Tasting New Trends in

the Indian Health

Supplements Market

HIGHLIGHTS

May

2012

Health & Wellness Market to Boom

• Hectic lifestyles, growing health awareness and need to look presentable has made consumers explore healthy ways of living.

• The rising incidence of certain lifestyle-related health problems, including obesity, chronic indigestion and cardiac problems, have also given this segment a quick leg up due to the importance given to preventive care.

• Health supplements have started gaining attention in the past decade. Continuous education of customers by various players has helped to build trust and acceptance of such products in recent years to make up for the nutritional gaps in their daily diet.

• However, the market is more or less saturated with products promising to boost energy. Leaders have managed to gain a major chunk of market share, thus making it difficult for other brands to penetrate.

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Health & Wellness Market to Boom

• Consumers’ importance to healthy living has also urged food companies to offer products that play on health platform.

• Food products like low-fat milk, sugar-free sweeteners, multi-grain flour have gained popularity in recent times.

• While the health and wellness market is expanding, the competitive landscape is being redefined with healthcare as well as food companies jostling for a share of the pie.

• Thus, it is imperative for marketers to understand the gaps in the market and offer innovative products in order to gain and sustain consumer attention and thus taste success in this lucrative market space.

A landscape of the opportunity areas has been provided in the latest report from CubeX, “Tasting New Trends in the Indian Health Supplements Market”.

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Tasting New Trends in the Indian Health Supplements Market - CONTENTS • Executive Summary

The key takeaways from the report and opportunity areas to be explored have been highlighted.

• Dietary Patterns Across Regional Populations The food plate across regional communities has been analyzed to evaluate the nutritive value of food in terms of macro as well as micro nutrients.

• Nutritional Concerns in India An overview of the nutritional imbalances that prevail across demographic groups has been covered, depicting the nutritional paradox that exists in India.

• Overview of Health Supplements Market (MFDs, OTC VMS and Nutraceuticals) The market size of various categories like Malted Food Drinks (MFDs), OTC Vitamins, Minerals and Supplements (VMS) and Nutraceuticals - mainly products sold OTC or as Fast Moving Health Goods (FMHG) - has been estimated.

• Overview of Malted Food Drinks (MFDs) An outlook of the Malted Food Drinks (MFDs) market has been provided with a case study on the success of Horlicks.

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Tasting New Trends in the Indian Health Supplements Market - CONTENTS • Overview of Nutraceutical Market

This section presents the underlying needs and recent market trends in the nutraceutical market.

• In-depth Analysis of OTC VMS Market as per Nicholas Hall DB06 2012 Database

The performance of OTC VMS market along with leading brands and companies has been analyzed using the latest Nicholas Hall DB06 2012 Database (India). Category insights and a gist of the latest happenings in the OTC VMS market have also been provided.

• Overview of Health and Wellness Food Market

Companies like Britannia, Nestle, Marico and ITC have been profiled to understand how they have leveraged opportunities with ‘Better for You’ variants and functional foods in a bid to remain “healthy”.

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Tasting New Trends in the Indian Health Supplements Market - CONTENTS • Consumer & Doctor Perception of supplements

Interesting insights regarding consumer’s perceptions, motivations and barriers to the use of health supplements have been emphasized. In addition, doctor’s prescription patterns, perspectives on heath and nutrition as well as opinions on innovative product formats have been underscored.

• Stop Press

A summary of the Media Reports wherein experts have mentioned their concerns on Health Supplement Marketing in India, which confuses consumers has been highlighted.

• Conclusion

Growth drivers, challenges and way forward for health supplements market have been detailed in the concluding section.

• Appendix: Brand Case Studies

Comprehensive case studies including strategic analysis, brand scorecard and success factors of brands such as • Revital • Dabur Chyawanprash • Calcium Sandoz • Supractiv • Nutrilite and • Nutrigo have also been provided.

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Tasting New Trends in the Indian Health Supplements Market

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HIGHLIGHTS OF THE REPORT

Dietary Patterns across Regional Populations >> Food Plate vs RDA

A study was commissioned by CubeX to map the food eating habits of regional populations in relation to RDA and thus identify the gaps in the nutritional content of food.

Design:

• Target Group: Convenience sampling of 40 families (8 from each zone: North, South, West, East and Central) belonging to SEC A/B class

• The total adult diet was documented for macro as well as micronutrients

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Dietary Patterns across Regional Populations >> Food Plate vs RDA

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• The food plate comprising of major meals like breakfast, lunch and dinner across regional communities was evaluated for their nutritional value.

• The total daily consumption of various nutrients was analyzed in relation to RDA.

While Indians are more than sufficiently nourished in terms of

macro nutrients, they are deficient in terms of micro nutrients.

Each of the major meals have been analyzed and insights from the study have been mentioned in the report.

Nutritional Concerns

• India has earned the reputation of a nutritional paradox in recent times.

– Firstly, in terms of population segments being divided in terms of nutritional status (under nourished or over nourished).

– Secondly, among those who are over nourished (calorie consumption far exceeds the RDA), there is a gross deficiency of micro nutrients like vitamins and minerals.

Nutritional concerns in India relating to over and under nutrition have been addressed in the report.

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Overview of the Health Supplements market in India

• The health supplements market has been analyzed for products available either OTC or as FMHG (Fast Moving Health Goods) products.

• This includes MFDs, nutraceutical and OTC VMS products.

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Health Supplements Market

Nutra-ceuticals

Malted Food

Drinks

OTC VMS

Each of these markets have been analyzed in detail in the report.

OTC VMS Market

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• Indian OTC VMS market was valued at US$ 645 mn in 2011 (value growth of 9%), as per Nicholas Hall’s DB6 2012 database (India).

• Key segments in the OTC VMS market are Other minerals (comprising mainly of Iron supplements), Multivitamins, Other VMS (chyawanprash), Single vitamins and Calcium (contribution of over 90%). The key growth drivers have been iron and chyawanprash.

• Leading companies have built themselves on blockbuster brands, rather than leveraging the equity by expanding to other lucrative segments like nutraceuticals and herbal segments.

• The largest brand Dabur Chyawanprash, has a market share of less than 10% in the overall VMS market, an indication of clutter in the category.

The Indian OTC VMS market has been analysed in-depth to give a perspective on the opportunity areas, using Nicholas Hall DB6 2012 Database (India).

Health and Wellness Food Market

• Catering to the booming health and wellness market, provident marketers have started taking a leap into the health and wellness food market.

• Promoting products like probiotic curds was a challenge in country like India where generations of people are aware the benefits of curds and easily prepare it at home. However bringing in flavoured variants and promoting these products as healthy desserts has opened the way for these products.

• Indians are unwilling to compromise on taste and hence products which offered health benefits at the expense of taste have not performed as well as expected.

– Breakfast is considered to be the healthiest meal of the day and hence health and breakfast go well together.

• With multiple products flooding the market with similar claims, credibility of product benefits has become a barrier, apart from taste.

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An understanding of the Health and Wellness Food Market including product offerings, growth drivers and case studies of leading players like Britannia, Marico, ITC, Sunfeast have been provided in the report.

Consumers’ and Doctors’ Perceptions Towards Supplements

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Objective of the study:

Consumers

To understand the perception towards vitamins/minerals/dietary supplements.

Doctors

To understand:

1. Perception towards vitamins/minerals/dietary supplements

2. Problems with current supplements and recommendations for future products

Design:

• Consumers: Convenience sampling of 40 families (8 from each zone – North, South, West, East and Central) ,SEC A/B profile (This was a part of the initial survey done with the food plate study)

• Doctors/Influencers : 60 (across GPs ,Paeds and Nutritionists)

Consumers’ Perceptions Towards Supplements

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of the respondents surveyed, do not consume vitamins and

minerals supplements*

75%

I don’t take supplements because…

Can’t say/ No reason

Doctor didn’t advise

I don’t believe they work

They are medicines

I am healthy and I don’t need them

They are artificial, natural sources are better

Doctors’ Perceptions Towards Supplements

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• Doctors cite fatigue as the major problem plaguing a large number of patients – young adults to middle-age groups.

• Faulty food habits are the key concerns in children and young adults.

• Doctors are willing to recommend new and innovative formats.

Many such insights regarding consumers’ and doctors’ perceptions towards supplements have been captured in the study commissioned by CubeX.

Food For Thought

• In a resource abundant country like India, though more than half of the population is under- nourished, the rest of the population falls under the category of ‘improperly nourished’.

• Worrisome scenario is when the otherwise healthy lifestyle is put at the risk by the excessive use of vitamins and supplements.

• Countless urban Indians are picking up vitamins sold over the counter like they would purchase almonds or flax seeds as a health-fix. What many don't realize is that they may be doing themselves more harm than good.

• Every coin has a flip side, so do Vitamin and Mineral Supplements. Vitamins, though they are “vital”- amines for the body, should be used and prescribed only when required and in right quantities for limited time.

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Health Supplements Market : Challenges

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Price Regulations

Distribution

Market

Consumer Perceptions

Health Supplements Market : Opportunity Areas

• The market has been largely dominated by brands that play on the energy or immunity platform.

• Product launches in future that are customized would gain high

acceptance.

• On the go formats are likely to be new formats to gain momentum.

• Nutraceuticals offer multiple models for marketing and distribution.

• With regulatory, price concerns and stiff competition in the VMS OTC segment,

nutraceuticals could be the way forward for OTC marketers who

are strategizing their presence in the health supplements market.

• While food companies use H&W platform to differentiate their products in an increasingly competitive and commoditized environment, it would be

imperative to understand the diversified Indian palette and food habits to create attractive products and convert non-users to

users.

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Brand Case Studies

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An example of a popular brand in a

not-so-popular segment!

The journey from US$ 11 mn to US$ 70 mn in less than

10 years!

An Invigorated Comeback but the Fight for Survival is

Still On!

Strengthening the “backbone” of

Novartis Consumer Healthcare

A mega brand that has maintained its

growth momentum by adapting itself to the current needs of

consumers

A mega successful brand that is competing with itself,

unlike conventional brands, as a result of its

unconventional marketing strategy, making it the new

synonym for ‘success’!

CubeX Consulting

• CubeX is the Strategic Consulting and Business Intelligence Division of Sorento Healthcare Communications.

• If you would like further information about this report, please contact: reports@cubex.co.in

• For information on CubeX Consulting as well as other products and services provided by CubeX, please contact: reports@cubex.co.in

T: +91‐22‐42762100

F: +91‐22‐28754952

• Connect with us on LinkedIn at: http://in.linkedin.com/pub/cubex-consulting-a-division-of-sorento-healthcare/45/385/682

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