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Wellness Industry 13 Feb 2015

Beverages with benefits abound in wellness

The demand for health beverages including energy drinks and protein supplements is growing in the wellness industry at a CAGR of 25 per cent, indicating a huge market potential for this category.

A healthy diet and routine is gaining a common preference these days among people who are becoming equally conscious about the food as well as the beverages they consume. Consequently, health beverages have established a viable position in the wellness market as evidenced by their commonplace consumption, not only by the general consumer, but also by fitness enthusiasts between 18 to 35 years’ age group.

Long and erratic working hours and increasing occurrence of social gatherings are some other factors encouraging demand and consumption of energy drinks like Red Bull, protein shakes and other non-alcoholic, caffeinated beverages like Coke Zero. A sharp rise was also seen due to the changing lifestyle and increasing demand for it as alcohol mixers.

Commenting on the same, Nitin Gupta, Founder and CEO, KG Functional Beverages Pvt Ltd, said, “Restless, the only Indian drink with Ginseng, Taurine, Vitamin C and essential salts, in it’s current hi-caffeine avatar, was launched last February and already garnered around 5 per cent market share, and we are gunning for a 20 per cent share of the pie by the end of 2015.”

Present market size
In India, the energy drinks market is still small - barely Rs 700 crore or 5 per cent of the total soft drink market, primarily dominated by Colas and other aerated drinks. However, with the recent wellness influx, it is expected to grow at a CAGR of 25 per cent. Indian FMCG majors like Tata Global Beverages (TGB), KG Functional Beverages Pvt Ltd and Hector Beverages have entered the segment to tap the biggest market share.

A TGB Spokesperson said, “TGB is well positioned to leverage this trend as it focuses on natural beverages - tea, coffee and water. Through NourishCo, a Joint Venture between Tata Global Beverages and PepsiCo, we are focusing on enhancing the hydration category in India. The portfolio includes Himalayan, a natural mineral water brand, Tata Gluco Plus, a glucose-based drink in an affordable cup format and Tata Water Plus, an innovative product that seeks to provide essential micronutrients.”

Consumption pattern
With the rising demand for energy drinks, there is an ever-increasing demand for health supplements like Whey proteins, Soya proteins et al in the modern world. These health drinks provide nutrition and energy not only to the adolescents, but to the adult lot as well. Attributed to heightening mental vigour and providing a swift energy boost, these beverages are aplenty in university campuses, clubs and fitness centres. 

As per the recent findings of N L Dalmia Institute of Management Studies and Research, the consumption of energy drinks in India is projected at 20-22 million cans. About 65 per cent of the drinkers are between 13 and 35 year-old age group, with males being approx 65 per cent of the overall market.

Elaborating on the same, Gaurav Adlakha, Founder, Being Fit Gym, said, “Whey proteins fulfill the need of protein, which is a macronutrient required to build body muscle, often lagging in Indian diets, and sports drinks provide dose of carbohydrate to sustain an endurance activity. However, energy drinks like Red Bull or Tzinga contains caffeine, and its high dose may lead to insomnia or gastrointestinal problems. Cola contains a high level of sugar, which is a primary cause of weight gain, while the calorie-free aspect of diet soda may sound enticing, but it contains artificial sweetener that makes you feel hungry and leads to eating more.”

Scope of e-tailing
With the expansion and growing rage of eCommerce in India, the availability of health beverages on online retailing sites will be more. Online retailers like Healthkart, Nature’s Basket, Grabmore and others have tied up with national and international brands to deliver desired products at the consumers’ doorstep.

Sameer Maheshwari, Managing Director & Co-founder, HealthKart.com, shared, “Shipping of liquid drinks is the biggest restriction or challenge, in comparison with the powdered drinks like Whey proteins, Soya proteins and other health supplements. Still, it is difficult for the consumers to authenticate the source of these products. We proposed the idea of introducing Red Bull on our portal, which was highly appreciated by the consumers and we received fantastic demand for the same and soon we would introduce some interesting products on Healthkart.”

Future forecast
The health beverages and energy drinks segment is more of an urban phenomena, limited to the big metros and Tier II cities. Bagging a place for their product on retail shelves or via popular brands could be challenging for the new entrants. Nevertheless, there is enough scope for new entrants as the market has a huge potential.

“As income levels and penetration grows in the coming years, this segment is likely to see rapid growth,” commented Vishal Jain, CEO, JusDivine.

Overall, health beverages and energy drinks is an exciting segment that will continue to grow on the strength of innovations.

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