Typically when you think nutraceuticals, you think high-end ingredients, added value and important R&D investments, which all lead to higher prices and premium products. But with a negative economic environment and nutraceuticals trying to become more mainstream, there is a large demand for more affordable alternatives. The demand comes from both existing users looking for more budget-friendly options and from new users looking to take their first steps in nutraceuticals consumption.
 
Private label products have a 5% value share of overall health and wellness soft drinks globally, and less than 2% for fortified/functional soft drinks (but 9.5% in Western Europe!). There is a clear polarisation of the offer from highly added-value products to the other end of the spectrum with private label. But private label does not always have to mean basic. What started as discount products sold in basic outlets are now increasingly being developed and sold by higher end retailers. Supermarkets-hypermarkets are pushing their ranges, looking at more mid-priced positioning and re-enforcing the innovation and quality values of their product lines.
 
Here are some examples of private label around the world, more or less innovative…
 
Switzerland-Migros-Actilife

Actilife is an extensive range of nutraceuticals products, including dietary supplements (from specific like eye supplement for senior, to children, women and general wellbeing), nutraceuticals beverages (Actilife Antioxidants and Actilife Vital) and food (wheat germ, margarine, breakfast cereals…).
 
The range was created at the end of the 1990s and was re-launched as a comprehensive health and wellness program in 2007 to offer a more holistic approach to a healthy lifestyle in one of the main grocery retailers in Switzerland. Actilife is extremely well positioned as a high-end, value-added product. Consumption of Actilife products, such as Omega 3 drink is as much a statement as drinking a branded equivalent. What’s more interesting is that the product is not just a pale copycat of existing beverages—it has an image recognition of its own. Its unit price is also in the average for the category (between US$2.20-2.50/litre for a fortified juice drink like Actilife Beauty or Actilife Omega 3).
 
Italy-Coop-Bene-Si’

Bene-Si’ is a range of nutraceutical food and drinks launched in 2010. The range has stronger private label characteristics compared with Migros’ Actilife, with the name of the retailer more visible on the front of the packaging. However, the range makes a big effort to make fortified food and drink more accessible for everyone, not just with lower price and wider availability, but also by providing simple guidelines and educational tools on the packaging.
 
Each product clearly advertises the health benefit (e.g., digestion, antioxidant, bone health, cholesterol, etc.) but keeps it simple by promoting it as an added-value benefit instead of the only reason to buy the product. “It’s a cookie that happens to contain extra fibre and will help my digestion.” As a result, it is a great introduction to functional food and beverages for consumers who never tried them, and is also a plausible alternative for consumers already interested in health and wellness but seeking cheaper products.
 
South Africa-Woolworth-Woolworth Plus

Copycat of Glacéau VitaminWater Zero, Woolworth launched a range of similar products in October 2011, aptly named Woolworth Plus. This is a typical private label product, a me-too of an existing brand where the only added value is the lower price (a bit less than 20% cheaper). The lack of innovation is not surprising as “nutraceuticals” are still limited in South Africa. But this indicates potential for future development of private label.
 
South Korea-Lotte Group

Lotte Group is one of the main Korean chaebols (i.e., family-controlled, government-assisted, multinational conglomerates. Other Korean chaebols include Samsung, LG and Hyundai). Lotte’s activities include (but are not limited to) retailing, foodservice, hotel, leisure parks, confectionery and also beverages.
 
Lotte beverage products are sold in Lotte Mart retail outlets as well as other channels, making it a special mix between private label and brand. Looking at its beverage range the company is increasingly switching its positioning from “budget value” to “quality value” in order to attract health and wellness consumers. Products range from copycats (e.g., Daily-C vitamin water which is a knock-off of Glacéau VitaminWater) to more original product development including 2% DBH, the leading flavored bottled water brand.