Covid-19 has created the biggest seismic shift taking health and immunity to the center stage. Approximately 94 percent of Indians are worried about their family’s health against 82 percent globally. Consequently, Indian consumers have opened their wallets towards fitness classes and activities, consuming natural foods, health supplements, and following specialized diets.
In fact, 52 percent of Indian consumers think changes in their approach to mental wellbeing will persist beyond Covid-19, globally it is just 39 percent, according to a report by EY India.
Angshuman Bhattacharya, National Leader (Consumer Product & Retail Sector), EY India said, “While some see this as a short-term phenomenon, we expect this phase to catalyze a larger acceleration in the propensity towards personal health, hygiene, fitness, and holistic nutrition. European and Asian nations have adopted functional foods and supplements, the Indian consumer is still predominantly showing a preference for “better for you” foods and home remedies. Ayurveda and herbal are increasingly becoming “back to roots” answers to modern problems.”
Most large food players have adopted functionalization in their product portfolio to differentiate and drive value for consumers. 40 percent of Indian respondents stated that they will pay a premium for products promoting health and wellness, which is higher than their global counterparts (29 percent). This is also indicated through the 14 percent CAGR of the health food and beverages segment, during FY18-21, to reach Rs 700 billion in FY21.
Similarly, the dietary supplements market In India grew at a CAGR of 15 percent to reach Rs 331 billion in FY21. This segment, always considered to be high potential given the growing lifestyle diseases, has witnessed an accelerated adoption curve, post-Covid-19. Over the last year, the demand for herbal supplements and vitamins and minerals have witnessed a growth of over 25 percent.
“In the next five years, we expect consumer product companies to invest in demand creation and increasing consumer education using virtual equivalents of multilevel marketing (MLM), medical representative models, social media-based influencing, and direct-to-consumer (D2C) approaches. We expect this segment to grow at over 35 percent for digitally integrated omnichannel players, and 20-25 percent for offline brands,” Angshuman further added.
Further, the wellness and vitality segment has seen increasing fund-raising in the past few quarters both in the venture and early growth stage. There has also been a strong strategic interest in the segment. As per the EY report, the market should see a spate of M&A transactions led by both global and local majors, as early-stage investments mature.
Source: indianretailer.com
