Advertisement

SOUTHERN CALIFORNIA ENTERPRISE : Alacer to Supplement Its Sales Efforts With Ads : Nutrition: Word-of-mouth sustained the Irvine firm for 23 years. But a robust health-food industry is prompting change.

Share via
SPECIAL TO THE TIMES

Jay Patrick, just shy of his 83rd birthday, goes to work every day in offices cluttered with electronic gadgetry and books and articles about health and nutrition. A sofa bed in one corner is always open so he can take his daily 22-minute nap.

Patrick, the founder and president of a 23-year-old Irvine company that makes vitamins and other food supplements, counted the late Linus Pauling among his friends. In fact, he credits the Nobel-prize-winning chemist with getting him into his line of work.

Now, after years in relative obscurity, Patrick has decided to raise the profile of Alacer Corp. by making a push into the rapidly growing health-food segment of the retail industry. For the first time, Alacer, which sells its products in health-food stores nationwide, will begin advertising its full line of vitamin and mineral tablets, bottled water with electrolyte additives and vitamin-enriched skin-care products.

Advertisement

Privately held Alacer is timing its marketing move well, observers and analysts say. The vitamin industry as a whole has seen sales grow steadily in the 1990s.

Total sales of food supplements were a record $4 billion for 1993, according to the Council for Responsible Nutrition, a trade group based in Washington. That represents a 10% increase from the previous year.

Tony Cherbak, a retail analyst with Deloitte & Touche, said the health-food and food-supplement industries had not been tracked carefully until recently because they made up such a small segment of the total retail market.

Advertisement

The rise in sales has coincided with the nation’s increased health consciousness, the aging of the population, medical reports on the benefits of vitamins, and the cost of medical care.

“People can’t afford to be sick because of the high cost of health care,” said Bernie Bubman, co-founder of Great Earth Vitamin Stores, a Los Angeles-based chain. “So they are looking for alternatives.”

Whatever the reasons for the boom, it bodes well for Alacer, which employs about 100 and estimates its annual revenue at about $6 million.

Advertisement

The company already has a devoted customer base, including some celebrities. Supermodel Cindy Crawford, for example, has touted the company’s E-mergen-C vitamin supplement in fashion magazine articles.

But up to now, Alacer’s growth has been achieved strictly by word-of-mouth. The company has no sales staff--its products are shipped to distribution companies that fill retailers’ orders.

“The company has always been a product-driven company,” said Michael Maynard, Alacer’s newly hired director of marketing. Little money or effort went into promotions, he said, largely because Patrick is not a typical businessman. He never mentions the bottom line, and terms like operating margin are rarely heard.

“As I got older,” Patrick said, “I became more interested in finding ways to live a longer and healthier life.”

Indeed, Patrick is one of his own best customers. He takes 10 grams of vitamin C every day--about 150 times the recommended daily allowance.

That and his friendship with Pauling, who first advocated large doses of vitamins to stave off illness, led Patrick into the food supplement business. He never had a marketing plan or an advertising budget.

Now, though, “that is all changing,” Maynard said. He would not say exactly what he has in mind except that “the advertising budget will be brought up to more than the national average, which is about 4% of sales.”

Advertisement
Advertisement