TikTok, Trends, and Spotting the 'Next Big Thing' | The Vitamin Shoppe CEO Sharon Leite

In this episode of the RETHINK Retail podcast, host Julia Hare sits down with The Vitamin Shoppe CEO Sharon Leite.

During their conversation, Sharon shares stories from her recent appearance on Undercover Boss and reveals some pretty interesting findings from The Vitamin Shoppe’s 2022 Health and Wellness Trend Report. Julia and Sharon also discuss TikTok and how businesses can best prepare for viral social media trends.

ABOUT: Sharon Leite is the Chief Executive Officer of The Vitamin Shoppe, which is the leading omnichannel specialty retailer of nutritional-based supplements here in the United States – offering wellness solutions across categories like vitamins, minerals, herbs, sports nutrition, green living, natural beauty and CBD. The company operates over 700 stores under The Vitamin Shoppe and Super Supplements banners, and earlier this year opened its first-ever franchise location in Greensboro, North Carolina. The Vitamin Shoppe has a growing e-commerce business and has also expanded into
international markets in Central America, South America, and Asia.

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Host: Julia Hare
Produced by Gabriella Bock

TRANSCRIPTION

Julia Hare:
Hello and welcome back to another episode of the RETHINK Retail podcast. I’m your host, Julia Hare, and today, we are joined by none other than Sharon Leite. She is the Chief Executive Officer of The Vitamin Shoppe, a specialty retailer you all probably have heard of, over a billion in revenue each year. They’re leading wellness solutions across categories like vitamins, minerals, herbs, CBD, you name it, and the company has 700 stores across two of their banners, and earlier this year, you opened your first-ever franchise, which is super exciting, and I’d like to hear a little bit about that. And I know you guys are expanding into international markets, so a lot is going on, and I’m super excited to have you on the show because you were just on Undercover Boss, and there’s so much to dive into.

Sharon Leite:
Well, it’s great to be here, Julia. Thanks for having me.

Julia Hare:
It’s great to have you. I watched your episode. I thought it was really enlightening. There were a lot of things that went on that you addressed, from the robotics solutions, with the sorting, and the bogus bopus, and things like that, so was there anything that surprised you or that you could talk about to our listeners from that show?

Sharon Leite:
Yeah, I will tell you it was an amazing experience. I didn’t know what I was going to get into when the producers came to us and asked me to be on the show, and for the company to be involved. You never know what to expect. I’ve watched the show for many years, and it has the typical format, the boss goes in and sees things, and then, hopefully, there’s a good outcome at the end. But what was really neat, we shot the show over numerous places across the country, it wasn’t shot in just one place, and there was absolutely no filter on the show, so no one was feeding me a line, or telling me what to say. I didn’t know where I was going from day to day, I didn’t know who I would meet. And the whole intent is that it’s all extemporaneous and you get a very authentic experience.

Sharon Leite:
And I think the biggest lesson I learned from the whole show, and yes, there were operational things that you got to see, that we needed some help on the inventory side, the robots were running into one another, the POS really did crash when I was in the store, that wasn’t a staged experience, that really-

Julia Hare:
I was wondering, because you guys said it happened about every two weeks, but if you talk to anyone in retail, they say the POS crashes a lot, no matter where you are.

Sharon Leite:
Yeah. And we have done a lot of investments in technology, and the POS, fortunately, we’re moving to mobile POS this year, so that big clunky thing will be literally gone, but it really did crash. And bogus bopus was probably my biggest surprise out of the whole thing. But at the heart of it all was that we have these incredible dedicated health enthusiasts, and they really do care about our mission, which is helping our customers become their best self, how they define it, because we know that all of our customers are on their own journey to their own health and wellness goals, whatever that may be, and we want to be that solution and trusted place where people come. And each one of the associates that I met had a genuine care and concern for the benefit of their customer and for doing the right thing for the organization.

Sharon Leite:
And it was really incredible to be able to see that up close, because as the CEO, you don’t often get that truly unfiltered. I mean, I go to a lot of stores, I visit a lot of our folks, but they know I’m coming as the CEO, versus how I came and got to be Marie with dark hair and glasses, a gift shop owner that unfortunately closed because of COVID, and was going on a journey myself of figuring out what I wanted to do. And so the information that I also learned from them was truly unfiltered as well, because they were here trying to help me figure out what was my next journey in life from a career perspective.

Sharon Leite:
And so it was really a very fulfilling experience, and I’m really happy to say that all four of our health enthusiasts are still with us today, and they all either have enhanced jobs, or they’re in new jobs today.

Julia Hare:
That’s amazing.

Sharon Leite:
It’s really, really neat. We had a little reunion last month, we had our brand conference, and we brought all of our store managers together, and they were special guests, and it was great to actually physically have them all in one place, because they had never met one another, it was the very first time.

Julia Hare:
Oh, okay.

Sharon Leite:
They need to actually see them together, and for them to share their experience as well.

Julia Hare:
Well, and it’s so important because it goes back to the core of retail, which is the people. The people on the front line, the customers, it’s all about relationships. And I thought what was most striking, because if you watch some episodes of Undercover Boss, in other examples, sometimes the employees get caught doing things they shouldn’t do. And that’s just, it’s not for any good reason, and your employee was doing the bogus bopus.

Sharon Leite:
Yeah.

Julia Hare:
He was trying to get, for anyone listening, he was trying to get products on the shelves, and if he couldn’t get them fast enough from the warehouse, he would just order them as a buy online, pick up in store order, with him as the customer, and he would use his personal card. He would get the items, say he didn’t want them, and then stock them on the shelves. But it was really an altruistic thing he was doing, he was doing it to keep the speed. And you talked a lot about speed, so that just goes to show how dedicated your employees are, number one, that blew my socks off.

Sharon Leite:
Yeah, that was my big, I mean, you probably saw from my reaction.

Julia Hare:
Yeah.

Sharon Leite:
When he started telling me, “Oh no, I pull out my credit card and I swipe it through, because there’s inventory there and this DC will ship it to us, and then, I’ll just cancel it.” I was like, “But this is your own credit card?” Like, “But I don’t get charged because it’s a whole and I haven’t shipped it yet.” And I’m was just like, “Oh no, no, no, no.” So again, going back to the heart, and what they really wanted to do, they really wanted to help the consumer. And obviously when the show was filmed, it was filmed a year ago, and we did have out of stock. We were in the height of the pandemic.

Julia Hare:
Right.

Sharon Leite:
And there were supply chain issues, all the things that you hear that’s going on in the retail landscape, and we were not immune. No pun intended, but we were not immune to those supply chain challenges, and that was his way of fixing it for his consumer. So you’ve got to give the guy credit, right?

Julia Hare:
Give him a lot of credit, and then you were able to address those at scale, after you figured out that was happening. And it’s interesting because you said speed is so important in business, on the show. And I think you’re right, even with the pandemic and customers being a little bit more lenient, would you say that’s the most important change? Is just getting products to the customer as soon as possible because then they go to competitors or?

Sharon Leite:
Yeah, well convenience is a very important part of what our customers are looking for. We stand for three brand pillars of quality, innovation and expertise, and it’s really about quality in everything that we do. And one of those things in terms of quality, it is about the product, but it is about that quality experience. And so the experience for our customers is lots of things, but convenience is definitely one of them, and speed. And so for example, like when we launched Instacart, we launched it really, really quickly, and we can get the products to the customer even faster than Amazon, which is why we did it, because it was so important to our customer. And so those are just some examples of the things that are important to the consumer today. So yes, the products and efficacy of those products, the quality, the care that we put into the development, and the third party partners that we have to help us round out our assortment, are a really important part of the merchandising strategy and the strategic nature of what we’re trying to accomplish at The Vitamin Shoppe.

Julia Hare:
Wow, faster than Amazon, not a lot of people can say that, but partnering with Instacart is amazing, you guys have accomplished that. And I will say, do you notice, have you done any consumer studies? Because I read a while back that the trust, when it comes to these type of products that you consume when ordering from Amazon is not as high, because you really don’t know who the seller is, what kind of quality control, as if in temperature control? Whereas if I go to Vitamin Shoppe or one of your competitors, I know that I have a lot of trust there.

Sharon Leite:
Right, so we’ve been around since 1977, and so the foundation of who we are is for the consumer to trust us. So while we have gone through a tremendous amount of change as part of the organization, especially around our digital transformation, and some of the things that you saw in the show in terms of the things we’re trying to fix and adjust, the trust that our customers have in who we are and what we do, is a huge part of our brand promise, and the care that we put into what we do on the development side with our products. I mean, our products go through very rigorous testing, and they don’t get our seal of approval, if you will, unless they have been fully vetted, because the trust that the consumer has with us is paramount to everything that we do.

Julia Hare:
That really speaks to your brand and how long you guys have been around, and I know you released a report, it was from this year, health and wellness trend report. And there was a lot of good data, and one of the findings that our team called out was beauty consumers are increasingly becoming nutrition and holistic wellness consumers. So what does that mean, if we break that down a little bit?

Sharon Leite:
So we’re seeing a tremendous parallel between the beauty consumer and external beauty, and what I’ve always believed is beauty from the inside out, because anything that you take that we sell at The Vitamin Shoppe, you ingest. And so what we’re finding in the data, when we mine through all of our consumer data, is that how consumers feel, whether it’s their stress, mood, the sleep that they get, their nutrition. But that is a big part of who they are on the outside, and so the connection between beauty and health and wellness I think is extremely important.

Sharon Leite:
One of the things that I saw when I joined The Vitamin Shoppe three and a half years ago was the fact that the health and wellness or the vitamin mineral supplement space that we live in is actually in a very similar place that beauty was many years ago in terms of, it’s a very fragmented industry, it has a lot of people that develop products on their own, they’re very passion about their category. So when I was in the beauty business, we used to call them kitchen beauticians, concocting things in their kitchen, whether it’s skincare or cosmetics or things of that nature, and we have a lot of that in our category as well.

Sharon Leite:
Our influencers might be health and wellness experts, and they love this particular collagen, or their sports nutrition drink, or things like that. So we see a tremendous parallel to the category, and the focus that the customer is putting on their health, and I think it’s central to a lot of what happened through the pandemic and how people are taking their health into their own hands and connecting it to how they feel. And what we do is all about how you feel and helping them with their health and obviously that parallels very directly to the beauty business.

Julia Hare:
And are you integrating these insights into your approach in marketing to these consumers? Are you seeing increased searches on your website regarding really specific products? Or how is consumer behavior, has it changed?

Sharon Leite:
I think for our business, I’ve always wanted to demystify this category, and I think a big way in which you can do that is through talking about solutions, and making sure that whatever the customer is looking for, that you connect that to the solution. And then you almost work backwards with, here are the products that get you to that solution. And so if you look at our blog, if you look at our Instagram, if you look at any of our social channels, TikTok even, you’ll see us focus a lot on the solution, and the products, and what you need to do besides product to help you to get to that solution. So we believe, and we want to be, that trusted authority, but it really is about connecting the product to the solution or the end game of what that consumer is looking for.

Sharon Leite:
And you have to remember that our customer at The Vitamin Shoppe is so broad. I mean, we have everyone from young adults to grandparents, and life journey is very different in terms of what they’re looking for based on their age, and where they are in their life stage. And so, we’re grateful that through the data that we’ve been able to mine on the information that we’ve been working on, on our trend report, is we’re able to really segment by age, by category, what people are looking for. And again, we want to be that trusted source for the consumer, but knowing that customer at a very intimate level is critical, especially in this industry, because it’s such a niche area where customers are looking for very different things based on different life stages.

Julia Hare:
And really, your frontline staff are advisors, and that was a big point that was made during your show on Undercover Bosses, because there is so much product information that they have to learn, and you invested, I think it was half a million, into the training programs. How has that been going? The rollout?

Sharon Leite:
Well, I think what’s been excited about not only that, it’s the work that we’re doing on mobile. So now the associates have an iPad where not only does it have customer information in terms of their purchase history and what they’ve bought, but it also has, at their fingertips, product information. So while we do provide a tremendous amount of education, we will continue to invest in that because we really believe that what makes The Vitamin Shoppe really stand apart from anybody else’s space is our health enthusiasts. I mean, their knowledge and their true desire to help people become their best selves is a critical component to our success.

Sharon Leite:
And so it’s not only providing them the information, but providing them also the resources to get to it very quickly, and providing the tools that surround it, to make sure that as a customer asks information, that they have the information at their fingertips. They’re never going to remember it all, although Glo, on the show, was quite incredible with her extensive knowledge of the product. But, we have almost 5,000 health enthusiasts on the front lines, and at some point in their stage of working with us, someone is new, and we have to make it as simple as we can for them so that they can help the customer in the best way possible.

Julia Hare:
And it sounds like that’s adding that element of personalization as well, which every consumer desires and demands, to some extent, now.

Sharon Leite:
Well, especially in our industry, because the last thing, if you’ve got a customer that’s coming in for, maybe they’re helping an aging parent with bone density, you don’t want to serve up content that sells them creatine, or a pre-workout that’s got caffeine in it. You really need to, personalization in particular, is really, really critical in our industry.

Julia Hare:
Absolutely, and you can see that on the show, Glo, your health wellness? What do you say? It’s-

Sharon Leite:
Health enthusiast, health enthusiast, yeah, it’s a mouthful.

Julia Hare:
Yeah, health enthusiast. Thank you. She pointed out that the customer who came in, she remembered he had purchased [inaudible 00:16:26], and she mentioned that it was integrated into the protein that he was interested in so he could maybe use that with the supplement or in place of, and it was just amazing to see that kind of customer service and personalization. Now you can do it at scale, once all the profiles are consolidated, like you mentioned, on the iPads.

Sharon Leite:
Yeah, and I will tell you that what Glo did is not unique just to Glo. We have a tremendous amount of health enthusiasts. I’m amazed at how so many of our health enthusiasts know the customer literally by their first name. And they remember when they were in and it’s the culture and kind of what’s been built out in our organization, and the true desire to help others is really inspiring.

Julia Hare:
That is, and that’s what makes specialty retail that much different.

Sharon Leite:
I couldn’t agree more, that’s why I’m a specialty retailer, when you can have that connection with the customer in a really meaningful way, the experience is incredibly gratifying. I think for both, both the customer and the health enthusiast, to know that you’re really helping someone.

Julia Hare:
And just to have that relationship, it feels like you’re going to see a friend, you know?

Sharon Leite:
Yeah, absolutely. I couldn’t agree more.

Julia Hare:
The one trend I have heard you speak about a few times during our conversation so far, is social media, you mentioned your Instagram accounts and influencers, and obviously there’s been some crazy things that have been recommended on social media by influencers in the health and wellness space, and some not so crazy things, some very helpful. But, there was a report that our team pulled up, for everyone listening, 42% of Americans say they’re highly likely to try a new healthcare product if they learn about it on social, Gen Zers and millennials are twice as likely than older generations to be influenced. Can you share with us, Sharon, any examples that you’ve seen directly from your influencers that you work with? Or from the brand or space?

Sharon Leite:
Sure, so probably the biggest one, as of late, has been TikTok. So there are two examples I’d love to give you. One is how TikTok just really brought to life, and was actually about this time last year, chlorophyll, and what chlorophyll could do. And everywhere on TikTok, people were drinking it, and talking about all the benefits of it, and we saw, online, a spike of over 3000% of people looking for chlorophyll. I mean, no one really talked about chlorophyll, but it showed up on TikTok, and all of a sudden it went through the roof.

Sharon Leite:
In addition, we absolutely sold out chlorophyll. I mean, it was just gone, and it happened, like that, literally like that. And the other one that’s pretty amazing is, we have a drink called Prime, and it was created by Logan Paul.

Julia Hare:
Okay.

Sharon Leite:
He came into our store, and who would think? Logan Paul, The Vitamin Shoppe, Prime, I mean, it’s every teenage kid’s favorite drink right now. And he did this very, we actually found out about it because we were on social media looking at it, and all of a sudden it showed up on our TikTok feed, and there’s Logan Paul, in our store, saying, “Here’s the product.” He literally just launched, we sold six weeks worth of product in six days.

Julia Hare:
Wow.

Sharon Leite:
And that’s the power of what social media can do when something really truly goes viral. And so, being on top of those trends, making sure that you’re where the customer is. And in this day and age, a lot of it is in those social channels, and so you have to be there. And again, I go back to the parallels to beauty, if you think of one of the things that makes the beauty business so great, it is the usage of influencers, and really following the trends, and showing up in different channels, because that’s where the customer is, so you have to be there. And we have really gone down that path in terms of our digital focus, and making sure that we’re at the forefront of those kinds of trends.

Sharon Leite:
Another example I’ll give you is, the focus on what’s happening in the creatine market. So creatine was a trend that we noticed that was trending on social, and so we took a hard inventory stake on it. And so now we kind of own the creatine market, and it’s been mixed in terms of bringing, again, new customers into the store that may not have thought about The Vitamin Shoppe. So our job is now that these new customers have come in, how do we keep them? So, that’s where our loyalty program and some of the other digital activities that we’ve done in terms of showing them this is what The Vitamin Shoppe is today, versus maybe what they thought of it was before, or maybe they didn’t even know about us. We have found social to be a very, very important medium for us as we think about what we’re doing and where we’re going.

Julia Hare:
And so, for the creatine example, did your teams notice this resurgence and the interest on social media? And then you were like, “All right, let’s get stocked up,” or?

Sharon Leite:
Yes, it was amazing how it was, it had this swell, and in this current supply chain challenge, challenges that we’re all having, we took a bet, and bought into it, and fortunately, it’s worked out in our favor that way. The trend bets don’t always work, obviously, but for most part, if you can really make sure, again, I talk a lot about being a merchant-led organization. And part of that is when you see these trends, and if you stay so close to your customer where you can isolate and see what’s happening, and you have merchants that are really nimble and able to react in that regard, it can really be incredibly beneficial to your business, and certainly the customer wins in all of that.

Julia Hare:
Absolutely, and it sounds like if you didn’t implement the more sophisticated inventory management tools, that it wouldn’t be possible to have this fast reaction, because these social media trends pop up, like you said, overnight sometimes.

Sharon Leite:
Absolutely, and the things like the chlorophyll example, there is no way could, that one happened, truly, out of the blue. But the creatine, just based on what’s happening and really watching what’s happening, the broader social ecosystem, that allowed us to really take advantage of that trend.

Julia Hare:
Very cool. And then, are there other strategies you can think of outside of what we talked about, for retailers who are listening, to make sure that they’re saying on top of these new trends that are popping up? Or new consumer demands because they’re so fast?

Sharon Leite:
Well, I think, I’ve always been a big believer in listening to the teams that are closest to the customer. And it’s amazing, if you’re a retailer, and you have, whether it’s a call center or whether you have associates in your stores, and you also ask them. Despite data analytics and all the things that you can look at in terms of the way companies mine data and look at what their customer is doing, and customer behavior, market basket data, and all that kind of stuff, talk to the people that are closest to the customer, it’s amazing what you can learn from them. And when you start hearing the same thing from the people that are closest to the customer, you need to pay attention to that, because they truly know, they’re talking to the person that’s putting the money in the register.

Sharon Leite:
And so it’s really important to stay close to them, and value what they’re telling you, because typically they know, and they’re a great source of information. I know I rely on them a lot, and if there’s anything that might Undercover Boss experience taught me, is to lean in and listen to them even more, because while everyone in a corporate office environment is all well intended, the people on the front lines, wherever that frontline happens to be in your organization, gets the culmination of all these great ideas by all these other people, but then they execute it, and they’re listening to what the customer is saying. And so, those can be, it can be a great resource for you.

Julia Hare:
Absolutely, a gold mine of information, and I’m super excited to see what comes next for The Vitamin Shoppe, it sounds like with the mobile POS and some of the other solutions, you guys are just at the forefront of 2022 and beyond, when it comes to retail and completely digitizing operations. But are there any new launches that you can give us some information about, to our listeners, before we hop off today?

Sharon Leite:
Sure. So, we are super proud of a new brand that we’ve launched, we’ve invested a tremendous amount of effort, resources, amongst our private brand portfolio. And just recently, we launched our brand called TrueYou. And TrueYou is about, we saw white space in the market around specifically women, and providing a brand holistically from basically college through post-menopause, to take women on a life cycle about what they go through. You were just telling me that you’re about to have a baby, so you’re [inaudible 00:25:41], and what your body needs today is different than when you graduated from college, and what you’ll need as you get older. And so this particular portfolio of brands, through a lot of research, using wellness and doctors and experts in the field, we put together a really cool brand, focused on women, called TrueYou.

Sharon Leite:
And the other part of what’s important about this brand, because we know that causes are also very important, is we’re very proud to also, as part of this, we’re affiliated with an organization called Kiva, and Kiva is a micro loan organization, I would recommend your viewers to look it up, it’s kiva.org. And through any purchase with TrueYou, we’re giving every customer a $25 credit so that they can go on to kiva.org, and they can pick from a multitude of folks in a lot of underdeveloped countries, to help them, and they’re entrepreneurs, a lot of them women, to help them invest in their businesses, or whatever it is that they’re doing. What I love about Kiva is not only that you get to pay it forward, but Kiva has a very high percentage of repayment, it’s about 96%.

Julia Hare:
Wow.

Sharon Leite:
When that money comes back, it gets reinvested again and again, and so it’s amazing the power of the impact, and we’re excited to have also that arm of supporting not only this incredible product to help women, but to be able to give back to women in need. So, check out TrueYou, it’s a really great brand, and we just started with a very small amount of SKUs, it’s predominantly multivitamin, collagen, and there’s some real specific things, like there’s a cleanse in there, there’s we have this, if you have a UTI, it’s called Easy Peasy, so they’re fun names, with what it is, but it really is about taking a woman through her life stages, and helping her see that she has a brilliant life, and in fact, we want your brilliant self to shine through, and that’s what we talk about with TrueYou because we think it’s so important for women.

Sharon Leite:
So super excited about that, we have Beauty coming soon, and very excited about that, and that will probably, we’ll see that more towards the end of the year. And then the portfolio of products will continue to grow as we continue on this brand, but super excited about TrueYou.

Sharon Leite:
And then the last thing I’ll just tell you, in terms of growing our businesses, besides all the things you mentioned at the top of your show, was the fact that we launched our first franchise store. So, we believe that we can bring The Vitamin Shoppe to a lot more consumers, and we know that we have a lot of white space, and in order to accelerate that growth and to connect with these entrepreneurs that are so passionate, also, about our mission of helping others and helping them become their best selves, we’re excited to launch a fully, we will be the only fully Omnichannel specialty retailer out there, period. And we’re very excited about that and having new fresh ideas, and entrepreneurs and people that are as committed to our mission as we are, in new communities across the United States. We’re super excited about that too.

Julia Hare:
Well, I’m super excited too, because you already have 700 stores, and I think that the opportunity is really large for you guys to really expand quickly with the franchise. And the TrueYou products, I’m really excited, I will check them out next time I’m in The Vitamin Shoppe, and anyone looks great.

Sharon Leite:
I’ll send you some, Julia.

Julia Hare:
Thank you.

Sharon Leite:
We’ll send you some.

Julia Hare:
That would be amazing. Yeah, I would love to try it. Well, it was great having you on the show today, Sharon Leite, CEO of The Vitamin Shoppe, and I hope to have you on again soon.

Sharon Leite:
Thanks again, Julia, it was great to be with you, and best wishes to you.

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