Consumer Trends in India: Opportunities in Health and Wellness Food & Beverages

Introduction

This report is based on trends observed in terms of changing Indian lifestyles, increasing health and wellness awareness and consumers' food and beverage product choices. This report is aimed at enabling the NPD and marketing team in FMCG companies to identify potentials in terms of product formulation and packaging, and emerging consumer segments.

Scope

*Identifies current and emerging health and wellness concerns amongst Indians

*Explores drivers and inhibitors behind consumers' product choices of food and beverages with health and wellness claims

*Focus areas for FMCG companies in terms of product formulation and packaging to explore opportunities across various categories

*Geographic scope is India

Highlights

The key emerging health concerns amongst Indians include diseases of the heart and digestive system, obesity, bone and joint pain, depression and anxiety, lack of energy and stamina and sleeplessness. While some of these are being aggressively addressed by manufacturers, there are some others which still offer a scope for product development.

The growing awareness amongst Indian consumers regarding several ingredients and their associated health benefits is making them more inclined to use nutritional information very often to make product choices. Hence there is a demand for food and beverages with health claims, and Indians are making a conscious attempt to include them in their diet.

Health food and drinks should be made available in convenient package formats to appeal to the changing consumption patterns. In a crowded market place with several products having health claims, sustained purchase and consumption is driven by product packaging, size, format aimed at providing convenience of usage to the consumers.

Reasons to Purchase

*Information on current consumer and product trends in the health and wellness food and beverages market

*Insights into Indian consumer attitudes towards purchase and consumption of such health and wellness food and beverages

*Identifies opportunities in terms of product formulation, packaging and positioning for food and beverages companies in India


Report Highlights
The key emerging health concerns amongst Indians include diseases of the heart and digestive system, obesity, bone and joint pain, depression and anxiety, lack of energy and stamina and sleeplessness. While some of these are being aggressively addressed by manufacturers, there are some others which still offer a scope for product development.

The growing awareness amongst Indian consumers regarding several ingredients and their associated health benefits is making them more inclined to use nutritional information very often to make product choices. Hence there is a demand for food and beverages with health claims, and Indians are making a conscious attempt to include them in their diet.

Health food and drinks should be made available in convenient package formats to appeal to the changing consumption patterns. In a crowded market place with several products having health claims, sustained purchase and consumption is driven by product packaging, size, format aimed at providing convenience of usage to the consumers.
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Overview 1
Catalyst 1
Summary 1
Table of Contents 3
Table of figures 4
Table of tables 5
THE FUTURE DECODED 6
INTRODUCTION: Food and beverage products delivering health and wellness benefits have potential for robust growth in India 6
TREND: Differing segments of Indian consumers exist, each with a differing health and wellness outlook 7
The largest segment of the Indian population can be classified as 'Easy Going' with regards to health 9
'Health Seekers' are the fastest growing segment of Indian consumers 11
Skeptics are aware of the benefits of consumption of health and wellness products 13
'Food Actives' are health aware, but do not readily embrace health fads 14
'Health Buffs' make up a very small portion of consumers in India: they have a holistic view of health and wellness, looking to maintain both a healthy diet and physical fitness 16
Key takeouts and implications: health driven marketing in India needs to appropriately adapted to the differing consumer segments that exist 18
TREND: Marketers are developing healthier product formulations to differentiate themselves and to address Indians' increasing lifestyle-related health concerns 18
Milk products increasingly target the health concerns of Indian consumers 19
Oils and fats are being re-formulated and re-positioned to address health concerns 21
Bread and breakfast cereal claims are moving beyond basic nutrition in a trend that mirrors Western markets 23
There has been an especially high amount of health-aligned NPD activity in the hot beverages market (excluding coffee) 25
Fruit-based beverages have renewed health-based credibility following the activity of prominent brands 26
Sports and energy drinks is a relatively new segment in India but shows good growth potential 28
The biscuit category is one of the largest in the packaged food industry in India and has seen strong growth over the last few years, both in urban and rural markets 30
Key takeouts and implications: health and wellness orientated innovation and consumption is increasingly evident across product categories 31
TREND: There has been an increased focus on development of organic food and beverages in India 32
Indian manufacturers are quickly responding to the rising domestic demand for organic foods 34
In the recent past, there have been significant efforts by governmental bodies in India to lend structure to and regulate organic food production and distribution 36
Key takeouts and implications: the organic food and beverage market in India will expand significantly in the coming years 37
INSIGHT: Indian women more actively buy and consume health-aligned food and beverages although there are attitudinal similarities among the genders 37
Key takeouts and implications: more Indians are coming to realize the value of good diet and nutrition as a form of preventive healthcare 40
INSIGHT: Younger generation Indians' primary health concern is their physical appearance although concerns evolve with age 40
Key takeouts and implications: Indians express interest in a myriad of health issues 43
INSIGHT: Ingredient-linked health claims exert differing degrees of influence on Indians' food and beverage choices 43
Key takeouts and implications: as health consciousness becomes more granular, the specifics of health claims will increasingly dictate Indians' product choices 46
INSIGHT: Indian consumers perceive freshness claims to be more influential than authentic/natural claims 47
Key takeouts and implications: 49
INSIGHT: Indian women more thoroughly understand and use nutritional information from reference groups as well as packaging to aid product choice 50
Key takeouts and implications: Indians are showing an even greater interest in reading or hearing information about the relationship between food and health 53
INSIGHT: Taste aspect of healthier variants of food and beverages is often a greater concern to Indian men 54
Key takeouts and implications: the most common challenge faced by companies is to ensure the taste of their products which have a health positioning. 55
ACTION POINTS 56
ACTION: Health food and drinks should be made available in convenient and innovative package formats to keep up with the changing consumption patterns 56
Portion controlled packages would help to drive product uptake among Indian consumers who are watchful of their calorie intake 56
Re-sealability and on-the-go consumption are among most desired packaging attributes 57
ACTION: While focusing on developing functional or fortified food and beverages, manufacturers should also explore opportunities in dietary supplements 59
ACTION: Product development should address the emerging health and wellness needs of a fast-growing, aging demographic in India 62
APPENDIX 65
Methodology 65
Further reading and references 66
Ask the analyst 67
Datamonitor consulting 67
Disclaimer 67
List of Tables
Table 1: Per capita expenditure on fresh and long-life packaged milk in India is currently $3.4 and has grown at a CAGR of 9% over the period 2003-2009 20
Table 2: Per capita expenditure on oils in India is currently $1.7 and has grown at a CAGR of 9% over the period 2003-2009 22
Table 3: Per capita expenditure on bread and breakfast cereals in India is currently just $0.5 and has grown at a CAGR of 11% over the period 2003-2009 24
Table 4: Per capita expenditure on juices in India is currently $0.4 and has grown at a CAGR of 17% over the period 2003-2009 27
Table 5: Per capita expenditure on biscuits in India is currently $1.3 and has grown at a CAGR of 8% over the period 2003-2009 30
Table 6: Organic food and non-alcoholic beverage spend in five Asia Pacific countries (US$m), by country and product format, 2004-2014 33
Table 7: Ingredient-linked health claims have a low and similar level of influence on Indian men's choice of food and beverages 45
Table 8: Ingredient-linked health claims have a high level of influence on Indian women's choice of food and beverages compared to men 46
Table 9: Key nutrient deficiencies among Indian children (2005-06) 61
List of Figures
Figure 1: Health and wellness food and beverages in India are broadly classified into 'good for you' and 'better for you' products 7
Figure 2: Differing segments of Indian consumers exist, each with a differing health and wellness outlook 8
Figure 3: Information areas to assess Indian consumers' attitude towards health and wellness, and their purchase and consumption behavior of food and drinks 9
Figure 4: More Indian men can be classified as Easy Going regarding their attitude towards health and wellness 10
Figure 5: Companies need to work on innovative product concept and engaging campaigns to build long-term consumer awareness and demand for health foods 11
Figure 6: Health Seekers in India are marginally skewed towards 25-49 year olds and males 12
Figure 7: Detailed nutritional information and ingredient-linked health benefits on product packaging helps build consumer awareness among Health Seekers in India, as seen with Sundrop Oil 12
Figure 8: There are more female health Skeptics, a segment also disproportionately skewed towards more mature consumers 13
Figure 9: Targeted communication on product packaging to differing consumer cohorts can help address specified product claim skepticism that is prevalent among some Indians 14
Figure 10: Indians between the ages of 35-49 constitute the highest percentage of Food Actives 15
Figure 11: Highlighting the presence of 'real', 'natural' and traditional ingredients is important for connecting with Indian consumers who are focused on the quality of their dietary intake 16
Figure 12: There are more females in India who fall under the 'Health buffs' consumer segment 17
Figure 13: Those Indians with a high level of health pre-occupation will be potentially more attracted to unique product formulations such as probiotic ice cream 17
Figure 14: Indians are confronted with an increasing number of lifestyle-related health concerns 19
Figure 15: Packaged milk market in India is a fast growing segment, with variants targeted across age groups and health concerns related to heart and bone & joint health 21
Figure 16: Owing to product formulation changes, cooking oil products in India now tout heart health benefits 23
Figure 17: Healthier variants of bread and breakfast cereals have begun to show increased adoption and potential for growth among Indian consumers 25
Figure 18: The hot beverages market in India is fast evolving to address age, gender and lifestyle-specific nutritional needs 26
Figure 19: The fruit-based beverage market in India has created a lot of category awareness regarding health benefits, and presents opportunities for innovation in flavors and packaging formats 28
Figure 20: The energy and sports drinks market in India is still in a nascent stage and offers opportunities for more brands and variants, at affordable price points 29
Figure 21: Biscuits are emerging as the most affordable source of nutrition in India, with many products being launched with a cereal-based formulation and addressing digestive concerns 31
Figure 22: The comparatively small organic markets in China, South Korea and India are expected to grow rapidly over the next five years 34
Figure 23: Organic variants are increasingly available across several categories in the Indian packaged food market 35
Figure 24: Manufacturers are including details of organic certification on product labeling to increase consumer awareness and understanding 35
Figure 25: The Indian organic food and beverage market became more regulated with the introduction of the mandatory logo of certification by the NSOP 36
Figure 26: Across age groups, Indian men and women show similar levels of interests in food and beverages which help improve general health and wellbeing 38
Figure 27: Compared to men, Indian women are more interested and actively buy functional food and beverages with added health benefits 38
Figure 28: Indian women across all age groups make a more conscious attempt to eat healthily compared to the men 39
Figure 29: Desire to eat healthily among Indian consumers shows a multi-stage adoption pattern 40
Figure 30: Younger Indian men look for appearance-linked health benefits from food and beverages, but with age, benefits related to 'physical energy and stamina' gain more importance 42
Figure 31: Younger Indian women look for appearance-linked health benefits from food and beverages, but with age, benefits related to 'heart health' gain more importance 42
Figure 32: Level of influence of several ingredient-linked product claims over Indian consumers when making food and beverage choices 44
Figure 33: Indian consumers across all age groups are more influenced by freshness claims rather than natural/organic or authentic/home-made/original claims 48
Figure 34: An increasing number of Indian men and women are making a conscious effort to buy organic food and drinks regularly 49
Figure 35: Both Indian men and women show a keen interest in reading or hearing about the relationship between food and health 51
Figure 36: Indian consumers remain unsure about whether they feel food and health information is confusing and conflicting 52
Figure 37: More Indian women than men use nutritional information on product packaging to help make food and drink choices 53
Figure 38: Across all age groups, more Indian men than women believe that healthy food is not tasty and enjoyable 55
Figure 39: The design, size and labeling of health food and beverage packages need to be planned with portion control in mind, and packs should promote nutritional benefits that are easy to understand 57
Figure 40: Create innovative packaging that allows for apportioned intake and re-use, to increase the ease of consumption of on-the-go health and wellness food and beverages 58
Figure 41: Marketing to educate consumers on the benefits of a healthy diet is being explored by firms such as Quaker Oats to drive long-term demand in India 59
Figure 42: Focus on creating product packaging and formulation which makes it interesting for kids to voluntarily include healthy food and beverages as part of their dietary intake 62
Figure 43: Address the latent need for formulating food and beverages keeping in mind the health concerns and the attributes of the fast-growing, aging demographic in India 64

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