Movement towards herbal and Ayurvedic products is strengthening over the last quarter with most of the companies riding on the near Rs 5000 crore worth Patanjali Ayurved. With the latter on its way to achieve its target of Rs 10,000 crore turnover by next year, global multinationals are looking to follow its success formula. According to media reports, the Ayurvedic products market is said to be growing nearly five per cent higher than the sectoral growth rate.
So the growing importance of Ayurved in the consumer goods space cannot be overlooked with host of companies working on the ‘natural’ category. For instance, L’Oreal India has reintroduced its popular Ultra Doux brand from the 1990s as Garnier Ultra Blends as part of its worldwide relaunch. It has been launched as a global initiative with a target to add more than one billion new consumers globally over the next decade.
The Garnier Ultra Blends will be spread across shampoo, conditioners and oil and cream segment in India which comes with henna and almond. According to media reports Jean-Christophe Letellier, managing director, L’Oreal India has mentioned that the formula for the India range was developed at the company’s local R&D centre over the past 18 months. For L’Oreal SA, India currently accounts for less than 1% of its annual sales but wants to more than double its business to a billion euros by 2020 according to media reports.
Putting up a strong fight against Patanjali
Suddenly companies that sell personal care products made of Ayurvedic, herbal or natural ingredients, are in expansion mode and seeking a bigger share of a market. Dabur had partnered with the Central Council of Research in Ayurvedic Sciences (CCRAS), under the Union ministry of AYUSH. In 2015-16, it signed a licensing agreement with CCRAS to commercially produce two ayurvedic drugs. Last year it launched 44 products in the category.
Emami, which is already a strong player in the natural/ayurvedic space through its Zandu brand, is strategising to launch natural healthcare products for lifestyle diseases. According to media reports the company has seen a 30-35% growth. Bangalore-based Himalaya Herbals is planning to expand into the men’s grooming segment, as a means to counter against Patanjali. Bio Veda Action Research Co. will spend Rs.250 crore this financial year on advertising and marketing its ayurvedic personal care products brand Biotique. Another Rs.200 crore will be invested in doubling capacity by adding new factories and to open about 100 standalone Biotique stores in the next 1-2 years.
HUL after its acquisition of hair care brand Indulekha from Kerala-based Mosons Group for ?330 crore, is looking to scale up its e-commerce space, particularly in the natural and ayurveda space, with the focus on digitisation and sustainability. Last year it relaunched Lever Ayush for its ayurvedic range, to be sold exclusively online.
Colgate-Palmolive (India) is putting up a strong fight against Baba Ramdev’s Patanjali Ayurved through its innovation in herbal segment with its launch of sensitive toothpastes containing clove oil (Colgate Sensitive Clove Essence) and based on charcoal (Colgate Charcoal Deep Clean) in 2015 and express pain relief gel this February.
Besides all the action in the Ayurved space, FMCG major Nestle India is all set for aggressive product launches numbered up to 25 across various categories like dairy, confectionary, beverages, tea and coffee over the next few months. The company with a turnover Rs 8,175 crore in 2015 has already introduced seven variants of Maggi noodles, Greek yogurt brand Grekyo, and protein supplement Pro-Gro in the last few months. Seven months after its half-a-billion dollar Maggi debacle, Nestle India is targeting a higher market share with its new strategy.
There’s no doubt that the advent of Patanjali Ayurved has led the other players to strengthen its hold on Ayurved FMCG category since this is where the buck is. According to media reports personal care products was almost on par with that of the larger personal care products segment, but in the last one year, herbal has outpaced the rest of the industry.
Apart from this the global trend of use of herbal products is also another trigger, with the market for herbal supplements and remedies is expected to be worth $107 billion by 2017 and then touch $115 billion in 2020 according to a February 2015 forecast by Global Industry Analysts, a San Jose, US based market research firm.
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