On August 27, 2018, Sharon Leite officially took over the role of CEO at The Vitamin Shoppe. How has she done in my opinion? Firstly, I'll transport us back in time, so we can get a sense of what was happening at The Vitamin Shoppe when we took over the job. The peak revenue and store count era was in 2016, but cracks quickly began to show at The Vitamin Shoppe (and GNC), as they struggled to compete with Amazon, changing consumer expectations with shopping experiences, and the dissemination of the supplement category. So, when Sharon got hired, things were quickly trending negatively externally but also inside The Vitamin Shoppe…with a customer base that hadn’t grown much in years, lack of innovation culture, poor execution in every department, and an inability to evolve with the swift landscape. This was a wakeup call for change, and I remember that first real earnings conference call where Sharon laid out her plan of action. So, that’s what I’m going to judge her against…did she follow through with her transformation plan or not? Additionally, I will update you on the recent business performance for The Vitamin Shoppe. I'll utilize the 2022 Q3 Franchise Group (NASDAQ: FRG) earnings report and conference call to provide quarterly segment-level financial details for The Vitamin Shoppe. I will also dig deeper into several areas of The Vitamin Shoppe, such as franchising activity and merchandising category trends.

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Even with the gut health revolution in full swing across the CPG industry, most consumers still have a knowledge gap, but that might actually end up creating a double-edged sword effect on categorical growth. Gut health has become such a well-known trend within the food, beverage, and supplement CPG categories…bringing with it tons of new market growth and product development. (Note: I’ll cover some of that trending gut health CPG product and brand development later in the content.) But it’s natural to assume then that all this positive market activity also greatly improved consumer education, right? There’s little doubt in my mind that consumers are certainly more aware and educated than ever about gut health, but even I get frequently tripped up with the ever-evolving information and gaps in knowledge that it creates about the topic. I think it’s that consistent newness of information, and knowledge gap that it creates, which forms a paradoxical relationship with the expected massive categorical growth. In this content, I'll dive into the difference between consumer intent around gut-related conditions and gut health benefits. Additionally, the importance of the gut health ecosystem to educate consumers on the difference between various probiotic strains, or how prebiotics, probiotics, and postbiotics function differently. Also, how CPG brands must take an integrated approach to product marketing that meets the consumer where they are at…in a way that breaks down scientific findings into easy-to-understand nuggets of information. Finally, I share the importance of gut health thought leaders (influencers) and talk shop with Matt Titlow, CEO of Compound Solutions, which is the supplier of the popular gut health ingredient CoreBiome about his unique perspective on gut health within the context of the emerging CPG intersections of food, beverage, and nutritional supplements.

Compound Solutions CoreBiome Information

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I figured out the secret behind Quest Nutrition’s product innovation strategy and let’s just say they could easily be a headlining DJ at some of the biggest music festivals in the world. In this latest episode, I'll utilize the 2022 Q4 Simply Good Foods Company (NASDAQ: SMPL) earnings report, earnings call, and supplemental presentations that were filed on 10/21/2022 as the backdrop to provide broad nutritional snacking market insights. In Q4 of fiscal 2022, both brands had outperformed their average peers in retail takeaway growth, with Quest Nutrition specifically having slightly less than 25% growth. Quest Nutrition is a monster right now. The brand’s core bar business is growing. It’s on a roll from a distribution standpoint and recent innovations have been performing well. But it’s that late point that I want to focus on because the Quest Nutrition innovation pipeline has been strong throughout the last few years and leadership on the earnings call alerted us that it remains robust. So, what does Quest Nutrition have up it's sleeve next? In today’s business world, it’s hard to come up with an original thought. Once you acknowledge that, you start seeing things through a remix-filled point of view. Quest Nutrition is essentially Kanye West back in his doing 5 beats a day for 3 summers era. To put it another way…Quest Nutrition is DJ Khaled yelling at live performance in the 90s with the Terror Squad. What the heck am I talking about? The secret behind Quest Nutrition’s current innovation streak is rooted in remixing the past…its own past, well before most of its fans today knew about the brand.

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Pivotal is an interview-style segment that tackles topics in consumer packaged goods (CPG) and fast moving consumer goods (FMCG) from the business leaders that live it EVERY DAY! Many of you might know that I worked at MusclePharm in the early 2010s. This was during a time when that sports nutrition brand had literally caught lightning in a bottle. Either you had that big obnoxiously bright lime green MP in your kitchen cabinet, or you weren’t cool…it was as simple as that. More than a decade later, I look back at my last official employer before betting on myself with J. Schall Consulting as this invaluable foundational experience that I wouldn’t chance for anything. But few know that I left MusclePharm with a bad taste in my mouth. My guest on this episode is one of those people because he was the Co-Founder of MusclePharm. While Cory Gregory and I obviously chop it up about those MusclePharm days, we also talk about his crazy origin story that started underground as a coal miner. Additionally, we talk about how Cory was ahead of the curve on a lot of content and influencer marketing strategies used today and he explains why decades of consistent hard work honing his craft has led to generating several different million-dollar revenue streams. These are just some of the interesting topics we chatted about in this episode... 

Cory Gregory Instagram

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Bang Energy just filed for Chapter 11 bankruptcy…which likely makes you feel a certain type of way, but I’m here to sidestep any of that emotional BS and explain what’s really going on at the empire that Jack Owoc built. So, my assumption is that the Bang Energy bankruptcy is causing such an outcry of commentary because of the combination of either (1) you like/dislike Bang Energy CEO Jack Owoc (2) you like/dislike the Bang Energy energy drink or brand (3) misunderstanding of bankruptcy. Well…I read most of those I think 75+ court documents that amounted to more than 1000 pages in hopes that I can provide facts on the Bang Energy bankruptcy and breakdown what everything ultimately means for the company and the entire energy drinks market. Will Bang Energy be going out of business or sold through the bankruptcy process, maybe...but not until at least early 2023. I'll explain the rise of VPX Sports (parent company of Bang Energy), how the "Bang Energy Effect" disrupted the energy drinks market, and how things fell a part and might never go back to the early 2020 days. Finally, I explain the implications of the Vital Pharmaceuticals (VPX Sports) Chapter 11 bankruptcy to the energy drinks market, Jack Owoc, and Bang Energy.

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We all know that the energy drinks market has been crazy these last few years. What if I told you though that I’ve got some mega merger speculation, that if it comes to fruition, would take things up a million notches on the craziness scale? What business highlights in the energy drink market have made things crazy? While the Keurig Dr Pepper (KDP) announcement that it had entered a strategic partnership with Red Bull to distribute the energy drink in the Mexican market is important, it's something new KDP CEO Ozan Dokmecioglu said in the press release that raised speculation in my eyes to a possible bigger transaction in the future…and by bigger transaction, I mean a mega merger! Can the JAB Holding Company (biggest shareholder in KDP) pull off another huge M&A transaction? Finally, I explain the power of this new combined company that will own two-thirds of the "energy everything" category and would create distribution, sales, and marketing synergies.

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This week, I attended the National Association of Convenience Stores (NACS) Show 2022 in Las Vegas. While my main purpose was to meet with old and new CPG industry friends, I did notice a handful of convenience store CPG trends that I wanted to share with you. These trends include: (1) technology and electrification of vehicles is disrupting convenience retailing (2) energy drinks passing of the guard (3) "energy everything" is thriving (4) alcoholic and non-alcoholic beverage is converging fast (5) Smaller Indulgences Are Reigning Supreme.

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After three years of basically nothing…can I get 'Things that Baffle Me' for $1000 Alex? I know any event before 2020 feels like a generation ago so maybe you forget that The Hershey Company acquired ONE Brands (maker of the ONE bar) in August 2019 for $397 million. To get yourself back in that late-summer of 2019 blissful mindset even deeper, just a week earlier than the Hershey and ONE Brands news, it was also announced that The Simply Good Foods Company acquired Quest Nutrition for one billion dollars. So, in that extremely short stretch of time, two of the most buzzworthy bar brands, positioned inside the high protein, low sugar world, were acquired. Being a protein bar company in the summer of 2019 was one of the most valuable things you could be in the growing functional food space...that is until it wasn’t! So, why would Hershey’s want to buy ONE Brands? Well…it’s part reinvention of its public perception but mostly an internal hedging process. Despite Hershey’s having no intention of completely diverging from its core business of indulgent sweets, the ONE Brands acquisition folded in quite nicely because its core product the ONE bar was an indulgent-yet-healthy-food. I'll run through why I give Hershey's (and the Amplify Snack Brands division) a pass on not meeting the ONE Brands platform brand strategy ambition level, but also explain why I'm frustrated they're letting Quest Nutrition absolutely crush them in product formats (e.g. peanut butter cups) that are core competencies with the ownership of iconic candy brands like Reese's.

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Remember the good ole’ days when health experts predicting an upcoming bad cold and flu season was the biggest worry to our immune health? Because of recency bias, it’s likely hard for most of us to detach the rise in consciousness around immune health from the last 2.5 years. Surprisingly though, if you look back to consumer health surveys from late-2019, immune system support was still a top priority. The cold, flu, and immunity market became arguably the most important topic of interest in 2020. According to the Nutrition Business Journal, that condition-specific supplements category grew at a staggering 72.3% YoY. What was once a seasonality fueled $3.4 billion supplement category, now transformed into a constant year-long pursuit that added more than $2 billion in incremental consumer spending. Even without mentioning those growth metrics, any CPG industry professional with their eyes open intuitively knew that the cold, flu, and immunity supplement market skyrocketed in 2020. That being said, what happens to the long-term outlook of the immune health CPG category after a demand pullback in 2021 and 2022? Are consumers less interested in immune health...making it a dying category? I'll breakdown a few things at play here (changing consumer health attitudes, rise in immune health functional foods and beverages and consumer skepticism). Finally, I discuss what opportunities push the immune health category growth even further in the future.

This content was supported by Compound Solutions. If you’re interested in attaining more information about CoreBiome or any of the other unique, science-backed ingredients supplied by Compound Solutions, head over to www.CompoundSolutions.com or reach out to me directly and I’ll connect you with the relevant team member.

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I proclaimed something about MyProtein last year, but will overlooking a core brand positioning element end up making me look wrong? On September 15, 2022, THG (formerly known as The Hut Group) updated the public markets by releasing its 2022 first half earnings report. I’ll be utilizing that financial information, along with the earnings call commentary and any relevant publicly disclosed information to obviously update you on the recent performance of THG and specifically the THG Nutrition division that includes MyProtein, but also synthesize everything to provide relevant insights about the global sports and active nutrition markets. While my focus will be primarily on the THG Nutrition division that houses MyProtein, MyVegan, MyVitamins, and others, I will also cover important information about THG Ingenuity and THG Beauty (including the change of plans around the Softbank investment). THG Nutrition divisional revenue for the first half of 2022 was just over $405 million…growing only at 3.3% YoY. I explain why that growth rate was so low compared to its major competitor Glanbia Performance Nutrition, along with THG Nutrition's current growth strategy, and why MyProtein could be an acquisition target.

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