The Impact of Consumer Behavior on Nutraceutical Industry- Amidst and Post Pandemic
By, Mr. Vikram Kelkar
Group Managing Director – Hexagon Nutrition
14th October 2020 - 2:00 PM - 2:30 PM
The demand growth of food & health ingredients is constantly being fueled by evolving customer preferences. The change in customer preference from nutrition-based to wellness-specific foods has expanded the growth prospects for the demand for food & health ingredients. Over the past couple of decades, the ingredients industry has grown dramatically with customers seeking functional foods that provide beneficial alternatives to any health problems they may face.
With this backdrop, our Group Managing Director, Mr. Vikram Kelkar presented an Indian & Global overview of the nutraceutical industry amidst & post the pandemic at the Fi India & Hi Virtual Expo 2020 held recently. Apart from this he also shared the impact of the pandemic on the nutraceutical innovations in India and the shift in consumption habits in the past 6-7 months.
He also guided what are the possible growth opportunities in the middle of all constraints and challenges.
We have summarized the key takeaways.
1. Mr. Vikram Kelkar simplified & segregated the industrial jargon of Nutraceuticals under 2 broad heads:
· Functional Food & Beverages (fortified food, iodized salt, energy sports drinks, fortified juices, etc)
· Dietary Supplements (Vitamin, Mineral, Herbal & other supplements)
2. He highlighted that the demand for Nutraceuticals with health benefits is one of the key factors driving market growth. The Nutraceutical Market is expected to grow and rise to $336 bn by 2023.
3. USA, Europe & Japan are attaining maturity & dominate more than 90% of the industry. The industrial focus is now shifting to developing economies especially those across Asia-Pacific, including India.
4. There is an excellent opportunity for us in India to grow in the business of Nutraceutical and nutraceutical ingredients as the market is opening up widely. As per a recent report of the Economic Times, the India Nutraceutical Industry is expected to grow at a CAGR of 21% occupying at least a 3.5% share of the global market by 2023.
5. Seeing the impact of COVID-19 on consumer behavior he quoted that, “As per the Boston Consulting group’ COVID-19 consumer sentiment survey 2020, new consumer priorities such as health supplements, fresh foods are seeing a sustained spike.”
6. Preventive and cautious living is the new sprouting theme in COVID times. From Lockdown 1.0 to Unlock 4.0 we have seen a drastic shift from health and economy concerns to personal anxiety/mental health to resilience and prevention.
7. He also showcased the findings of the survey which highlighted that the net spending, from April 2020 to August 2020 amid the pandemic positively hovered around health supplements & fresh foods thus accelerating in the growth trajectory.
8. The BCG COVID-19 consumer sentiment survey 2020 also concluded the fact that there has been a rise in health & wellness however the adoption of healthy foods has outgrown (by 30%) vis-à-vis health-related fitness (which is 20%) activity bar in the past 3-4 months.
9. A recent Mintel survey has shown shifts in the consumption habits of the Indians. The demands for Vitamin A, C & D supplements have spiked tremendously across all levels of society. A recent incident that Vikram encountered saw a Rickshaw puller buying Vitamin C tablets signifying the “shift” level of awareness that has set in amidst the pandemic.
10. India has proactively graduated to buying immunity building nutraceuticals as compared to buying earlier for chronic care ailments such as Osteoporosis, Arthritis & High Blood pressure.
11. Because, India leads the APAC market with the highest number of innovative food, beverages & supplements focusing on Immunity since the pandemic has set in, there is a burning need for evidence-based nutraceuticals & regulations.
12. He emphasized that COVID-19 has brought a better and enhanced focus on overall health and wellness as immunity based products would be in demand post-COVID-19 pandemic as well. Although, factors such as new dosage formats, taste, flavor, innovation beyond usual supplements format can prove to be a game-changer.