Consumer Needs At The Core Of Expansion Strategy
We at Piramal are very excited for the future about the products that we have lined up for our consumers and we will continue to focus on improving the quality of life through our product offerings
India is slated to become one of the largest growth engines in the world with a rising middle class that is expected to reach 89 million by 2025. Urbanisation has increased consumption all over India, The Indian OTC (over the counter) market is expected to grow at a compounded annual growth rate (CAGR) of 9 per cent and cross Rs 44,000 crore by 2026. Shift in the consumer attitude towards self-care, rise in geriatric population, rapid shift from prescription to OTC, liberalisation of OTC drugs sales and their affordability are some of the key growth drivers.
For pharmaceutical companies looking at new ways of growing, the OTC segment offers a very lucrative business proposition as it does not bank on doctors’ prescription to drive sales. This growth is also reflected in consumers; with the advent of lifestyle diseases, we are seeing a trend where younger people are taking active preventive steps to live a healthy lifestyle. It is an exciting time to partner with consumers and empower them to make an educated choice about their health.
The extension of Piramal’s pharmaceutical division into the OTC space was an organic move that began in the 1990s with the acquisition of Abbott and Boots Plc. We formally entered the OTC segment in 2008, with the acquisition of three brands — Saridon, Lacto Calamine and Polycrol. Since then, the consumer products division at Piramal has steadily grown with the strategic acquisition of heritage brands such as Waterbury’s Compound, Sloan’s, i-Pill, Caladryl, Naturolax, Neko and Little’s. The exciting part about these acquisitions has been that we have been able to build on these brands by adding our own innovations and drive their growth. For instance, with Polycrol, we received feedback that the current flavour left a chalky aftertaste, that is when we launched Polycrol in Paan flavour, which was very well received by the consumers. This is precisely how our OTC model functions; we acquire and develop products to meet consumer needs based on deep consumer insights and an analysis of how the category is growing. Over the past eight years, our business has grown rapidly at a CAGR of 22 per cent, and we are currently ranked fifth in the OTC segment. Our products have also been well accepted by the consumers and six of our brands are amongst the top 100 OTC brands in India. We have made significant investments to grow our OTC business, ensuring that our products are available to consumers in small towns as well. This has been in line with establishing a large distribution network spanning across 4.2 lakh outlets across India, a feat comparable with the top three OTC players in India.
I think it is important for companies to place consumer needs at the core of their expansion strategy. We are now looking at expanding into various other categories, and are aiming to become the top three players in the OTC segment. Our business strategy has been to balance our organic and inorganic growth with disruptive innovations that can address consumers’ unmet needs.
We at Piramal are very excited for the future about the products that we have lined up for our consumers and we will continue to focus on improving the quality of life through our product offerings.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.