Major packaged foods marketers are beginning to noticeably push into the health foods segment with new packaged offerings. While this segment is still small and more in the investment phase of the development cycle, the fact that large established players are pushing it and international players are beginning to make an entry into it, points towards much bigger prospects in the future.
While sugar-free chocolates have been available for some time now, the dairy segment is seeing a spurt in 'probiotic' products. Nestle launched probiotic
first. Then Amul launched sugar-free and probiotic ice-creams for diabetics and the sugar-consumption conscious.
Amul is also selling probiotic
in Gujarat. It is about to launch Calci-plus milk, with twice the calcium content of normal milk, aimed at osteoporosis patients and pregnant women.
ITC Foods is on the verge of launching more health foods under its Sunfeast banner. Sunfeast forayed into the health foods segment with Sunfeast Sachin Fit Kit range and the Sunfeast BenneVita Pasta. It has just launched Sunfeast BenneVita Flaxseed biscuits.
Marico is betting big on its functional foods business, under which it has launched its cholesterol-management
mix and is test marketing diabetes management
mix in Delhi.
Dabur, with its sugar-free Chyawanprash variant, Chyawanprakash, is also firmly placing its foot in the space. Talking about Chyawanprakash, targeted at the diabetic and calorie-conscious consumers, Sanjay Sharma, business head (foods), Dabur India Ltd, says the initial responses are good. Dabur has also introduced ChyawanShakti, another variant aimed at combating stress. In juices, its Activ range is addressing health needs. It is also attempting to convert sugar users to Dabur Honey through its brand ambassador Amitabh Bachchan, in a 360-degree campaign across all media.
The latest to join the fray is Yakult, which struck a 50:50 joint venture with France's Group Danone in 2005 and launched its probiotic milk in Delhi on December 19, 2007. It has already invested Rs 136 crore in setting up a dairy products' manufacturing facility in Sonepat, Haryana.
Like in any other product segment at the beginning of its development cycle, packaged health foods have both, their skeptics as well as enthusiasts. The skeptics argue that while the initiatives by themselves may be impressive, the size of the business is not large enough to be attractive to many players. Mayan Shah, senior product manager, Parle Products, reasons, "The total biscuits market is a good Rs 7,000-8,000 crore. But health food products, in totality, may not even exceed Rs 20 crore." He says that is why Parle has introduced just its Digestive Marie range. "The volumes just aren't big enough."
GCMMF's (Amul) chief general manager marketing, RS Sodhi says, "We expect health oriented and probiotic products to together contribute to 10 per cent of our total turnover." He says that of the total organised ice-cream market of Rs 800 crore, Amul has a share of Rs 350 crore and expects probiotic ice-cream to contribute 10 per cent (Rs 35 crore) to the sales turnover. He agrees that this market is still small: "The main concern is education and awareness. But with players like Nestle and Yakult making their entry, the market will certainly grow." Prices of Amul's health products are 10 per cent higher than the normal products.
Dabur's Sharma is highly optimistic: "The entire sugar-free products market – including carbonated drinks – is expected to be in the range of Rs 300-400 crore, and growing at around 25 per cent. The market for low calorie products or products for the health-conscious is also growing. Though still largely urban, the consumer base for such products is rising with younger consumers becoming more health conscious.
The fruit-based beverage (with no added sugar) market alone stands at over Rs 60 crore, showing an average 40 per cent growth year-on-year."
Harish Bijoor, CEO, Harish Bijoor Consults, says there is scope for packaged health foods in India. "India is the diabetes capital of the world and has high incidence of heart- and cholesterol-related diseases."
He adds that though the numbers are small as of now, the entry of the likes of Yakult, Glaceau and such other players, besides the big marketers, is bound to make a difference.