Battle of Health-Drinks in IndiaTAPISH PANWAR

The ‘Health-conscious’ Indian

Reasons behind a growing inclination of Indian consumers towards healthier food and beverages -

High level of consumerism backed by rising income levels (~$400 in 2001 to ~$1100 currently) (Health accounted for ~10% of household expense & is risiing)

Exposure to wide product offerings in developed markets

Higher rate of urbanization (27% in 2001 to 31% in 2011)

Rising health issues owing to changing lifestyles

Aggressive marketing by health food and beverages brands

Rising concerns among consumers about efficacy of traditional foods

Two faced nutritional problems – one due to excess and other from deficiency

Indian Health Food Industry

Functional foods(combinations of all types of health foods) seen as an effective measure to arrest the growing nutritional deficiency problems

The concept of functional foods was coined by Japanese scientists relating four essential pillars – nutrition, sensory satisfaction, fortification and modulation of physiological systems

India’s definition of functional foods based on FSSA is a broad spectrum that clubs the foods for special dietary uses, the functional foods, the nutraceuticals and the health supplements together

Health and Wellness Foods market estimated at 10000 crores in 2012 and expected to grow to 55000 crores by 2015 at a CAGR of 33%

FSSA – Food Safety and Standards Act, 2006

(India)

As per FSSA,

Functional foods

Includes powders,granules, tablets, capsules

Indian Health-drinks Industry

Divided into two categories – White powders (Horlicks, Complan etc) and Brown powders (Bournvita, Boost etc)

Health drink powders consumed as milk substitute & nutrient boosters

India’s Health-drinks market pegged at around 4000 crores (90000 tonnes) and expected to reach approximately 8000 crores by 2016

India is world’s largest malt-based drinks market with a share of almost 22% in the world’s total retail volume(Malt is germinated cereal grains that have been dried in a process known as malting)

White Powders ~65%

Brown Powders ~35%

Major Players and Brands

GlaxoSmithKline Horlicks

Boost

Maltova

Viva

Kraft-Cadbury (Mondelez International) Bournivita

Heinz Complan

Amul Nutramul

Pro

Market-share of Major Brands

Horlicks – 51 %

Bournvita – 16.2%

Complan – 13.9%

Boost – 12 %

Brand Trust Ratings by Trust Research Advisory

Target Group and Positioning

Horlicks - ‘The great family nourisher’ that offers pleasurable

nourishment with a delicious range of flavors

All HFD TG : Middle income group and above, Metro/Urban/Semi-urban

Junior Horlicks 1-2-3 Target Group : Toddlers (Consumption) Mothers (Communication)

Positioning : An easy-to-digest drink for fussy toddlers providing them with essential nutrition value

Junior Horlicks 4-5-6 with growth boosters Target Group : Preschoolers (Consumption) Mothers(Communication)

Positioning – A nutrition packed health food for active preschoolers with who have a busy schedule and need to remain charged

Target Group and Positioning

Mother’s Horlicks Tagline : Healthy mothers for healthy and smart babies!

Target Group : Pregnant and Breast-feeding women

Positioning : A superior nutritional supplement for pregnant and breast-feeding women to meet their daily nutritional requirements

USP : DHA as ingredient and ability to provide 100% RDA (Recommended Dietary Allowance) for the TG

Horlicks Lite Target Group : Adults

Positioning – Especially designed to provide nutrition to adults and provide them with strength and stamina to keep going

USP : Only HFD to be endorsed and certified by Diabetes India

Target Group and Positioning

Horlicks Tagline : Proven for making kids taller, stronger and sharper

Target Group : Kids aged 5-15 years and Mothers (Communication)

Positioning : A nutritional supplement that positively enhances physical and mental growth of kids

USP : Huge emphasis on the “proven” efficacy for child’s mental & physical growth on the basis of results from a series of researches

Viva Tagline : Start to a bright and healthy day!

Target group : For age group 15 years and above

Positioning : Provides healthy foundation to life and a good start to the day

Target Group and Positioning

Boost Tagline : Boost is the secret of winning energy

Target Group : Children and adults looking for an energy drink

Positioning : Always positioned as an energy drink hence the tagline. It is promoted as being the only HFD proven to increase stamina by three times

USP : Strong Sportsmen endorsements(Kapil Dev, Sachin Tendulkar, Virender Sehwag, MS Dhoni) leading to brand following by kids

Maltova Tagline : The yummy choco-malt drink

Target Group : Kids aged 5-15 years(Consumption) Mothers(Communication)

Positioning : Fun health drink with pleasing taste

Target Group and Positioning

Bournvita Tagline : Tayyari jeet ki (preparing to win)

Target Group : Children aged 5-15 years & Mothers ( For Communication)

Positioning : Help kids to grow faster and enhances goodness of milk(Calcium)

USP : Strong advertising and taste appeals most in the category to the TG

Bournvita Li’l champs Target Group : Children aged 2-5 years & Mothers(For Communication)

Positioning : Most effective for kids due to DHA and whey protein content

USP : Packaging to attract kids and attached offers/gifts for kids

Target Group and Positioning

Complan (COMplete PLANned) Tagline : Extra growing power with Complan

Target Group : Children aged 5-15 years & Mothers ( For Communication)

Positioning : Help kids to grow taller at twice the rate

USP : Backs its ‘tall’ claims by multiple researches

Complan with Memory Chargers Target Group : Children aged 5-15 years & Mothers ( For Communication)

Positioning : Improves memory and cognitive abilities in kids

USP : First HFD to target memory and cognitive benefits. Backs claims by results of an independent research

Claims (Product and Benefits)

Horlicks : 27 vital nutrients – Proteins, Multi-vitamins and DHA

‘Nutrisorb’ technology – Makes nutrients easily absorbable(& more effective)

Junior Horlicks (1-2-3 and 4-5-6) : Pre-digested (Easy for digestion for Toddlers)

23 vital nutrients (Body and Brain development)

Growth Boosters – Protein, Calcium, Vitamin D &K and Magneisum (promotes physical health in children)

Power Vitamins – Vitamin B1, B2 , B6 and Niacin (Vitamin B3) (Energy releasers to keep the kids charged up)

Smart Nutrients – Iron, Iodine, DHA, Choline, Vitamin C and Folic Acid (Essential for brain development and functioning)

Mother’s Horlicks : 26 vital nutrients – Essential for pregnant and breast-feeding women

Fortified DHA - Essential for brain development of child during pregnancy and early years of life (DHA is otherwise available to child only through mother’s milk)

100% RDA (Recommended Dietary Allowance – Iron, Folate, Calcium, Vitamins C, B2, B6 and B12 (Essential for blood and bone health)

Anti-oxidants – Vitamin A, E , Selenium , Zinc and Copper (Essential during pregnancy and lactation)

Natural malting process – Breaking molecules into simpler forms (Easy to digest)

Horlicks Lite : Zero added sugar and zero added cholesterol with high fibre content

23 vital nutrients (Protein and antioxidants) to repair damaged body cells)

Claims (Product and Benefits)

Claims (Product and Benefits)

Boost : EnVita Nutrients – Systematic combination of vitamins and minerals

important for energy metabolism and hence increasing stamina

Maltova :

Active Rechargers – Combination of Vitamnis, Mineral and Carbohydrates to provide essential nutrition and energy to growing

Viva :

VitaHealth – 9 essential vitamins to keep one charged up for the whole day

Natural goodness of milk and malted barley

Claims (Product and Benefits)

Bournvita : Enriched with vitamins that help in children’s physical and mental

growth

High on vitamin D which enriches goodness of milk (calcium and other nutrients)

High on whey protein content

Bournvita Ll’l champs : Enriched with 13 vitamins an 5 minerals responsible for growth of

kids in the age group of 2-5 years

DHA and whey protein content – work wonders with milk for growth in kids

Essential macronutrients like carbohydrates, essential fats and protein

Claims (Product and Benefits)

Complan : 34 vital nutrients (including iron, iodine and essential fatty acids)

Includes 100% milk protein for better growth of kids

Almost 52% milk solids making it extremely helpful for growing kids

Complan with Memory Chargers: Enriched with 8 memory chargers in 34 vital nutrients that works wonder

on brain development for growing kids

Nutrients includes Iodine, Iron, Folic acid, Choline, Vitamin B6 & B12, Vitamin C and Almond that are known to enhance cognitive abilities

Choco-badam chips in double chocolate drink

Major Research Claims by Brands

Complan “…Benefits proven through an independent study conducted in 2008 for 12

months on the children with age-group 7-12 years in Coimbatore…”

Bournivta “…Research shows that lack of Vitamin D makes the nutrients of milk weak

and hence Bournvita with its essential nutrition enhances goodness of milk (Calcium)….”

Horlicks “..boiling of milk robs it of almost 25% of its nutrient value..”

“…benefits proven with the help of a study conducted by NIN, Hyderabad on micronutrient enriched beverages on 869 school children…”

Nutritional Value Claims vs Reality*

Complan Calcium, Niacin and Protein value below the declared value

Calcium and Fat content found to be below the declared value

Bournivita Niacin content below declared value

Niacin content below declared value

Boost Iron content found to be least among the competing brands

Niacin value found lower than declared

* Results based on consumer voice report July 2013 released by Department of Consumer Affairs, GoI

Nutritional Value Claims vs Reality*

Horlicks Niacin value found to be maximum among the competing brands

Calcium and Fat content found to be below the declared value

Amul Pro (Brand not included in the analysis due to low market share) Energy, Fats, Protein and Niacin values find below the declared value

ActiLife (Brand not included in the analysis due to low market share) Highest calcium and iron among competing brands

Protein value found to be lower than declared value

* Results based on consumer voice report July 2013 released by Department of Consumer Affairs, GoI

TVC Watch- Horlicks

Link - Horlicks – Taste Context – Reluctance of children in drinking plain milk

Emotion and effect Invoked – Dislike for plain milk leading to abandoning a rich source of nutrition

Proposition – Improve the taste of plain milk by adding horlicks which not only adds taste to milk but also enhances its efficacy

Link – Horlicks Women Context – Empowering women

Emotion and effect Invoked – Transformation of women into a strong, fearless, self-confident and independent being

Proposition – Horlicks celebrates the empowerment of women suggesting its role in the process without playing ‘hard-sell’

TVC Watch- Complan

Link - Complan- Double Milk Protein Context – Significance of protein in a child’s growth

Emotion and effect Invoked – Clinical setting to lend credibility to claim. Reinforce belief in protein as a major nutrient for growth among children

Proposition – Nourishes children with double milk protein thereby making them taller and healthier

Link – Complan - Grow taller twice the rate Context – Slow rate of growth in height

Emotion and effect Invoked – Frustration among kids due to shorter height leading to lack of confidence

Proposition – Complan suggests that a supplementary diet such as complan can help increase the height of kids at twice the rate

TVC Watch- Complan

Link - Complan - with Memory Chargers Context – Incomplete nutrition robbing memory

Emotion and effect Invoked – How lack in essential nutrition can affect the cognitive capabilities of children

Proposition – Complan with memory charges fulfil the need of these essential nutrients leading to improved learning abilities

TVC Watch- Bournvita

Link - Bournvita - Prepare to win Context – Importance of healthy habits

Emotion and effect Invoked – A mother’s concern to prepare her son to win in life and how wise and healthy habits plays an important role in achieving that

Proposition - Bournvita is one such healthy habit which must be cultivated to prepare your child to win in the game of life

Link – Bournvita Li'l champs Context – Want to see a champion in your child?

Emotion and effect Invoked – How it is important for kids to stay a step ahead in this competitive world and how should a mother take care of her her child’s nutritional needs to accomplish that?

Proposition – Bournvita Li’l champs nourishes kids with DHA(Smart) and whey protein (Strong) hence keeping them a step ahead

TVC Watch- Boost

Link - Boost - Secret of winning energy Context – Learning for life from sports (The playground is my

classroom)

Emotion and effect Invoked – How sports teach us various lesson for real life like self-confidence, ambitions, sharing etc. In order to keep learning one has to keep playing and hence need to stay fit , strong and energetic

Proposition - Boost provides you with that energy and strength to keep playing so that you keep learning

Prospects of Indian HFD market

Indian HFD market is a growth market with tremendous opportunities (Check graph)

India has one of the youngest population in the world making it a long-term HFD market (TG)

Still considered as one of the growth markets in terms of rising income reinforcing the long-term prospects

Rising awareness among consumers due to exposure to developed markets (More people than ever travelling abroad, foreign TV channels, global offerings) adds to TG everyday

Due to foreign origin of most of the HFD products(mostly developed markets) which have stricter laws related to food safety, the products don’t need much tweaking(& expenses) in that aspect

Market Size in crores

0

1000

2000

3000

4000

5000

6000

7000

8000

2006 2013 2016*

Consumer Behaviour(HFD purchase)

Consumers attitudes regarding HFD purchase is largely influenced by quality attributes of the product

No direct relation between brands and their sensory perceptions

Price, quality attributes and sensory perceptions are three major factors that makes a brand in the eyes of consumer better than other

Value for money(Nourishment vs price), price and packaging are ranked in the same order for influencing purchase decision

Brand loyalty stands out as a very significant factor in HFD purchase Mostly consumers will wait for their brand in case its not available at

the time of purchase instead of buying another brand

Need Recognition

Information Search (low)

Evaluation of Alternatives

Purchase

Post-purchase

Evaluation

Cognitive Dissonanc

e

Brand Loyalty

Age segments

Biggest TG is the age group of 5-15 years in terms of products offered to each TG

Other segments have exactly same number of products offered for them (Of the brands considered in this analysis)

Horlicks is present in four out of five segments while Bournivita covers three segments by its offerings

Complan, Boost and Maltova covers one segment each

15%

15%

38%

15%

15%

Share of products offered in each age group

1-3 years

4-6 years

5-15 years

Above 15 years

Above 25 years

Brand Benefits Segments

HFD as Energy drinks and source of essential nutrients (specific to TG, eg. Toddlers, Mothers etc) is most common positioning adopted by brands(25%)

Equal number of products offer benefits related to physical and mental growth (19% each)

Recently Horlciks and Bournivita in particular have also adopted a new proposition where they promise to enrich and strengthen the nutrient value of milk. With only 12% of considered brands adopting this positioning it holds the last position

25%

19%19%

25%

13%

Share of products offering based on benefits promised

Essential Nutrients

Physical Growth

Mental Growth

Energy

Enrich milk

Key Success Factors in HFD Market Strong market and consumer behaviour understanding to gauge

consumer expectations and market offerings ( Gap Analysis)

Unique, clear and relevant brand proposition to the consumers

Sensory appeal is very significant since end-consumers are kids who are fussy about taste and flavours

Clear distinction between communication for kids and mothers since both are significant players in purchase decision and require different satisfaction points to finalize on a product and purchase

Competitive pricing since price and value for money are important attributes in purchase decision for HFDs and it is very important to remain affordable yet attractive to consumers

Backed by strong distributions system and feedback mechanism to ensure availability and a connect between brand and consumers

References

Consumer Voice Report July 2013 , Department of Consumer Affairs

Functional Foods: Marketing ‘Health’ To Modern India(Manish Sharma and Shweta Garg)

Customers' Behavior in Health Food Drink Product Category (Dharmesh Motwani and Khushbu Agarwal)

News Releases from Leading Newspapers and Magazines Times of India

Economic Times

Business Line

The Hindu

Thank you