Inputs provided by Mr. Sushil Khaitan, Director & CEO- Purenutrition.me
Despite global concerns about slow productivity growth and a rapidly aging society, Asian economies continue to expand, with the IMF estimating growth in the region to increase from 5.3% to 5.5% this year. China and India, two of the region’s economic powerhouses play an important role in this growth and Asia’s nutraceutical market will be one of the key beneficiaries and contributors to economic growth across the continent. Asia has long been viewed as potentially one of the most profitable markets for nutraceuticals, therefore attracting a number of manufacturers and creating a high level of competition. To establish themselves firmly, nutraceutical manufacturers have been working to advance their technology, as well as the quality of their products. This has been a major driver for innovation in the sector, but it is not the only factor influencing growth.
For emerging companies to succeed in this market, they need to have a sophisticated understanding of the various trends, cultural preferences, and regulatory frameworks in the region.
How Asian Nutraceutical Market Trends Stack Up
When you look at the Asia Pacific or APAC market in the global context, you get a clearer picture of the immense opportunity for nutraceutical manufacturers. Sushil Khaitan, Director & CEO of Pure Nutrition, points out, “While the global market is estimated to reach a value of USD 302,306 million within 5 years, based on a CAGR of 7.04%, Asian nutraceutical markets are poised to surpass global growth, with an anticipated CAGR of 7.33%. At present, dietary supplements including herbal, vitamin, and mineral supplements dominate the nutraceuticals product market, but the functional food segment is also experiencing rapid growth because of rising demand for healthy beverages and fortified foods.”
- Developing countries in the Asia-Pacific region are now savvy to the latest global food and nutrition trends; a fact that has helped generate interest in nutraceutical products. Growing awareness about lifestyle diseases and the importance of nutrition in disease prevention is fueling a demand for both supplements and functional foods. As Asians become increasingly health conscious, they play a more proactive role in preserving and protecting their health, which is an impetus for the nutraceutical industry. The Asia Pacific region is therefore quickly emerging as a major contributor to the global nutraceutical market.
- Asian culture has a long tradition of natural medicine, including the ancient Indian discipline of Ayurveda and Traditional Chinese Medicine. The use of herbs, herbal extracts, and medicinal foods therefore is part of the region’s rich history and it is also shaping current demands. Healthy foods like oats and yogurt are already extremely popular, and there is great demand for similar functional foods, with omega fatty acid fortified foods and probiotics being among the most popular. The broader category of dietary supplements is also expanding and Asian players here have an edge because of the ease of sourcing raw materials within the region itself.
- Asia is also home to some well-established markets that still show tremendous potential for growth. “This obviously includes the nutraceutical markets of China, with a CAGR of 7.15%, and Japan with a CAGR of 7.76%. India’s nutraceutical market is also expanding rapidly because of greater consumer awareness, a growing aged population, and spiraling health care costs”, says Sushil Khaitan. Moreover, India has a large untapped market in its smaller cities and towns, where market penetration is ongoing, thanks to rapid digitization.
- The increasing sophistication of Asian consumers has also led to a rise in expectations, with consumers showing greater awareness about food and nutraceutical options. Most look specifically for products that meet their unique needs, opting for those that contain natural ingredients that they are familiar with. These discerning consumers also have higher expectations with regard to product quality and this is leading is in the direction of more stringent and clearly defined regulations. While at first glance this may appear as a challenge for the industry, it is actually a boon, as it raises overall standards and increases customer confidence, ultimately benefitting sales.
- While regulatory frameworks develop and evolve in individual Asian markets, there is also a need for better integration of the Asian markets as a whole. According to Mr. Khaitan, “Efforts to establish unified standards across the ASEAN region are favorable and most industry insiders see this as a positive development. Regulations governing health claims, however, remain a significant concern at present, as manufacturers need to be able to clearly inform consumers about the benefits of their products.”
- While growing consumer awareness about the role of nutrition in health and wellness has been a major contributor to the nutraceutical market’s growth in Asia, changing perceptions of nutraceuticals within the medical community have also had a sizeable impact. There is a clear trend towards including functional foods and supplements in prescriptions, as research throws light on the role of diet and nutrition in both disease prevention and treatment. The scope of nutraceuticals within health care has also widened, as it isn’t just meal replacements and liquid foods that doctors are prescribing to patients. Nutritionists, dietitians, and other holistic health practitioners have also helped popularize nutraceutical products like herbal and dietary supplements.
- Sports nutrition has always been viewed favorably, as performance and health based, but its appeal or focus was rather narrow in the past. Today, sports nutrition is not just the exclusive domain of sportsmen and athletes, but is a part of the mainstream because of a growing fitness culture. Elements of sports nutrition like protein supplementation are now also seen as helpful to weight management, with more consumers using them in combination with healthier diets and active lifestyles.
- The past decade has also witnessed a rapid cultural shift, with more fitness instructors and trainers joining the ranks of celebrities in popularity. A significant shift has also been observed in gender and body perception, with growing body-positivity movements that encourage the ‘strong not skinny’ trend. This is opening a whole new market for the nutraceutical industry, as more women are now drawn towards protein and mineral supplements that are vital for muscle growth and fitness.
- Nutraceutical manufacturers are investing heavily in research and development, as the market is highly competitive and innovation is absolutely essential. As pointed out by Mr. Khaithan, “Pure Nutrition is already planning several new product launches like bio chlorophyll (concentrated wheat grass), which can help fight inflammatory conditions, and collagen sachets, which help not just with skin health, but also the joints. We are also investing resources in cancer research, in an endeavor to create products that address both physiological and cosmetic concerns that are common to cancer patients.”
With so many factors at play, the Asian nutraceutical markets may seem daunting to new entrants in the space. But, with a clear understanding of regional history, cultural influences, food patterns, economic policies, and other trends that influence demand, manufacturers and retailers can still claim a sizeable share of this emerging market.