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1FEATURED INSIGHTS | INDIA ACQUIRES A TASTE FOR HEALTH AND WELLNESS Copyright © 2016 The Nielsen Company

1

F E AT U R E D I N S I G H T S

I N D I A A C Q U I R E S A TA S T E F O R H E A LT H A N D W E L L N E S SUNDERSTANDING THE HEALTH CONSCIOUS INDIAN AND THE POTENTIAL OF THE HEALTH AND WELLNESS MARKET

• Health and wellness foods is an INR 10,352 croremarket with agrowthrateofabout10%.

• Fortif iedfoodswithincrementalnutrientsgainfavourwithIndianconsumerswhoarewillingtospendmoreonhealthyfoods.

• Men focus on fortif ication and nutrients, while women focus on

makingdietarychoicesthatpreventhealthdisorders.

• Micromarketing,withitsadvantageofprecisiontargetingwillgivemanufacturerstheedgeinstrategizingtheirgo-to-marketplans.

Cultural factors and eating habits make Indians prone to weight issues,

and with consumers now judging themselves on international body-

image parameters, the general consensus is that a concerted effort on

health and wellness is imperative.

DELIVERING CONSUMER CLARITY

THE HEALTH AND WELLNESS CONSUMERIndian consumers consider fortified foods with incremental nutrients

like protein, fibre, vitamins, calcium and minerals, an important

consideration while making a purchase. When asked what tips the

scales in favour of certain packaged foods over others, respondents of

our survey picked the promise of all-natural ingredients, high protein

and high fibre content as favourites. The message in this for brands is

to call out auxiliary health benefits rather than merely tagging products

as ‘healthy’.

2 FEATURED INSIGHTS | INDIA ACQUIRES A TASTE FOR HEALTH AND WELLNESS

Source: Nielsen Global Health / Wellness Survey

Responses in the chart are an answer to the question ‘How important are the following health attributes in influencing you to purchase more of a particular food/ food products? - Very Important’

Consumers clearly look at labels on packaged food and are willing

to pay more for products that make the cut. This is especially true of

products with added nutrients, rather than products with low fat or

gluten content.

HEALTH ATTRIBUTES PERCEIVED TO BE MOST IMPORTANT

LABELS THAT MAKE CONSUMERS LOOSEN THEIR PURSE STRINGS

0% 10% 20% 30% 40% 50% 60% 70%

Glut

en fr

ee

Low/

No

fat

Low/

No

calor

ies

Who

le gr

ain

No

artifi

cial fl

avor

s

No

artifi

cial c

olors

Gen

etica

lly m

odifi

ed

orga

nism

(GM

O) f

ree

Org

anic

All n

atur

al

No

high

fruc

tose

corn

sy

rup

Porti

on co

ntro

l

Low

/ No

carb

ohyd

rate

s

Loca

l her

bs/ i

ngre

dient

s

Ca

eine f

ree

High

in p

rote

in

High

in fi

ber

Low

salt/

sodiu

m

Nat

ural

flavo

rs

Low

suga

r / S

ugar

free

Ingr

edien

ts so

urce

d su

stain

ably/

fair

trade

Vita

min

forti

fied

Calc

ium fo

rtifie

d

Min

erals

forti

fied

Micr

onut

rient

forti

fied

Rich

in u

nsat

urat

ed fa

ts

Mad

e fro

m ve

geta

bles/

fruits

Lo

w / N

o ch

oleste

rol

CONSUMERS ARE LOOKING AT LABELS ON PACKAGED FOOD AND ARE WILLING TO PAY MORE FOR PRODUCTS THAT MAKE THE CUT. THIS IS ESPECIALLY TRUE OF PRODUCTS WITH ADDED NUTRIENTS, RATHER THAN PRODUCTS WITH LOW FAT OR GLUTEN CONTENT.

1.30

ALL NATURAL

1.20

HIGH IN FIBER

1.20

NATURAL FLAVORS

1.06

MINERAL FORTIFIED

1.20

HIGH IN PROTEIN

Source: Nielsen Global Health / Wellness Survey

Responses in the above chart are an answer to the question ‘How willing are you to pay a premium for foods that contain health attributes? - Very Willing’. Over-indexed attributes with 1.0 being the average.


CONSUMER WILLING TO SPEND MORE FOR HEALTHY VARIANTSApart from specific ingredients that pique consumer interest, certain

variants of foods too command a much higher rate of premium on the

back of their health and wellness attributes. Healthy variants of noodles

and tea top the list with premium rates of above 70%.

Source: Nielsen

AVG PRICE PER KG/L PREMIUM CHARGED(%)

PACKAGED ATTA

CATEGORIES

33 48 44

22

72

82

24

106 127

301 518

150 273

106 131

BASE H&W

REFINED OIL

TEA

NOODLES

BISCUITS

PORTRAIT OF A FORTIFICATION SEEKERConsumers driving the move to fortified foods are conscious about

brands and labels on packaged foods. Four distinct traits characterise

this consumer.

• They are loyaltotrustedbrands and go as far as to buy only from

producers they trust.

• They read labels for nutrition content, believe health claims and

follow portion guidance.

• They are willingtopayapremium for foods that meet their approval.

• They monitorfoodintakeanddiet, and are willing to sacrifice taste

for health.

Statistically, one of every two consumers consider themselves either

overweight or underweight. Two of every five are currently trying to lose

weight and physical exercise is the top action taken by consumers in

India who are trying to stay in shape.


HOW INDIAN MEN AND WOMEN APPROACH THIS WEIGHTY ISSUEThe Indian male leans towards fortification and nutrients in his food

and therefore buys organic, natural and fortified foods. On the other

hand, women who also seek organic and natural foods stress more on

making dietary choices to prevent health disorders and are willing to

forgo taste in the bargain.

ARE YOU CURRENTLY TRYING TO LOSE WEIGHT?

WHICH OF THE FOLLOWING ACTIONS ARE YOU TAKING TO LOSE WEIGHT?

YES 43%

NO 57%

VERY OVERWEIGHT

SOMEWHAT OVERWEIGHT

ABOUT THE RIGHT WEIGHT

A LITTLE OVERWEIGHT

UNDERWEIGHT

2% 8% 27%

51%

79%

12%

BATTLE OF THE BULGE

65% 11% 10% 5%

Source: Nielsen Global Health/ Wellness Survey

DOING PHYSICALEXERCISE

CHANGING MY DIET

TAKING DIET PILLS/BARS/

SHAKES

TAKING MEDICINE

PRESCRIBED BY MY DOCTOR

OTHER


46% 40%

All these insights from the Nielsen Global Health and Wellness

Survey point to the abundant market opportunities that lie ahead for

the segment. What will define success for food brands is a measured

approach that drives effectiveness, and is cognisant of consumer

aspirations.

WHAT MEN WANT: FORTIFICATION

WHICH OF THE FOLLOWING ACTIONS ARE YOU TAKING TO LOSE WEIGHT?

ORGANIC

60% 53%

HIGH IN FIBER

59% 54%

HIGH IN PROTEIN

59% 47%

ALL NATURAL

51% 43%

VITAMIN FORTIFIED

48% 43%

MINERAL FORTIFIED

MALE FEMALESource: Nielsen Global Health/Wellness Survey

Responses in the chart above are an answer to the question ‘How important are the following health attributes in influencing you to purchase more of a particular food/food products? - Very Important’

WHAT WOMEN WANT: MONITORING DIET

I AM WILLING TO SACRIFICE TASTE FOR A

HEALTHIER OPTION

30% 38%

I CHOOSE LOCAL, NATURAL AND ORGANIC ALTERNATIVES

WHENEVER POSSIBLE

40%34%

I ACTIVELY MAKE DIETARY CHOICES TO HELP PREVENT CERTAIN HEALTH

CONDITIONS SUCH AS, OBESITY, DIABETES, HIGH CHOLESTEROL,

HYPERTENSION

35% 42%

I MOSTLY SHOP FOR FOODS AT SPECIALTY RETAILERS THAT

SELL A WIDE VARIETY OF HEALTHY FOODS

36% 42%

HEALTHY HYDRATION IS A PART OF MY LIFESTYLE

36% 42% MALE FEMALE

Source: Nielsen Global Health/Wellness Survey


HEALTH & WELLNESS FOODS: SIZE OF THE OPPORTUNITYHealth and wellness foods is an INR 10,352 crore market. With a growth

rate of about 10%, it is a promising segment for manufacturers to

tap into. Categories that are in vogue like oats noodles and green tea

promise to drive growth.

HEALTH AND WELLNESS FOODS IS AN INR 10,352 CRORE MARKET. WITH A VALUE GROWTH RATE OF ABOUT 10%, IT IS A PROMISING SEGMENT FOR MANUFACTURERS TO TAP INTO.

CATEGORIES DRIVING GROWTH IN HEALTH AND WELLNESS FOODS

The fast growth of milk food drinks and cereals demonstrate that the

most important meal of the day may well provide the next impetus to

growth. Consumers are moving away from traditional breakfast options

like ‘parathas’ to a wider and healthier assortment of cereals, oats and

fortified milk food drinks.

SNACKS

PACKAGED GROCERY

HEALTHY BISCUITS

MULTIGRAIN ATTA

MILK FOOD BEVERAGES

SALES GROWTH

HEALTHY OILS

GREENTEA

SUGAR SUBSTITUTE

1155 Cr.

1,205 Cr.

5,180 Cr.

1,250 Cr.

165 Cr.

258 Cr.

COOKING AND OTHERS

WHEAT AND OATS NOODLES

187 Cr. 951 Cr.

BREAKFAST CEREALS

Source: Nielsen

5%

7%

11%

9% 4%

14%

52%

10%

BEVERAGES

ATTA


THE MOST HEALTH CONSCIOUS OF THEM ALLA granular view of the geographies that are driving the shift towards

health and wellness foods, shows that the south India is the earliest

to adopt the trend, followed by the east. The west and north will need

some encouragement from manufacturers to follow suit.

HEALTH AND WELLNESS FOODS: REGIONAL PREFERENCES

Source: Nielsen

25%

25%

17%

13%

17%

30%

21%

28%

17%

41%

31%

36%

HEALTHY BISCUITS

GREEN TEA

HEALTHY OILS

HEALTH & WELLNESS 12% 14% 8% 7%

1% 16% 8% 12%

54% 73% 59% 43%

11% 35% 25% 28%

13% 13% 5% -7%

NORTH EAST WEST SOUTH


THE CHANNEL OF CHOICE?Indian shoppers mostly turn to traditional trade stores for their

provisions, with health and wellness foods being no exception. While

this holds true across most categories, instant noodles and cereals

buck the trend with healthy sales in modern trade outlets.

While insights on categories, consumer aspirations and regional usage

patterns help strategise sales and marketing efforts, an important piece

of the puzzle is identifying opportunity areas through micro-marketing.

Sweeping generalisations run the risk of over-simplifying the market

opportunity, and savvy marketers have begun to realise that precision

targeting may be the key differentiator in clinching market share.

MTTT

Source: Nielsen

FMCG 93% 7%

93% 7%H&W

TRADE CHANNEL SPLIT GENERAL TRADE MODERN TRADE

H&W

7%I93% 29%I71%

HEALTHYOILS

11%I89%

MFD

HEALTHYBISCUITS

15%I85%

GREENTEA

44%I56%

BREAKFASTCEREALS

44%I56%

OATS AND ATTANOODLES

13%I87%


REACHING THE HEALTH CONSCIOUS INDIANTHE MICRO MARKETING OPPORTUNIT Y

When compared to developed nations, and even other BRIC countries,

India allocates a smaller proportion of the national Gross Domestic

Product (GDP) to health. However, private expenditure is above most of

the developed countries. Clearly, there is a scope to work on efficiencies

and work towards a healthier community by identifying locations that

need intervention by multiple stakeholders to boost investment on

health, and thereby improving the residents’ living standards.

In India, about 65% of operational beds are in the private sector, and

more than 85% of healthcare spends are by the same sector.

WHEN COMPARED TO DEVELOPED NATIONS, AND EVEN OTHER BRIC COUNTRIES, INDIA ALLOCATES A SMALLER PROPORTION OF THE NATIONAL GROSS DOMESTIC PRODUCT (GDP) TO HEALTH. HOWEVER, PRIVATE EXPENDITURE IS ABOVE MOST OF THE DEVELOPED COUNTRIES.

HEALTH EXPENDITURE: INDIA VERSUS OTHER BRIC NATIONS

COUNTRIES

BRAZIL

CHINA

INDIA

RUSSIAN FEDERATION

OUT-OF-POCKET HEALTH EXPENDITURE

(PERCENTAGE OF PRIVATE EXPENDITURE)

HEALTH EXPENDITURE AS PERCENTAGE OF

GDP

57.76

76.65

85.88

92.42

9.67

5.57

3.97

6.55

Note: Out-of-pocket expenditure is any direct outlay by households, including gratuities and in-kind payments, to health practitioners and suppliers of pharmaceuticals, therapeutic appliances, and other goods and services whose primary intent is to contribute to the restoration or enhancement of the health status of individuals or population groups. It is a part of private health expenditure.

Source: World Bank, 2013


In order to understand and then activate a healthier community, a good

place to start would be to develop a method to identify locations with

different levels of performance in health. By analysing at the micro

level, Nielsen attempted to identify districts on the basis of health

performance measures. This was done in two steps.

A.Amulti-dimensionalindexwascreatedbyaggregatingthe followingparameters:

• HealthCareServices

o Deliveries attended by skilled personnel

o Children Fully Immunized (12-23 months)

o Woman with >3 Antenatal Care

• HealthInfrastructure

o No. of hospitals per person

o No. of registered doctors per person

• OutcomeMeasures

o Inverse of infant mortality rate

o Inverse of under 5 mortality rate

o Inverse of malnourished children

The index is derived in the following way: First, we standardised each

of the variables so that all the variables were in same scale, i.e., 0 to 1.

Second, to ensure objectivity, equal weights were assigned and hence

an arithmetic mean was used to calculate composite index.

B.OnthebasisofthederivedHealthIndexvalues,Districtswereclusteredintofourquartiles;‘Leaders’,‘Progressive’,‘Aspirers’and‘NeedImprovement’

From an analysis of these quartiles or clusters, it emerges that the

proportion of ailing people is lower in the leading cluster and people

there are consequently spending less on treatment. Moreover, there are

fewer children with malnutrition in leading clusters and understandably,

these consumers spend more on prevention.


Source: Estimates using NSSO-71st Round, 2013-14

Leaders: Districts leading in health performanceSource: NSSO, Nielsen Micro Marketing and Economics

Source: Estimates using Indian Development Landscape, MME-Nielsen

PROPORTION OF AILING PERSON LOWER IN THE

LEADING CLUSTER VIS-À-VIS OTHERS: SPENDING

LESS ON TREATMENT

PROPORTION OF AILING PERSON (PER ‘000)

MALNUTRITION OF CHILDREN (LESS THAN 5 YEARS)

MAL-NUTRITIOUS CHILDREN LOWER IN LEADING CLUSTER VIS-À-VIS OTHERS:SPENDING MORE ON PREVENTION

79

101

124

127

LEADERS

PROGRESSIVE

ASPIRERS

NEEDIMPROVEMENT

16.1

28.9

44.1

47.6

PREVENTIVE MEASURES ARE NOT A PRIORITYConsumers spend on medical treatment because they have to, whether

they can afford it or not. However, spending on prevention is perceived

as expendable. Only when consumers feel comfortable with disposable

income, do they consider spending on prevention. What is heartening

is that though the ability to spend is highest in the leading cluster, the

income of people across all four of our district clusters are increasing.


Despite increasing incomes, only the leading cluster spends a

substantial proportion of the household expenditure on health and

preventive measures.

AFFLUENCE LEVEL:PERCENTAGE OF

HOUSEHOLDS EARNING MORE THAN RS. 10 LAKH

ANNUALLY

POVERTY LEVEL:PERCENTAGE OF HOUSEHOLDS EARNING LESS THAN RS. 75,000 ANNUALLY

2004 2009 2014

Source: Nielsen Micro Marketing and Economics


PERCENTAGE OF HOUSEHOLD EXPENDITURE ON HEALTH TO TOTAL EXPENDITURE

6.0%

4.3%

3.2%

3.3%

LEADING DISTRICTS

PROGRESSIVE DISTRICTS

ASPIRERS

NEED IMPROVEMENT

61%

46% 28%

59%

44%

28%

63% 50%

32%

67% 53%

34%

LEADINGDISTRICTS

PROGRESSIVEDISTRICTS

ASPIRERS

NEEDIMPROVEMENT

5%

9% 18%

4% 8%

16%

3%

6% 12%

2%

4%

10%


1Improved drinking water facility as defined by WHO include-household connection, public standpipe, borehole, protected

drug well, protected spring, rainwater collection. 2Improved sanitation facility as defined by WHO include-Connection to a public sewer, connection to a septic system,

pour-flush latrine, simple pit latrine, ventilated improved pit latrine.

A HEALTHIER COMMUNITY THROUGH MICRO MARKETING

A granular look at each cluster helps understand where each locality stands on health and

what their priorities are. All the stakeholders in the health and wellness market can derive their

distinct lessons from the four district clusters.

LEADERS:DISTRICTSWITHHIGHEXPENDITUREONHEALTHANDAHIGHHEALTHINDEX

Consumers in leading districts can afford to take measures for the upkeep of their health. They

also display a low level of ailments and spend more on preventive measures. This segment can

be approached with the knowledge that they can spend on expensive health items.

PROGRESSIVE:DISTRICTSWITHMODERATELYHIGHEXPENDITUREONHEALTHANDAPROGRESSINGHEALTHINDEX

Consumers in this cluster are low on ailments with gradually improving health statistics. They

are warming up to spending on preventive measures. Brands looking at this segment can focus

on educative content to drive demand.

ASPIRERS:DISTRICTSWITHLOWEXPENDITUREONHEALTHANDANIMPROVEMENTINSOMEMEASURESOFTHEHEALTHINDEX

These consumers can afford little but have a high prevalence of ailments. It is safe to assume that

they will spend more on treatment. Since it will be largely non-profitable, and since treatment

requirements are comparatively high, there needs to be government or NGO intervention to

improve the health situation.

NEED IMPROVEMENT: DISTRICTSWITH LOW EXPENDITURE ON HEALTH AND A LOWHEALTHINDEX

Consumers in this segment have very low incomes and require government intervention first to

make a significant improvement.

Micro marketing works to improve efficiency through precision targeting. To illustrate, the city

of Lucknow can be mapped to mark out the four clusters. Health Index at the neighbourhood

level as defined earlier, is an aggregation of (A) health care services, (B) health infrastructure (C)

outcome measures. The parameters used to measure each of the categories is redefined based

on the information available at the neighbourhood level:

• Health care services- medical services, pharmaceuticals.

• Health infrastructure- hospitals, registered doctors.

• Outcome measures- factors that influence outcome directly.

• Improved drinking water 1facility, improved sanitation facility2.

Neighbourhoods within the city can be classified by their Health Index and their household

expenditure on health.


The focus of brands and manufacturers in this instance would be on the

encircled clusters of ‘Leaders’ and ‘Progressive’.

Whether ‘Leaders’, ‘Progressive’, ‘Aspirers’ or ‘Need Improvement’,

consumers across segments are increasingly waking up to the difference

health can make to their lives. Statistics, trends and micro marketing

strategies are tools that marketers can use to optimise the massive

opportunity that promises to grow despite any residual economic

uncertainty in the country.

MICRO MARKET IDENTIFICATION FOR ACTIVATION:ILLUSTRATION OF LUCKNOW MICRO MARKET

ASPIRERS-IMPROVINGIN HEALTHINDEX HIGHIN HEALTH EXPENDITURE

20000

18000

16000

14000

12000

10000

8000

6000

4000

2000

00 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9-0.1

NEEDIMPROVEMENT

PROGRESSIVE-MODERATELY HIGHIN HEALTH INDEX-LOW IN HEALTHEXPENDITURE

LEADERS-HIGH INHEALTH INDEX-HIGH IN HEALTHEXPENDITURE

PER

HO

USE

HO

LD E

XPEN

DIT

URE

ON

HEA

LTH


Rajiv Gandhi Ward1st NCL

Maha kavi JaiShankar PrasadNCL

HEALTH INDEX


MANOJ KULKARNI

DIRECTOR

NIELSEN INDIA

MINAKSHI CHAKRABORTY

SENIOR MANAGER

NIELSEN INDIA

NEHA AHUJA

SENIOR MANAGER

NIELSEN INDIA

ABOUT THE AUTHORS

ABOUT NIELSENNielsen Holdings plc (NYSE: NLSN) is a global performance management

company that provides a comprehensive understanding of what consumers

watch and buy. Nielsen’s Watch segment provides media and advertising

clients with Total Audience measurement services for all devices on which

content — video, audio and text — is consumed. The Buy segment offers

consumer packaged goods manufacturers and retailers the industry’s only

global view of retail performance measurement. By integrating information

from its Watch and Buy segments and other data sources, Nielsen also

provides its clients with analytics that help improve performance. Nielsen, an

S&P 500 company, has operations in over 100 countries, covering more than

90% of the world’s population.

For more information, visit www.nielsen.com.

Copyright © 2016 The Nielsen Company. All rights reserved. Nielsen and

the Nielsen logo are trademarks or registered trademarks of CZT/ACN

Trademarks, L.L.C. Other product and service names are trademarks or

registered trademarks of their respective companies.

Mani Goyal from the Nielsen Industrial Market Research team contributed to

this issue of Featured Insights.

featured insights - nielsen · like protein, fibre, vitamins, calcium and minerals, an important...

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