2019 CPG Trends

BPM graciously opened their doors to a “sold out” Naturally Bay Area crowd Wednesday, February 6^th. Karen Howland, Managing Director of Circle Up, and Wayne Wu, Managing Director/Partner of VMG and host of the podcast Unfinished Biz, brought the investor perspective on CPG trends in the natural product industry.

As the first Networking Night of the year, the format of the evening provided both the opportunity to gain expert insight, but also to connect and share with others in the natural products community. Mike Dovbish, Executive Director of Nutrition Capital Network moderated the evening which started with questions for Karen and Wayne about what they are seeing in the CBD space.

Both agreed the market will grow exponentially; CBD will infiltrate many categories; and, we are sure to see a strong showing of CBD products at Expo West. It is undeniable the momentum that exists among entrepreneurs, major corporations and consumer demand.  But, there are still challenges to overcome. The passing of the Farm Bill was an important milestone from the standpoint of the DEA, but there is still uncertainty on the FDA side. There is a need for regulatory guidance. And, the level of consumer education required on what CBD actually is will need to be significant. Will the CBD market reach the projected $22 billion by 2022? It’s yet to be seen. But, in the meantime, we can all keep a watchful eye on this modern-day gold rush.

Karen and Wayne were also asked what trends and changes they are seeing in the retail space. They acknowledged that it has been interesting to see the evolution of how brands have been entering the market over the last decade. It used to be that you had an amazing new product, you launched it in your local Whole Foods and then moved on from there to expanded, even national, distribution. You could progress through a very disciplined channel strategy. But, there’s been a shift in the market. Companies have the ability to launch products in different ways such as direct-to-consumer or Amazon, which appears to be taking steps to become more “brand friendly.” The two also see a change in how conventional and mass retailers look at emerging brands and natural products. They noted that Wal Mart is leaning in almost more than any other retailer in the natural products space. Because of the ever-changing ways companies are launching brands and getting products on shelf, distributors are playing a different role than they once did and they will need to continue to evaluate their business models in order to be successful in this new market.

BPM provided a lovely spread of appetizers and treats. Lumen sampled their regenerative hemp juices; and Hector, with Tia Lupita, shared his new cactus tortilla chips. Want to join in on the fun? Visit www.naturallybayarea.organd select the “Events” to see what’s on the horizon.

Written by Laurie Glynn, Label Technology and Naturally Bay Area Board Member

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