KeHE and SPINS Shared Insights on 2025 Trends in Our Sold-Out Webinar

KeHE is the leading distributor of natural products in North America. SPINS is the premier source of data and insights about natural product sales. Who better, then, to lead our December 17 webinar, Early Look: Growth and Disruption in 2025 Trends, than these two Naturally Chicago co-founders.

Our Naturally Chicago community clearly agreed, as our final webinar of the year hit its 500-registrant Zoom capacity, with another 80 interested parties joining the waitlist in order to receive the webinar recording in an expedited fashion.

For an hour of their valuable time, they received a master class on where the industry is heading from these experts:

• Hannah Law, Chief of Staff and Senior Vice President of Corporate Strategy & Communications, SPINS (who served as moderator)

• Kathryn A. Peters, Head of Industry Relations, SPINS

• Marc Nehring, Senior Director of Growth Solutions, KeHE

The following are key takeaways from the discussion. There is a link at the bottom if you would like to view the full webinar recording.

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The conversation among these peers was divided into four sections:

State of the Industry

Law kicked off this conversation by noting, “The end of 2024 is a good time to look back and see where the natural products industry is, what the growth trajectory is looking like, and how this remarkable community and ecosystem is coming together.”

The good news is that all panelists agreed that the state of the industry is strong. “The industry is continuing to gain strength throughout this year. Virtually every indicator we want, dollars, units, channels, new consumers,” Peters said.

Referring to the fraught period during and coming out of the COVID pandemic, Peters said, “It's just really clear that, once again, this industry has shown incredible resilience. We saw it in previous challenging economic times, and it's proven through once again.”

Nehring noted that sales in the Natural channel (meaning retailers that are focused on natural products) were up a hefty 6.6 percent — and natural product sales were also up 4.4 percent in conventional grocery chain (known as MULO for Multi-Outlet) and by 5 percent even in convenience stores.

Law noted that the steady growth in the natural sector was occurring even as change and innovation are constant factors. “That you can have growth and innovation at the same time is really remarkable,” she said.

There was a discussion about the status of “plant-based,” a category that overall has stepped back a bit after years of rapid growth. While there is a widespread perception that this sector is in a slump, Nehring stated that it is not across the board. While noting that plant-based meat alternatives are down from their peak in 2020, he said other product areas, such as supplements, plant-based yogurts, and coconut milk, are growing quite well.

Preferences with Staying Power

The discussion then turned to looking forward to 2025 and beyond, starting with current preferences that the panelists view as having staying power.

Peters provided a framework by noting that the natural products industry benefits from the increase in the number of “conscious consumers” who wanted choices that reflect their values.

“These informed choices that are just so overwhelming in today's marketplace that supports the preferences that consumers want to be in control,” she said. “They want to have the power to make their own decisions, and they want to have the right kind of information to make the choices that's right for them.”

Aging well has emerged as a major priority among consumers. Nehring outlined KeHE’s analysis that showed consumers with this focus are seeking products that emphasize gut health, high protein, functional ingredients, fiber, weight management and personalized nutrition.

Peters followed up by noting that the rising interest in “food as medicine” puts what we eat in the context of other life-extending lifestyle changes.

“There's so many different areas that are about how we live these healthy lives longer so we can keep active and on the move,” she said. “And it's about this really holistic rethinking of the role that food and nutrition plays in our lives, alongside things like sleep and moving our body and time and nature and all those things.”

Law then shifted the conversation to what stands out as the most talked-about diet-related topic of 2024: the explosive growth in the use of GLP-1 medications such as Ozempic and Wegovy — created to treat diabetes — as weight-loss treatments to address obesity.

Law described the phenomenon as “really changing the face of how people eat, their relationship with food.” (There is early evidence that, for at least some people, GLP-1 drugs render the foods that contributed to their weight problems as no longer a craving, or even unappetizing.)

Citing the statistic that 15 percent of those managing their weight are using GLP-1 treatments, Nehring stated that this could have a dramatic impact in the marketplace.

“We're eating less calories per day, so each of those bites really counts. So that's either fewer calories per meal or fewer meals throughout the day,” he said. He added that food producers will need to adjust to a higher demand for healthier foods that are high in protein and fiber and much lower in sugar.

Nehring pointed to Big Food giant Conagra, which has added a “GLP-1 Friendly” label to some of its Healthy Choice product line.

The Art & Science of Being Ready

The almost overnight and seismic impact of the GLP-1 phenomenon underscores the need for producers to show agility and preparation in addressing changing consumer preferences.

“I often like to think about innovation as sort of both the art and the science of being ready, ready for what consumers are going to ask for. Sometimes that is deeply data driven. Sometimes that is a little bit more sort of a gut feeling,” Law said.

Peters said, “ I think it is really critical that brands and retailers stay in step with today's really self-centric, value-related consumer. The pace of change is faster than ever.”

Nehring then outlined the top five categories KeHE’s Innovation Index for 2024:

• Energy and Sports Drinks

• Refrigerated Plant-Based Milk

• Cold Cereal

• Wellness and Snack Bars

• Frozen Breakfast Food

Law asked the panelists for their view about sustainability, another fast-rising priority among packaged goods purchasers.

“Sustainability is incredibly important in the minds of consumer, but there are other things that are still often coming first in their buying point,” Peters said. “Just the reality of whether it's budgets, whether it's a health component that I'm looking for… how it tastes.”"

“That being said,” she added, “i it's becoming increasingly table stakes to make sure that your products are prepared for the future, sustainability, and it's going to be really important for our industry to really get under the hood and understand how to to make it profitable to have products that are also good for the planet.”

Nehring said, “It's going to be an educational piece that we're going to need to work towards and continue to drive towards the consumer so they have a better understanding of sustainability initiatives.”

Media of the Moment

The discussion concluded with a brief examination of the ways in which the industry is affected by the generational changes in how we communicate with one another.

Law said a SPINS survey on 50 leading executives in the natural products industry evoked concern about social media and other non-traditional channels of sales and customer engagement where people are spending a lot of their time, for which the executives felt relatively unprepared.

Peters said, “The speed at which we're able to gain information, absorb and explore is just incredible… We discover a brand, and it has our attention for a moment. How do you capture the purchase at that moment?”

And Nehring said about consumers, “They're used to a multi-channel type of approach to shopping, and so social media is driving a lot of growth across these trends. Statistics show that 50 percent of U.S. adults who follow social media influencers are also following food and drink accounts. And food and drink is the second leading category followed on social media, only behind entertainment.”

These are just snippets of all the information that was shared during the webinar. We urge you to click the button below to view the full webinar.