Surveying the Canadian Consumer: Healthy Foods, Ingredients & Natural Health Products
Date: March 2013
Access to strategic information is required to properly assess market opportunities and target new product development. Although we know the demand for healthier foods and ingredients is growing, specific information on the needs and wants of Canadian consumers hasn't been available....
To help fill this information gap, BioAccess recently completed a Canada-wide survey to assess perceptions on health and wellness. The survey delved into consumer attitudes of healthy foods and ingredients including functional foods and natural health products – including shopping locations, information sources, ingredients of interest, key marketing labels/terms, and what's being purchased, etc.
We will be providing this information to Canadian small and medium sized companies in a variety of ways, including:
A short industry webinar March was presented on March 5th. You can watch it here:
- Workshops in both B.C. and Saskatchewan were done in March, more workshop are planned for April, May and June. Contact us if you would like one in your region.
- Email BioAccess to request a copy of the full report
- Assistance understanding and applying the survey results will also be provided (i.e. data-mining)
Please contact us if you want to learn more about this exciting project!
Rumble® is a new brand of beverage created by Groove Nutrition. It is a story about a product developed and marketed by a small Victoria, British Columbia company that originated out of an unmet need of one of the co-founders.
Paul Underhill is passionate about life, work and play – in other words, getting the most out of every day. He recently underwent a double lung transplant to deal with a genetic lung disease. His recovery has been remarkable and together with other team members – a naturopath, foodie and business expert – they developed and launched two flavours of Rumble® nutrition drinks in November 2012, vanilla and Dutch coco.
The journey to launch Rumble® began five years ago. To address his health needs, Paul went searching for a drink that met his caloric and nutritional requirements but one that also tasted good and was ready to drink. He found nothing on the market. And so the development of a new category began. Rumble® is the first in a new beverage category, “nourishing drink”. Paul explained that the “nourishing drink category is about nutritionally balanced drinks that contain no artificial ingredients”. This nourishing drink category is marked by the benefits of convenience, health, and hunger-fighting.
Groove Nutrition markets Rumble® as “the healthy drink for hungry people”. Each bottle contains 20 grams of protein, over 3,100 milligrams omega-3s (all from healthy fats), 400 grams of calcium and 8 grams of fibre and blend of antioxidants. The drinks also boast of being gluten-free, GMO free, soy free and are Kosher certified. Rumble® beverages are sold in the grab-and-go chilled section at retailers.
As well as being a nourishing drink, Rumble® incorporates social responsibility into its philosophy. Firstly, the company donates 1% of all sales to various charities that fight hunger. And secondly, it respects the environment by using a novel container. The bottle is resealable, recyclable and environmentally friendly.
The biggest challenge in bringing Rumble® to the market was convincing people that the drink had a great taste. Paul said that consumers at trade shows as well as retailers asked “how can something this good for me taste this good”? That good taste was a result of four years of hard work refining flavour profiles and conducting taste tests. But all that hard work paid off.
The initial uptake has exceeded all company expectations. Paul stated that “the reception has been unbelievable – 100% of the stores that have looked at our drink have picked it up”. Current retailers are increasing their orders and new locations are being added daily.
While the company is still in the midst of the launch of Rumble®, its products can be found in stores in five provinces. The retail locations are found on the company website. Following the launch phase, the company will begin plans for expanding into the U.S. market as well as the development of line extensions.
And on another note, Paul recently won two gold medals in cycling at the Canadian National Transplant Games in July. His next training target is the 2013 Rumble GearUp4CF – a 1,200 km Vancouver to Banff ride over 9 days! Rumble is the title sponsor for this year’s ride which raises funds for Cystic Fibrosis research. We wish him all the best!
By: Mary Ellen Hodgins, February 2013
I have heard an increasing amount of buzz about crowdfunding and crowdsourcing over the last number of months. Not only have I seen the concepts being discussed in the various media sources like Forbes magazine, The Globe and Mail, New Hope and the web in general but there have been a lot of references to both terms at meetings, conferences and in various discussion groups I have attended. The media has done a good job of increasing our awareness but based on some meetings I have attended, it appears that these terms are being used interchangeably by a number of people. So I thought I had better do some homework on each concept.
Crowdsourcing essentially is a platform to tap into the wisdom and ideas of the public or a targeted group of individuals to assist an organization or company address an issue. It’s about open innovation – seeking outside assistance to create new products, address humanitarian needs, deliver new services. Organizations from the Bill and Melinda Gates Foundation to Lego have used crowdsourcing.
Just recently, Coca-Cola used crowdsourcing to develop a Valentine’s Day ad for “American Idol”. The “Love is in the air” ad was filmed by a young New Zealander and was deemed a great success.
While not exclusive to the large and multinational companies, it seems that crowdsourcing has become a major tool of this sector for several reasons: the high cost of research and development; the growth of social media and ease in accessing “crowds” (better defined as communities of interest); and their ability to manage these communities of interest.
I am also aware of some smaller companies in our health and wellness space who have also utilized crowdsourcing successfully in the development of new products. For example, Derma Wise Skin Care Ltd., a Canadian health sciences company producing the Théra Wise line of bioactive, all-natural therapeutic ointments, has tapped into a specific community of interest, “moms”. Warren Brander, company President, explained that crowdsourcing through Twitter has allowed him to link into groups of moms that can have as many as 15,000 followers in one group. This platform has allowed Derma Wise to build relationships with customers, gain valuable feedback and explore new product options.
Crowdfunding is a form of crowdsourcing but the terms should not be used interchangeably. So what is Crowdfunding? Ethan Mollick of The Wharton School of Business describes crowdfunding as “a novel method for funding a variety of new ventures, allowing individual founders of for-profit, cultural, or social projects to request funding from many individuals, often in return for future products or equity”. Crowdfunding can be used for lending purposes (e.g. micro-financing), donations (e.g. for disaster relief), to raise equity for a company and also for “rewards”. For companies or organizations searching for financing, the latter two methods are usually targeted: equity-based and rewards-based.
It should be noted however that in Canada, equity positions utilizing the crowdfunding model are not allowed as yet. The concept of equity-based crowdfunding is being examined in most provinces. Organizations such as the Ontario Securities Commission are seeking input on the issue. As the use of crowdfunding is set to explode in 2013 increasing dramatically from its value of $3B in 2012 as described in Forbes magazine, watch to see which provinces start to allow equity-based crowdfunding.
The rewards-based crowdfunding however is the one that appears to be of most interest to the Canadian life sciences sector including the health and wellness products segment under the current regulatory regime. A growing number of start-ups are talking about this tool to access funds to commercialize their innovative technologies and products. Over the past five years, it has grown increasingly difficult to secure financing in Canada, since venture capital and other sources of money have tightened significantly.
So for Canada, the rewards-based concept means that you are essentially pre-selling and promoting your product or service. The money raised through crowdfunding on a Canadian site for this purpose is then used to help further develop and market your product.
There appears to be a plethora of crowdfunding platforms, well over 500 on the web, targeting anything and everything. You have likely heard of many of the more prominent ones such as Kickstarter, indiegogo and Rocket Hub. They each have their own objectives.
Fundweaver is a Canadian based crowdfund focused on support Inuit, Metis and First Nations projects and causes. IAMscientist aims to bring the science, technology and medical researchers together to accelerate and fund the commercialization of discoveries. Kickstarter is more inclusive. The projects vary from a “BrandNew Windowfarms – Vertical Food Gardens”, that more than met its goal of $50,000 by raising over $257,000 within a specified time frame, to technology such as a “Helios Bluetooth Light Controller”. With respect to the latter project, funding is still underway with the goal of raising $300,000.
But not all projects require large funds. I was recently at a Food, City and Innovation conference in Austin, Texas where the owners of “Ten Acre Organics – Urban Farm with Aquaponics” described how they had more than met their goal of $10,000 by raising $15,828 on Kickstarter.
Crowdfunding has also attracted the likes of the multinationals such as Proctor and Gamble and General Mills. Business Week reported last month that these two food giants are working with CircleUp, a crowdfunding website that connects small start-up companies with the large food companies for the purpose of either partnering or acquiring the brand or company. But beware. These “start-ups” usually have annual sales of $1M to $10M. So the term “start-up” may be a little presumptuous from the smaller company perspective.
A new fund is just launching and should be of special interest to the health and wellness products community in Canada. It is based in Vancouver and is the Healthy Healthy Crowdfunder. Its website notes that “it is backed by the ALA Midas Capital Inc. focused on financing health wellness and high tech health venture, where a balance of financial and social returns is part of our investment criteria”. Initially, Healthy Crowdfunder’s "community" is building support from accredited angel investors, and is awaiting such time that Canadian legislation will allow everyone to participate in equity-based crowdfunding
Eyes Wide Open
Crowdfunding is simply another source of financing. It should not be perceived as being the silver bullet. Companies still need sound business practices in place: a sound business plan; a unique value proposition; a good team.
The ability to access funds raised is different depending on the fund. Those like Kickstarter only allow you to access the funds IF you have met your fundraising goals whereas indiegogo allows you to access whatever is raised (less a 4% fee if you have met the target and 9% fee if it is not met). They also have stipulated timeframes within which the money must be raised. And some are country specific (or limit the number of countries from which funders and fundees can participate).
Costs to be placed on the various crowdfund platforms appear to run between 4-5% and there can also be an administrative fee of 3-4%. And not all of organizations meet their goal. Waterloo, Ontario’s Startup Canada Connect, a national online platform for entrepreneurs, had a goal of $100,000 on indiegogo but was only able to raise $36,731 within the allotted timeframe. Some of the platforms then charge a stiff 8-9% fee for not meeting your funding goal.
And some of the crowdfunds are country specific.
Andrew Tait, President of Tait Labs in Vancouver, BC is the Scientific Advisor for Healthy Crowdfunder. He not only is an innovator and entrepreneur but also a strong advocate of crowdfunding. He stated that “crowddfunding represents a great opportunity to connect with your customers and build your networks. But remember that preparation is everything. Companies must match project goals with the appropriate crowdfund. Each company must set realistic goals for their project. And above all, once the money is raised, you must deliver on your promise”. Andrew also went on to explain the need for companies to develop a video as it will increase the chances of successful fundraising by 20%.
Is crowdfunding for your company?
Do your homework. Read all you can about the concept and what it takes to have a successful campaign. You need to be aware of the rules going into this type of funding. Do your due diligence on the funds where you think there may be a good fit. You need to be aware of the regulations and taxation implications in your jurisdiction. You need to have your business practices in place.
But crowdfunding can represent an opportunity for you to access much needed funding in the early stages of your operation. It can increase your network and be used as a marketing tool. It also will give you a good indication if the market in fact wants or needs your product, technology or service.
Crowdfunding is a relatively new type of raising money made possible by the widespread adoption of communication technology. There has been little research done on the longer term cost/benefit of crowdfunding. But the idea is interesting to say the least. Who better to invest than individuals who actually want your product!
How many of you have heard of the plant known as purslane (portulaca oleracea)? You may know it better by one of its more common names - Verdolaga, Pigweed, Little Hogweed, Pusely, Rigla or Pourpier.
According to Elsie Belcheff of Margo, Saskatchewan, this plant is the one of the eight most common plants in the world. It has a long history of use for medicinal purposes and was first recorded by the ancient Egyptians. It is a rich source of health promoting nutrients such as vitamins, minerals, omega-3 fatty acids, beta carotene and oxalic acid. Dr. Oz, the medical guru followed by millions of people on TV is even a fan of purslane. On a spot on Oprah, he spoke of the plant for its omega-3 content and health benefits.
As a medical intuitive, certified herbologist and lymphologist, Elsie has researched the plant and its benefits extensively for the past couple of decades. She has searched its use in the literature as well as documented a significant number of cases of her clients who benefited from the usage of purslane. Based on her knowledge and experience, Elsie identified many of purslane’s benefits which are wide ranging. While it is primarily used as an immune builder, it is also used in the treatment of viruses and harmful bacteria due to its oxalic acid content. Please visit the company’s website to see a full list of the documented benefits of purslane.
Elsie has been so committed to the medicinal quality of the plant, that she established Natural Plantation Inc., in 2007, a company devoted to the development of medicinal and personal care purslane products. She explained that “we are the first company worldwide to have stabilized purslane”. Helping her along this path were scientists in Saskatoon and Edmonton. As a result, the company has developed a line of twenty-two products. And in 2012, the company received a Natural Product Number (NPN) from Health Canada for its Purslane Capsules.
The products are available at retailers in Western Canada (see the company website for a list of those retailers). As well, they can be purchased through on-line sales in both Canada and the U.S. Elsie has also received many orders from people around the world who are researching, self-medicating and looking specifically for purslane products.
Purslane however is not familiar to most people. Now that Elsie has received an NPN number for her product, her goal is to increase awareness of the plant and its benefits. She has just written a book “The Wonders of Purslane”. It is available in many bookstores or on-line through Amazon and Natural Plantation’s own website. Elsie will also be promoting her book and Natural Plantation’s products this year at the Health Freedom shows in Long Beach, Chicago and New York.
As the company grows, there will be more spin-offs for the small town of Margo. Currently, the company has two full-time employees as well as sales people in Canada. In addition, during harvest time, many of the local people are called upon to assist. Last year, Natural Plantation employed eighty-nine people, mostly local. And as Elsie explained, “it all needs to be handpicked”. As demand for the products grow, so too will the company requirements for meeting the demand. This is another growing success story for rural Saskatchewan.
Page 1 of 29