Vitamin Shoppe CEO: ‘Fish oil will turn around a little bit based upon some of the things that we’re seeing’
Negative press in the fish oil sector linked to a 2012 meta-analysis questioning the efficacy of omega-3s for heart health and followed by 2013’s controversial prostate cancer study have been linked to a ‘decline’ in the omega-3 sector, according to data from Nielsen and analysed by GOED. This has resulted in a loss of 12 million omega-3 consumers, said GOED.
In a conference call with investors to discuss Vitamin Shoppe’s Q1 results, CEO Tony Truesdale said: “We get good press and we get bad press and we cycle through both of those on a regular basis. So there’s nothing that we’ve seen since probably December that would put me in a position to say that it’s slanted to the negative side at this point in time.
“Remember it was July 10th, 11th, and 12th of last year when we had three different articles, one Times Magazine, Forbes and The Wall Street Journal that came out. So we’re going to cycle that coming in July and I believe that fish oil will turn around a little bit based upon some of the things that we’re seeing. So we’re hoping that will be the case.”
Brenda Galgano, Vitamin Shoppe’s CFO, added that fish oil represents less that 5% of the company’s business, which would diminish the effects of any decline. “We have 8000 SKUs in our stores and 20,000 online. We are truly a diversified business and there’s not one single category like a fish oil that I would say is a significant part of our business.”
Multivitamins
Bad press has not been limited to fish oil, however, with multivitamins also taking a hit. “You had three articles,” said Truesdale, “two or three on December 17th, again it was Time Magazine, Los Angeles Times and FOX Business News that had articles that were negative on multis, and we’re still in the process of it – it usually takes a year to kind of cycle through those. But it’ll get better the farther away from the article that you are. So I think both of those will improve over time.”
Financials
The retailer enjoyed a 10% year-over-year increase in store sales, with e-commerce revenues increasing 17% in the quarter. Super Supplements contributed about 2% to that growth, added Galgano.
In terms of category performance, sports nutrition, on the go, and natural bath and beauty were mentioned as good performers in Q1 for the company.
Truesdale said that the company is also adding an electronic device range called Fitness Tech of activity trackers, heart rate monitors, fitness-specific watches. “The first 16 SKUs are already available online and we will be testing a range in 60 stores beginning next month,” he said.
