Ayurveda is believed to have originated in the Vedic times around 5,000 years ago in India. Dabur India and Baidyanath group are considered the front runners in India’s manufacturing Ayurvedic medicines and have presence in the country for more than 100 years. However, there has been a major paradigm shift in the industry with the Advent of Ayurveda 2.0 which denotes the stakeholders using technology as an enabler in the industry. As of now, Indian companies have started using modern technologies and incorporated new models in this ancient system thereby transforming the current scenario of the market.
In conversation with Mr. Aadil Shah, Founder & Chief Executive Officer (CEO) AADAR -Health & Wellness, Ayurveda focused Digital Brand, we attempted to seek his opinion and understand his side of story to Ayurvedic Industry in India.
Here are some excerpts of the interview:
1. In your viewpoint, how would you differentiate an Ayurvedic product with Herbal product?
There is a very subtle difference between the two. Ayurvedic products are formularized concoctions based on the Ayurveda texts. On the other hand Herbal products use plants and their extracts which may not be a part of the herbs prescribed under the Ayurveda texts. In short, all Ayurvedic products are Herbal products but all Herbal products are not Ayurvedic.
2. According to our findings, the market size for India Ayurvedic products market is estimated to be between INR 30,000 crores – INR 35,000 crore in 2019. Do you find this number to be realistic? How much growth rate are you expecting on year on year basis for the next 5 years?
The number seems to be in the range and the future predictions are said to be around USD 8 Billion by 2022 and I feel that it would be a possible achievement. Many of the reasons for the growth of this market include increasing awareness among customers, increase in number of chronic diseases at early ages due to the fast paced lifestyle, and the inability and incompetency of the pharma industry to treat and catch these diseases at an early stage. In addition the drop in consumer trust in the pharmaceutical industry has further added to growth of this industry.
3. What are your views about the industry’s growth considering the current scenario?
Apart from the various qualitative factors there are a lot of quantitative factors such as the increase in the number of internet users, rise in the number of ageing population and others. However, Crisis like outbreak of corona virus provides an opportunity for the Ayurvedic industry to make its mark in the health and wellness industry. The only cure possibly available or up to some extent is available in Ayurveda, for instance Amway is allowed to produce some Ayurvedic products in China which are supposed to boost immunity and obviously not cure but fight against the virus. There are n numbers of things which are proving the benefits of the ancient system again and again.
4. Can you brief us about your company in terms of turnover, team size and product offerings? Do you manufacture your own product or sell it as a private label?
We have products in digestive category, cholesterol, obesity, energy & stress relieve, sexual wellness, menstrual wellness and we also have launched a vegan source of omega 3. These are the 9-10 functional products we have in our portfolio. We are currently have a team of 10-12 people with a turnover of around 2 crores annually and have a growth of 20-25% every month. We don’t do private label, we have our formulations but we also don’t manufacture. So, we have someone who manufactures for us with our given set of formulations developed by our own R&D department.
5. Although there are many Ayurvedic products available in the market, they have a common offering “to provide nutrition and supplementation that are all natural, sugar free, chemicals free, and inspired from ayurveda”? How are your products different? What is the problem you are trying to solve?
Our product is supremely effective and heavily focused on efficacy. Most of our products will deliver efficacy in real good short time. For instance our digestive products will show its effect within one or two days. Most of these products are kind of mediation effective except for obesity and diabetes which take around three months. The kind of efficacy we provide that gives a very good opinion of our products for which the customers pay and they actually vouch for it.
6. The key suppliers in the Ayurveda segment are Dabur India, Sri Baidyanath Ayurvedic Bhawan and Zandu Pharmaceuticals, which together account for a major market share in the industry of India’s Ayurvedic products market, how did you establish your brand with such a fierce competition? What were your assumptions when you entered the market, learning’s that you have?
My first assumption was that people are getting more aware about their health and hence they are slowly getting more aware on how to prevent chronic , second assumption was the millennial crowd or the people in the 30- 45 age group are getting aware of the ancient Ayurvedic remedies and they know its benefits. However, they do not know what brand to trust and where to buy. These were the major assumption I had, basis this product was positioned in such a way that it is effective immediately and the customer would get gratification as soon as possible. And hence we are predominantly on digital channels as well.
Secondly we positioned our brand in such a way that we are trying to bring back the good old habits to your lifestyle which is easy to adopt in the modern world. These are two ways which we use to market our products and the assumption which we had taken earlier came out to be more or less right. Also we have seen early stage buying of these products especially by millennials as a measure to maintain a healthy lifestyle. Seeing this trend we think that this is the way forward.
7. According to a survey conducted during our research, around 95.0% of the respondents ask for the manufacturers to be transparent in terms of the ingredients used. In such a scenario how do you promote your products?
Going forward we want to be more transparent about our products and supply chain and give as much detail as we can about the ingredients to our consumers. In accordance with your survey we also believe that we need to be transparent and we are trying to find ways to be as clear as possible in terms of the sourcing of the ingredients, tests performed, what are the benefits and other factors.
8. As per our research, two major challenges faced by the sector is shortage of manpower and low availability of quality raw materials. Do you believe this to be true? Are there any other challenges in the industry?
The Challenge is True to some extent but not completely. Firstly the purity of the material is always going to be a challenge, the material and ingredients of Ayurvedic products which are the plants and herbs were always in shortage and would remain to be so. Moreover, this shortage would become a much bigger challenge in the future. One way to solve this is for companies like us to dig deep into supply chain and include farms and other sourcing entities to build a robust ecosystem.
Secondly, I do not see manpower as a shortage; it is more like supply and demand. There are a lot of people in the Ayurvedic industry but they are not skilled enough to the current level competence and at the same time the industry is booming. So, as the market for these products grows bigger there will be more and more individuals entering this industry.
9. In 2014, Delhi Medical Council system announced that no Allopathy doctor should prescribe Ayurvedic medicine and called it a punishable offense. Do you think if there is a change of law, there is a scope for Ayurveda and Allopathy to work together?
Allopathic medicines although provide immediate relief but they do not treat the cause of the disease. In order to get to the root of disease on e needs to follow the Ayurvedic medicine regime. So there are benefits of both the streams but it is just about using the right thing at the right time. For instance if an individual is infected by a virus or bacteria, in typical cases Ayurveda would help you gain more immunity and prevent it, but if some infection has already happened you may need some Allopathy to subside it. Although there are some cases for which Ayurveda has a cure for instance dengue is curable via Ayurvedic remedies, but I believe both the systems have to co-exist.
10. Which Locations have the most demand for Ayurvedic products?
Tier 1 is just catching up to this industry and Tier 2 is already ahead of Tier 1 majorly due to the fact that that there are a variety of options available in Tier 1 cities for everything from Ayurvedic to allopathic products. However, in Tier 2 and Tier 3 cities there is an adoption of the home made remedies and hence they are more aware. In addition if you go to a Tier 2 city you will find more Ayurvedic remedies in one form or the other by which I mean the unorganized players. I personally don’t have a bias with the Tier of the city; it all depends on the channel of the product where I am selling.
For any queries or feedback, reach out to Namit@kenresearch.com
To Find India Herbal Extract Market Research Reports, refer to this link:-
“A habit you form is a habit that forms you, Inculcate Good Old Habits by Aadar”- Mr. Aadil Shah, Founder & Chief Executive Officer (CEO) AADAR -Health & Wellness, Ayurveda focused Digital Brand
Ankur Gupta, Head Marketing & Communications