their highest potential. Her successful career in pharmaceutical and nutraceutical sales leadership and event hosting has prepared her to deliver results as the COO of TrustTransparency, where she uses her industry knowledge to ensure that the company’s operations run smoothly as they support nutraceutical companies in their mission to help others. Lori’s passion for charity reflects her belief that individuals working together can change the world, no matter how small their contribution to the effort. This year, she looks forward to continuing over a decade of service at the Houston Livestock Show And Rodeo, where she will be the Chairman of the Livestock Committee.

Conference Handouts

Conference Handouts

CoQ10 Statin Associated Myaglia Meta Study Barry Tan 0618 Case Study

CoQ10 Statin Associated Myaglia Meta Study Barry Tan 0618 (1)

Statin Q10 Effect Case Study

Statin Q10 Effect Case Study

Schedule Consultation with Trust Transparency

Glynnda Steinford

Glynnda Steinford, Trust Transparency Consulting’s Director of Customer Relations, brings over four decades of healthcare experience to her vital role in client engagement and relationship building. Her diverse background spans from administering medical groups to impactful stints in pharmaceutical and nutraceutical sales, all underlined by her degree in Healthcare Administration.

At the heart of Glynnda’s work is her talent for nurturing long-term connections, a skill she leverages to enhance client experiences and partnerships within the consultancy. Beyond her professional commitments, she enjoys life’s simple pleasures, whether it’s her love for cats and cooking or her ventures into golf, always prioritizing cherished moments with family and friends. Her personal interests echo the dedication and warmth she extends in her professional network, making her an invaluable asset to the team.

Caiti Dowden

Caiti Dowden stands as a crucial pillar at Trust Transparency Consulting, bringing invaluable insight and expertise to her role as Senior Executive Assistant’ since her start in 2018. With an academic background from Sam Houston University and a career shift from education to the nutraceutical sphere in 2010, Caiti has cultivated a sharp acumen for dissecting industry trends and bolstering strategic decision-making.

Her transition from Data Analyst reflects her growth and deep understanding of the business landscape. Caiti’s commitment goes beyond professional excellence; she thrives on balance, drawing from her rich life outside of work to enhance her organizational contributions. Whether it’s family time, volunteering, or rooting for Houston’s sports teams, she believes in embracing experiences to fuel her professional creativity and insight.

In her current role, Caiti’s dedication to dynamic business analysis and operational support proves her to be an irreplaceable asset to our team, embodying the synergy of personal enrichment and professional success.

Pam Hilpert

Pam Hilpert, Chief of Staff at Trust Transparency Consulting, has been instrumental in the firm since its inception, leveraging her 17 years of accounting experience, including a significant tenure in the nutrition sector. Her collaboration with Scott Steinford spans various successful ventures, emphasizing her integral role in the company’s financial and strategic initiatives.

An alumnus of Sam Houston State University, Pam holds degrees in both Business Administration and Accounting, as well as an MBA, adding academic heft to her practical industry insights. Beyond her professional prowess, Pam is passionate about family, enjoys live music, delves into quilting, and volunteers at her church, reflecting her well-rounded life.

Her multifaceted expertise and longstanding dedication make Pam a cornerstone of Trust Transparency Consulting’s operational strength and team unity.

Scott Steinford

Scott Steinford, a trailblazer in strategic leadership, boasts a certified M&A background, having navigated companies from their genesis to industry prominence. His brainchild, Trust Transparency Consulting, born in 2007, stands as a testament to his dedication to ethical business practices and strategic foresight, offering industry stakeholders invaluable guidance.

Beyond founding and steering companies, Scott has enriched the business landscape with his insightful keynotes and prolific written contributions, emphasizing his commitment to elevating industry standards. His executive tenure shines in roles as CEO or President of for-profits like ZMC-USA and Doctor’s Best, extending to significant contributions in non-profit sectors.

Notably, Scott’s influence is a driving force in the CoQ10 market, where his leadership has significantly bolstered the ingredient’s global presence. His roles in various capacities, including as a New Hope Ambassador, keep the community informed, providing in-depth industry reports and insights.

An active advocate within professional associations and an Editorial Advisor for leading industry publications, Scott’s expertise is both recognized and sought after. With academic roots in Pre-Law and a Master’s in Law, his journey transcends textbooks, embodying real-world business acumen and transformative leadership.

Scott Steinford merges visionary entrepreneurship with principled leadership, creating a legacy of innovation, growth, and unwavering commitment to industry excellence.