Unilever talks ‘explosive growth’ of its wellness business

In a wide-ranging talk, Lori Lauersen, senior vice president of R&D, Health & Wellbeing at Unilever, said that emerging tools like artificial intelligence, machine learning and digital biology as well as acquisitions and a doubling down on beauty from within, hydration and women’s health categories contributed to the 20% underlying sales growth of the company’s wellness business in 2023.

She added that growth will continue as the division expands in China, a key player in Unilever’s wellness supplement growth market.  

“China is a very exciting place where we recognize that health is a lifestyle,” she said. “Our pursuit is not just U.S. wellness, but it is global, bringing our brands to more consumers around the world.” 

Portfolio direction​

During the peak of the COVID-19 pandemic, the vitamin, mineral and supplement (VMS) market in the United States grew significantly, especially in the immunity, sleep and stress categories. According to the 2024 American Botanical Council annual Herb Market Report, however, by 2022 there was a 1.9% drop in supplement sales from the previous year​.

Despite this market correction following the pandemic, the supplement industry has maintained higher baseline sales than the period prior to 2020, Lauersen said.

“The pandemic really has triggered a true lifestyle pursuit, particularly amongst Gen Z and millennials that's sticking,” she said. “They're really engaged in the [wellness] category. They're thirsty for information and data. Unilever is perfectly poised to be able to provide them with products, education, research and information that meets their needs and helps them to make the best choices possible.”

Part of that sticking power for Unilever is attributed to supplying supplements with fast-acting results. Acquired by Unilever in 2022​, Nutrafol offers a hair growth supplement that provides visible results within three to six months of using the product. Over the past two years, active Nutrafol customers have grown 300%.

Unilever also acquired vitamin manufacturer SmartyPants​ and powdered water enhancer Liquid I.V. in 2020. Like Nutrafol, Lauersen said Liquid I.V. as functional beverage also has that experiential factor for consumers.

“We have an acquisition strategy in terms of how we have built the Health & Wellbeing Collective today,” Lauersen added. “We’ve completed seven acquisitions to date, and we're very intentional in terms of which of those categories that we are looking to build in. Now, we're trying to double down and make sure that the brands and the investments that we've already made and the consumers that we're already serving are continuing to be served.”

However, Unilever does take risks in terms of commitments to develop its pipeline when it comes to new and emerging science for additional categories, she added.

Defining ‘holistic’ wellness​

As younger generations adopt wellness brands, they are often searching for a holistic approach to wellness, although Lauersen said that the definition of ‘holistic’ can mean different things to different people.

For example, Unilever acquired Onnit in 2021, a brand focused on the wellness lifestyle.

“These [consumers] are talking about physical, mental and spiritual wellbeing, and that’s very much present in the way our Onnit brand communicates with its core group and the way that the brand represents itself,” Lauersen said. “I certainly see that as something that is growing, and it’s very sticky right now among a younger group.”

She added that the Onnit Facebook group’s engagement and community is holistic in a different way than consumers of the Nutrafol brand, those who are trying to understand the root causes of hair health challenges, and making sure that the solution is a holistic approach to address them.  

Lauersen noted, “we're in a period of explosive growth from research, and therefore, I believe that we are going to be in a period of sustained holistic growth for health and wellbeing.”

Being holistic also means tackling safety. Unilever is making its mark by examining the safety of its digitally native products when they are used together, rather than used individually. That latter is the industry standard.

“Customers are sharing with us more about their personal needs and therefore making recommendations tailored to them, Lauersen said. “I feel it's our responsibility to ensure that the recommendations have been looked at holistically for safety.” 

China’s role​

Unilever is bringing more of its wellness brands to consumers worldwide, and the Chinese market is no exception. 

As the second largest VMS market in the world, China holds vast opportunities to connect brands to customers. Unilever has an R&D team on the ground in the country and has already brought Nutrafol, Liquid I.V. and Olly Nutrition to the region.

In Unilever’s Health & Wellbeing Portfolio, Olly has been in China the longest, is the largest brand in the market and is continuing to grow. It was named a top five VMS brand on TikTok CBEC.

“The regulatory framework in China is very complex, so understanding exactly what you can say and can't say for products is very relevant and meaningful,” Lauersen said. “But as we're designing our pipeline of products for China, seeking to ensure we understand traditional Chinese medicine, we know the unique preferences, the flavors, the formats, and where consumers are shopping and how they're getting their information. This all becomes critically important for any brand to be successful within China.”

She noted that the market and consumer expectations in China are different than they are in other places in the world. As traditional Chinese medicine is front and center, Unilever is focused on bring opportunities together that blend tradition with western brands.

"This is certainly a critical factor in terms of your ability to succeed within China,” Lauersen said.