Ayurvedic products less than 1 per cent of India's FMCG market: Kantar Worldpanel

The low sales contribution is despite more than a dozen leading companies flooding retail shelves with hundreds of natural and herbal variants over the past few years. While 89% of Indian households purchase ayurvedic products now compared to 76% ...

Mumbai: Ayurveda may have started in the Indian subcontinent, but it still accounts for less than a percent of the country's overall fast moving consumer goods market, said a latest study.

The low sales contribution is despite more than a dozen leading companies flooding retail shelves with hundreds of natural and herbal variants over the past few years. While 89% of Indian households purchase ayurvedic products now compared to 76% four years ago, the entire segment contributes 0.8% of the total FMCG volume, according to a report by Kantar Worldpanel, the consumer insights arm of WPP. In fact, the category failed to expand its reach since last year, indicating that new households had stopped buying such products.

"In early 2017, Dabur lost the title of being the most penetrated Ayurvedic brand to Patanjali. It took Dabur a couple of years to reclaim that position in the first half of 2019 and it has managed to open up a gap between the two by early 2020. So, the onus of driving the ayurvedic segment returns to Dabur," said K Ramakrishnan, South Asia managing director of Kantar Worldpanel.


Patanjali, which challenged the dominance of multinational companies in the consumer segment over the past decade, declined 14% during the January-June period, dragging down the overall market during the period. In fact, the market for natural products has grown just 2%, compared to 3% of overall FMCG segment, a sharp deviation from earlier years when it expanded at twice the average FMCG growth rate.

However, rivals such as Dabur has been growing fast, and said factors such as rising health concerns and awareness of the side-effects of western medicines are driving consumer preferences.

"People are now more inclined to prophylactic health remedies, especially immunity-boosting products. We maintain an edge over our competitors with our 136-year-old heritage,” said Mohit Malhotra, chief executive officer at Dabur, which saw an almost 7-fold growth in demand for its Chyawanprash brand and a 34% jump in its over-the-counter business in the previous quarter.
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The spread of the Covid-19 pandemic has also to a sharper growth in consumer interest, awareness and demand for ayurvedic therapies and medicines. This has triggered companies to enter the aurveda space over the past few months.

Last week, Marico extended its edible oil brand Saffola into ayurveda by launching immunity boosting products - kadha and milk mix - and said its ImmuniVeda range is part of a wider strategy to launch more such products in either existing or newer categories. “There has been a marked change in consumption habits with consumers looking for preventive solutions in the healthy and immunity-boosting space. These include a unique blend of ingredients for added potency and are available in convenient, easy to use packs,” said Sanjay Mishra, chief operating officer – India Sales at Marico.

Over the past three years, Hindustan Unilever relaunched Ayush, acquired the Indulekha haircare brand, and launched the Citra skincare brand to spruce up its presence in the naturals space. L’Oréal introduced a haircare range under the Garnier Ultra Blends made with natural ingredients, while Colgate started selling natural toothpaste brand Vedshakti.
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