There are a variety of consumer trends that can affect the dietary supplement, functional food and nutritional beverage industries short term and into the new millennium. The following trends are in no particular order, given that all these considerations will have a significant impact on the business.

Consumer demands and expectations for the new millennium will be tougher than what we have seen in the 90's. Consumers will want things faster, easier, simpler and NOW! Business' emphasis in past years on improved customer service has resulted in increasing consumer expectations. Being one step better than your competition will continue to influence consumer choice.

In the future, consumers will increasingly look for "total value." By "total value" we are not only looking at price, but availability of product, ease of use, company availability and willingness to solve problems on time. All these factors make up an individual's perception of value. Statistics continue to demonstrate that a majority of people will pay more for a product or service when the "total value" element is met.

And just who is your customer for the new millennium? It's the baby boomers. Understanding the purchasing habits of an older core customer base will be a crucial element for business. The aging of America is real and midlife now occurs at the age of 43. Baby boomers who started turning 50 in 1996 are doing so at a rate of 300,000 per month. The baby boomer generation will be the largest buying consumer group in the years ahead. Baby boomers are seeking the "fountain of youth," looking for anything that will bring personal health, well being and satisfaction to their lives. Last year marked the first time that we spent more on services than we did on material items, demonstrating the trend to increase personal satisfaction and enjoyment. In the quest for an extended quality of life, consumers will increase their purchases of products that assist them in this goal.

Another element to consider with the future consumer is the importance of time. Consumers today are combining work in the office with work at home. Time and the juggling of work and family life will continue to be a major concern, with the resulting desire to reduce the stress of their busy life. Because of a greater focus on personal time, consumers will seek simple, time-saving solutions. They will want one-stop shopping, easy access to information and immediate attention. This means that businesses will continue to form partnerships, offering multiple products and services in an easy-to-access venue, providing a valuable time-saving service to their consumers and a cost-effective means of operating their business.

Computers in general will dramatically change our lives in the future. While the number of people owning a computer in the past has remained relatively low, that trend is rapidly changing. Various studies indicate that roughly 50% of American households now own a computer, with about 30% of those owners browsing the Internet. That number is expected to grow dramatically in the next few years as computer prices continue to drop. As much as baby boomers are not particularly fond of new technology, they are learning that the Internet is a valuable resource.

On-line demographics are also rapidly changing. Depending on the particular study you review, roughly 54% of Internet users are men; 46% are women. The Internet was dominated by males as recently as two years ago. Women are currently the fastest-growing segment of Internet users and more and more seniors are buying computers or using computers at centers to surf the net. These two groups, women and seniors, will play a critical role in the rapid success of Internet commerce. Women make many of the purchases in households and seniors have the financial resources to make on-line purchases. According to the 1998 Spring Mediamark Research study, 61% of on-line users have household incomes between $50,000 and $150,000. Studies also indicate the highest user group on the Internet is the 35-55 age group, which clearly defines the baby boomer generation as the key consumer group that will dictate how business is done in the future.

E-commerce (buying on the Internet) is expected to increase dramatically, in certain markets, over the next few years. However, a recent study conducted by Yankelovich & Partners showed that 63% of web users are unwilling to purchase products on-line until there is more human interaction involved. There is still the reluctance by many consumers to give out credit card information over the Internet. (As a side note to the power of the telephone, consumers will freely give a credit card number over the phone.) This reluctance is decreasing with the improvement of secure websites and all eyes will be on 1999 to see if e-commerce really takes off. One forecast states that the number of people buying groceries on-line will jump from 10,000 in 1997 to about seven million by 2002. One need only to look at the success of Amazon.com to see that the Internet is already a strong viable market provided you are offering the right product.

The benefit to Internet buying for the dietary supplement and functional food industry can and will be enormous, with one caution. Baby boomers will typically not purchase dietary supplements until their questions are answered. This is one product area that really reflects the concern stated earlier regarding consumers' decision not to purchase until there is more human contact. It is not enough to set up shopping services on your website. You need to provide means for consumers to get information through real-time, interactive sales and service across the Internet. This can be accomplished through e-mail and chat functions as well as web call (simultaneous on-line calling and web page viewing), which is already available, though few consumers have the correct equipment to do this as of yet.

While the Internet will be the wave of the future, never underestimate the value and power of the telephone. Toll-free numbers have been and will continue for some time to be the primary means of contact between business and consumers. This is due in part to the ease of use and time element. It is still much easier and quicker to pick up the telephone and ask someone your nutritional question than it is to sign on to a computer and send an e-mail.

As product lines continue to grow rapidly in the dietary supplement and functional foods areas, the need to assist consumers in making informed purchasing decisions will increase. Already the Internet and media are major sources of misinformation among consumers. While technology is advancing, it is critical that dietary supplement and functional food companies offer consumers information about their products. The best means is through a toll-free number with live representatives and not automated voice response units. Consumers are calling to ask health and nutrition questions, not check an account balance where automated systems can be very effective. While this may initially appear as an additional expense, the truth is it will improve your bottom line through increased sales by providing consumers knowledge about your products and helping build brand loyalty. But don't feel you need to house this function within your offices. A continually growing number of businesses are outsourcing their toll-free number services to an outside service provider. This allows you to continue your focus on your core business objectives and allows the outside service supplier to use his or her expertise in providing quality service to your valued customers.

The dietary supplement and functional food industries will face some unique consumer challenges in the future. Because of the nature of the products, there will be at the same time both high consumer interest and equally high consumer confusion. The companies that will succeed will be those who pay close attention to their consumers and provide the answers to consumers' questions in an easy to reach format. The Internet will play an important role to the extent that backup information services are offered to the consumer. In what promises to be a highly competitive marketplace, those businesses that value their customer relationship and provide quality products and services will be the winners.