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Consumer companies take to nutraceuticals as health consciousness rises

Moneycontrol logo Moneycontrol 23-05-2022 Devika Singh
Consumer companies take to nutraceuticals as health consciousness rises © Moneycontrol Consumer companies take to nutraceuticals as health consciousness rises

Rohan Mishra, a 30-year-old marketing professional, realised after a routine health check-up just before the pandemic that his triglycerides, a type of fat, were alarmingly high. A high level of triglycerides in the blood is often linked to higher chances of heart conditions and, hence, Mishra was worried.

He spent the next two years following a strict workout and diet regime to shed excess body weight and eat healthier. However, his diet was not able to fulfil the nutritional requirements.

“I was trying to eat a diet rich in ‘Biotin’ as it helps in cutting down triglycerides, but how much tuna, sardine or salmon can you eat in a week?” Mishra asked. “Ultimately, I decided it was easier to supplement my diet with Biotin tablets to fulfil the nutritional requirement.”

The perception of nutraceuticals has changed of late, with consumers resolving to adopt a healthier lifestyle in the wake of the pandemic. Sample this: retail pharmacy chain Wellness Forever’s sales of nutraceuticals have almost doubled from pre-pandemic times.

“Nutraceutical consumption, if you include products like kadha, chyawanprash, along with vitamin and calcium supplements, was on the rise in the last five years but the pandemic has completely rebooted the segment,” said Gulshan Bakhtiani, founder of Wellness Forever.

The Indian market for nutraceuticals is estimated at $5.6 billion (Rs 42,000 crore) in FY21 and is growing at a CAGR of 10 percent, according to business research and intelligence services firm PGA Labs.

“The segment is seeing a strong growth in the last few years, which is primarily propelled by a paradigm shift in the mindset of Indian consumers towards preventive health maintenance. This is expected to grow at a fast pace,” said Nitin Jain, managing director of Protiviti in India.

Consumer brands in the fray

With the rapid growth in the nutraceuticals market, consumer goods companies have quickly moved to tap the segment. While Dabur India and Himalaya Wellness are known for their health and wellness portfolio, now, even Hindustan Unilever and Nykaa have a presence in the segment.

Hindustan Unilever, which makes the malt-based drink Horlicks, launched Horlicks Nutri Gummies targeting children in April. The company introduced the product on the Horlicks direct-to-customer channel.

E-commerce company Nykaa entered the segment in April by partnering with D2C brand incubator Onesto Labs to launch a new company Nudge Wellness.

According to Nykaa founder Falguni Nayar, nutraceuticals, a recent introduction to the beauty marketplace, is one of the fastest-growing categories on Nykaa. The founder indicated that it might introduce the category in its offline stores too, based on its performance.

D2C entities such as The Man Company and Wow Skin Sciences are launching products in the segment. Emami-backed male grooming brand The Man Company launched MinStrips dissolvable vitamin strips targeting men in February. While personal care brand Wow Skin Science, which has been present in the category since 2013, now plans to launch more products.

“We aim to fill the white space (product gap) in the category and plan to go explosive by launching as many as 100 stock keeping units (SKUs) in it this year,” said Manish Chowdhary, founder of Wow Skin Science.

‘Gummies’ for health

Gummies and strips, an export-driven market so far in India, has gathered steam with the entry of new-age brands like Power Gummies and Atmantan Naturals. Strips and gummies have been growing in double-digits annually.

In a bid to tap this rapidly growing segment, new and old companies including Hindustan Unilever and The Man Company are introducing products in the gummy format. Gummies, industry stakeholders indicated, might also be the answer to the segment’s biggest challenge.

“Consumers are reluctant to consume nutraceuticals in the form of pills or tablets as it is akin to taking medicines,” said Chowdhary of Wow Skin Science. The company, which draws about 20 percent of its business from the category, has started making products in the form of powders and will roll out soon gummies too.

There are other challenges as well.

Arindam Gupta, executive vice president of PGA Labs, said the industry needs a regulatory framework as it gains popularity in the Indian market.

“Today, many fake and low-quality products in the market are making false claims to lure consumers and tarnish trustworthiness. Another challenge is to make the products more affordable to gain better penetration in the non-metro and tier-1 cities,” he said.

Lack of clarity on what qualifies as a nutraceutical is also a deterrent to the growth of the industry. The Indian government distinguishes between a nutraceutical and a pharmaceutical based on dosage and this is another deterrent, according to experts. A Vitamin C tablet in the nutraceutical category can have a dosage of 60-90 milligrams, while as a pharmaceutical it can go up to 1,000 mg.

“The recommended daily allowances of critical products have been kept very low. So people hesitate to spend money on nutraceuticals because they feel that they’re not getting their money’s worth when they buy a low-dosage format,” said Sanjaya Mariwala, executive chairman of OmniActive Health Technologies and founder president of the Association of Herbal and Nutraceuticals Manufacturers of India.

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