How Subscriptions Make The $30B Vitamin Market A Daily Ritual

For first-time shoppers, buying vitamins can be a little overwhelming. There are so many options, formulations and regimens, but not much in the way of hard data to tell one why they should take one over another. Vitamins may be a massive market in the U.S., but, for consumers, it is not a well-understood one.

A massive industry it is. On average, U.S. consumers spend a little more than $30 billion annually on vitamins and dietary supplements, and more than two-thirds of Americans report taking at least one vitamin supplement per day. While vitamins have been around for over a century, and popular in the U.S. since WWII, they have historically targeted older consumers (55 and up) — with 78 percent reportedly taking at least one vitamin supplement, and a little under one-third taking four or more daily.

In recent years, though, as the wellness and self-care movements have become an increasingly important retail force, the practice has become entrenched among younger consumers. As of 2017, about three-quarters of adults between the ages of 18 and 34 reported taking at least one vitamin supplement per day — up from around 65 percent in 2015.

Among the millennials entering the vitamin fold in early 2015 was Katerina Schneider, founder and CEO of Ritual, a direct-to-consumer digital vitamin company selling clear vitamin capsules out of clear glass bottles on subscription to consumers. Before becoming an entrepreneur, she was a venture partner at AF Square, expecting her first child and learning first-hand that prenatal vitamins were much more mysterious than expected. There were no ingredient lists to check, and no one in her life seemed able to give her much of a solid recommendation on what to take.

However, instead of getting discouraged, giving up and picking something with pleasant-looking packaging at random, Schneider found an expert, got into a lab and went about building a better vitamin, Ritual COO Liz Reifsnyder told PYMNTS.

“She hired a scientist with over 30 years [of] experience, and started from scratch with an explanation of why we even need vitamins, and started from there to formulate the first batch, with a vision to create a vitamin people could trust — make it simple, and make it transparent and traceable, so people know [what’s] in the product [and] why it was placed there,” Reifsnyder said.

A little under two years after that project was initiated, Ritual’s first product — a multivitamin for women — was released in late 2016. That was followed by its prenatal product in 2018, and a multivitamin for women over 50, post menopause, last fall. Yet, while the products are expanding, and Ritual is developing more ways to reach its customers (like a recently released Apple Watch app that allows users to track their daily vitamin intake), the firm’s focus has remained constant, and the expansions it pursues are all dedicated to that focus.

“The vision for Ritual and its products has always been about habits, and how do we elevate things from a routine — a habit to a ritual. The product is about long-term health,” Reifsnyder said, and leveraging the power of subscription commerce can help customers create the rituals necessary to pursue it.

Cutting Through the Clutter

There is no shortage of vitamin brands on the market. Some make rather remarkable claims about the ability to grow one’s hair an inch in a month, or double their energy and endurance. Ritual doesn’t believe in making those kinds of miraculous instant-cure claims, Reifsnyder said, since there is not a science out there to back it up. However, Ritual must exist in a market alongside those products, and find a way to reach consumers.

Ritual does that, largely, by cutting through the clutter, and making it easy for customers to simply know what they’re getting and why. The concept of multivitamins is not exotic, she noted, since more than half of all Americans take one already. Yet, the explosion of specialty products in the vitamin arena — the stress formula, the hair-and-nails formula, the sleep formula — hasn’t left consumers feeling enriched by the wealth of products.

“I think it has actually left a lot of health-conscious consumers a bit confused about what they need and how many pills they need to take, and finding just a single product looking to fill the gaps is refreshing,” Reifsnyder said.

Moreover, the design team has done a good job of creating a product that is “visually intriguing,” she added, with its clear capsule filled with bright yellow mini-capsules (that contain the vitamins within the product). The bright yellow, clear and white visual palette tends to draw customers’ eyes, particularly on Instagram, from which the brand’s earlier devotees have hailed — once they capture consumer interest, and get them to Ritual’s eCommerce site, the rich amount of data and products offered there “speak for themselves,” she said.

That includes ingredient pages that explain where the multivitamins were made, studies on the nutrients to explain why they are included and information on human clinical trials so customers can get an idea of the actual effects they can expect. That data breeds comfort with the product, and creates consumer willingness to interact with the brand over time. That is critical, since Ritual has pursued the subscription model — which, Reifsnyder noted, is ultimately the model most supportive of the brand, and how the multivitamins are ideally consumed by its customers.

The Essentially Supportive Subscription Model

The biggest challenge in the vitamin retail arena, Reifsnyder explained, is the difficult fact of customer non-compliance. They get started on a regimen, and fall off nearly as quickly. That means they are missing the real positive effects, because vitamins aren’t miracle pills that work overnight. They accumulate in the system and, over time, offer cumulative health benefits. Subscription is the ideal sales model for this product because that automated recurring sales process is a good fit for how Ritual wants consumers to use the multivitamins: on a recurring basis.

“The subscription is designed to more seamlessly build that habit, and I think to reflect that, this product is meant to be taken every day over a long period of time,” she said.

To further encourage that continuous relationship, there are many supports in place — from technical integrations with wearables like the Apple Watch to simple moves like making sure the vitamins actually taste good and are pleasant to take.

Moreover, Ritual continues to view its market broadly, and with more room for growth. While there is a tendency to associate the brand with millennials, she noted that the company doesn’t view itself that way — which is why it released a formulation for menopausal women last year. The point isn’t about bringing vitamins to targets, but building a women’s health brand that makes getting a transparent vitamin product easily accessible for anyone.

“I think the brand spans generations,” she said. “The 55-plus audience is our fastest-growing by far, and it is really exciting, and where the simplicity of the message really resonates across generations.”

Long-term health isn’t a generational goal — it’s common to all women. Ritual hopes to help women get there, and better understand the path they are taking.