CPG Trends, Innovation & Disruption 25 January 2025

The “Ripple Effect”: Why Ozempic’s Impact on the CPG Industry is a Slow-Burning Disruption

What is the immediate impact of GLP-1s like Ozempic on CPG consumption? Read this article to understand the opportunity areas to watch.

GLP-1s – originally intended to treat diabetes, are designed to mimic the way a hormone called glucagon-like peptide 1 works in the body. When blood sugar starts to rise after a person eats, these medicines cause the body to make more insulin, which helps lower blood sugar (1). As the additional effects of GLP-1s have become clear – namely rapid weight loss, a growing number of non-diabetics are using the drug.

With rising GLP-1 usage comes a “ripple effect” on other categories, ranging from food and beverage to supplements and even cosmetics (2). CPGs are bracing for impact, and for many, the race for NPD is on. This article contextualizes the immediate impact on F&B consumption and highlights which opportunity areas to watch as the phenomenon continues to unfold.

How does rising GLP-1 usage impact CPG?

The main overlap between CPG and GLP-1 stems from its ‘unintended consequences’, with side-effects ranging from vomiting to diarrhoea and loss of muscle mass in a condition known as sarcopenia. Early evidence even suggests that “GLP-1s, by regulating the release of dopamine, may make the flavour profiles of ultra processed products, many of which have been optimized to stimulate the brain’s reward system, less appealing.” (3). As such, there are clear implications for food, beverage and beyond.

As explained by Sevendots partner Valerio Nannini:

“There’s an opportunity on one side, but then there’s a question mark on the other. The opportunity is to start looking at the needs of these people and start developing new products with high protein content that can fit with changing diets, or products that alleviate some of the side effects. On the other hand, the longer-term impact of all this is that GLP-1 users don’t feel like eating anymore, so snacking will go down. I think that it is right that snacking companies are worried about this, but equally, they can adapt their portfolio to increase protein and decrease sugar content. Protein in particular should be a major consideration, to counteract the muscle loss caused by the drug.”

As such, GLP-1s have the potential to cause downturns in certain areas, but they also create new opportunities. In the following sections, we will explore both of these elements, starting with contextualising the scale of the problem.

The Immediate Impact

The immediate impact of GLP-1s on food consumption is, at present, relatively limited. In terms of usage, 6% of the US adult population is currently regularly taking the medication, while about 12% have tried it during the last year. These 6% of regular users – 15 million US adults – have reduced their grocery spending by 6%, climbing to 11% for savoury snacks. The main categories affected include beer, refrigerated spreads and salad dressing, with spending down 10.4, 14.5 and 19.5 percentage points respectively, amongst GLP-1 users one year after starting their GLP-1 regimen (2). However, the percentages are still small at national level, so while a notable trend, the impact is relatively contained.

There is potential for this trend to grow as barriers to entry are removed. GLP-1s at present come at a significant cost – close to $1000/month in the US – which is not covered by insurance, unless prescribed for diabetes. So, while an approximate 40% of the US population is obese, only a portion can afford to utilise GLP-1s for weight loss. This was slated to change as the outgoing President Biden recently selected Ozempic as one of the next targets of his Inflation Reduction Act, which allowed the US to directly negotiate drug prices with manufacturers for the first time. The first round of negotiations in August 2024 saw the cost slashed for 10 of the world’s biggest medicines by 38% to 79% for 2026 (4). However, with President Trump signing an ‘initial rescissions order’ on his first day in office, reversing several of Biden’s affordable health policies, it remains to be seen whether negotiations regarding the pricing of GLP-1s will go ahead (5).

“The Ripple Effect”

Because of the presently limited direct effects, companies and retailers run the risk of underestimating the buzz created around GLP-1, which is amplifying an existing trend towards harmonious wellbeing that will only accelerate among all shoppers and consumers. As a result, additional opportunity areas are emerging – from supplements to ready meals and even cosmetics.

Supplements and Complements

We’ve already seen several GLP-1 inspired supplement launches, from Herbalife’s weight loss shake as a “complementary tool for patients on weight-loss drugs” to Biocare’s nutrition beverage to ‘ease GLP-1 side effects’ and Nestlé’s protein rich pre-meal shot ‘Boost’, designed to promote a natural GLP-1 response to a meal. While intended as a complement rather than a replacement for GLP-1s, the Boost shot also provides an accessible way for consumers to partake in the trend, coming in at $80 per month compared to nearly $1000 for GLP-1s. This small shift in the spending of non-GLP-1 users – still the vast majority – can represent a much bigger opportunity for companies who enter this space early.

Food and Beverage

In terms of food and beverage, there are several opportunities for innovation. Companies can offer low-fat, high-protein diets to support lifestyle change alongside Ozempic usage, a la Nestlé Vital Pursuit. As mentioned earlier, protein is an essential consideration for GLP-1 users, driving an almost three times increase in yoghurt consumption in U.S households where GLP-1 is used (6). Danone have seen their yoghurt sales surge amongst GLP-1 users, with their high-protein brand Oikos seeing a 40% rise in retail sales during 2024, according to Circana data (6). This compounds an existing trend shaping the CPG industry, with 85% of US adults already seeking to increase their protein intake (7).

Another opportunity for manufacturers is to offer products which naturally increase GLP-1 levels, like prebiotic fibres, curcumin and ginseng. These are all likely to see growth as ultra processed foods continue to be switched out for healthier alternatives, and non-Ozempic users seek a low-barrier to entry GLP-1 boost. Additionally, for CPGs seeking to modify rather than replace their existing portfolio, there is an opportunity to offer individually packaged products or reduced-size versions of consumer favourites. These offerings can be positioned as a self-limiting treat, as part of a balanced diet.

Beauty

Aside from the obvious food and supplement innovations, we’re also likely to see new developments in beauty as users grapple with weight loss side-effects like ‘Ozempic Face’ – a sagging, sallow appearance caused by rapid weight loss. At the moment we’re seeing this develop in the services space, as companies begin to offer treatments like WaveLift, a facial procedure to counter ‘Ozempic Face’. As GLP-1 usage becomes more widespread, this is likely to trickle down into products. As reported by Mintel:

“There’s a promising opportunity for beauty and personal care brands to tackle issues like loose skin, premature aging and hair loss, which frequently accompany rapid weight loss, despite users’ nutritional and supplemental efforts.” 

Beyond beauty, early Circana studies indicate that other categories outside of food and beverage are also poised for growth (2). These include oral care products to address the dry-mouth side effects of GLP-1s and clothing, as individuals refresh their wardrobes post-weight loss.

Key Takeaways

• Impact on Consumer Habits: As GLP-1 usage rises, the food and beverage sector faces shifts in consumer behaviour, with reduced demand for ultra-processed products and a preference for healthier, high-protein, low-sugar options. 
• New Packaging Formats: To cater to reduced appetites while retaining indulgence, CPGs can offer smaller, portion-controlled packaging e.g. miniature or single-serve versions of existing favourites.
• New Product Opportunities: CPGs can capitalize on the growing demand for supplements, protein-rich products, and ingredients that support weight loss or alleviate GLP-1 side effects, like prebiotic fibres and ginseng.
• Changing Beauty and Personal Care Needs: The side effects of rapid weight loss, such as ‘Ozempic Face’, create potential for beauty and skincare innovations targeting sagging skin, hair loss, and premature aging.
• Potential for Growth Beyond Food: Categories like oral care (for dry mouth) and clothing (for post-weight loss wardrobe updates) are growing, driven by the ripple effect of GLP-1 usage.

Note: At present we are looking to the US, as the most advanced market for GLP-1s for weight loss, to gauge the impact on the CPG industry. However, GLP-1s like Ozempic and Wegovy are much cheaper in Europe, with Wegovy coming in at $140 per month in Germany and $92 in the UK, compared to $1,349 in the US (8). As usage becomes more normalised in Europe, we can expect an uptick in ‘occasional’ usage, for example pre-summer, or prior to significant life events. It will become increasingly necessary for CPGs to facilitate healthier, protein-rich diets to avoid the ‘Yo-Yo’ effect, as consumers come on and off the drug. 

What do these changing consumer behaviours mean for your brand? Contact Sevendots today to discover more.