Exploring The Consumer Healthcare Space
Companies need to have a consumer-centric mindset and offer products that make their lives better and easy, allowing them to follow their daily routine without any worry
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Consumer behaviour in India is changing and so are the needs of consumers. The rise in disposable income and the overall economic growth have created demand for various new categories of consumer goods, including healthcare and wellness products. In the recent years, the fast-growing consumer healthcare market has attracted several traditional Indian pharmaceutical companies, largely selling prescription medicines, to foray into the over-the-counter (OTC) products.
Globally, big pharma companies have been able to create a successful OTC product business due to their inherent skills in research and development (R&D). In India too, the potential is huge because the consumer healthcare category is underpenetrated.
Consumer healthcare market can be broadly classified into categories such as health supplements, analgesics, gastrointestinal products, wound healing products, dermatology products, lifestyle and weight management products, and smoking cessation products.
For pharma companies, getting into the OTC segment is a natural extension given their capabilities in developing healthcare products. Although the size of OTC business of most Indian pharma companies is relatively small currently, opportunities in this space are plenty on account of growing awareness about health and wellness, more people opting for self-medication, rising lifestyle-related health problems, urbanisation and gaps in product offerings from fast-moving consumer goods firms.
According to a recent report by market research company Euromonitor International, consumer healthcare market in India grew at a compounded annual growth rate of 11.5 per cent between 2012 and 2017. By 2022, the market is expected to reach Rs 310.3 billion from Rs 254.3 billion estimated for 2017.
While the consumer healthcare space is interesting, it is a long-term investment game and the competition is strong. Hence, it is crucial to pick differentiated products and create innovative healthcare solutions keeping in mind the growing needs of consumers. Product selection has been one of the strong points for Glenmark with its female hygiene product Vwash being a category creator in consumer healthcare market. Other major OTC products of Glenmark are Candid Dusting Powder, a 30-year-old flagship and a prescription leader in the category of fungal skin infection and Scalpe+, a 17-year old brand with a proven track record in dandruff treatment. We are now exploring brand extensions. We have recently launched Vwash sanitary napkins.
The other important factors for companies are building a strong marketing and distribution network and investing in advertising and promotion if they want to succeed in the OTC segment. It is imperative to have a focused approach as market dynamics in the consumer healthcare space are very different from the pharma products market.
Pharma companies should come up with initiatives to capture new markets, have an ability to change marketing strategies to cope with new challenges in the business environment, and try to create strategies to promote their products into the untapped semi-urban and rural markets.
Currently, the sale of consumer health products in India continues to be driven by chemists or pharmacies; penetration of OTC products into traditional grocery retailers and modern trade remains relatively low. However, companies have started focusing on these traditional channels to reach out to consumers in rural and semi-urban regions of the country.
Companies need to have a consumer-centric mindset and offer products that make their lives better and easy, allowing them to follow their daily routine without any worry.
The consumer healthcare segment is still fragmented in India, and there is a significant room for disruption. The market is expanding, So if the market approach is right, product selection is right, and there is willingness to invest in long-term sustainable growth, OTC is a lucrative opportunity for Indian pharma companies.
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