P K Dave05.01.08
It was not long ago that Ayurvedic herbs were only found in a handful of health food stores. These days, however, it is difficult to find a health food store that does not have an Ayurvedic herb on the shelf. And even in mainstream channels, food, drug and mass market grocery stores are starting to recognize the value of this class of herbs. Indeed, today a consumer does not have to go far to find products based on this ancient Indian system of medicine.
Some would argue that this centuries old herbal philosophy is ready to experience a growth spurt in the West. Does this mean that a new era for Ayurvedic herbs is coming? If so, what is the state of the market for Ayurvedic herbs and where is it likely to go? And in the midst of this growth in the U.S., how is the market in India doing? Are there trends in India that can be identified to help define strategies abroad?
Ayurveda is a lifestyle science that was developed in India nearly 4000 years ago. It is a holistic science based on a philosophy that good health comes from integrating all aspects of life such as herbs, food, exercise, yoga, massage and more. According to classical Ayurvedic theory, we are all born with a unique constitution referred to as Doshas, a mix of Vata, Pitta or Kapha. Each is present within our bodies and has a job to do: Vata is responsible for all motion, Pitta for all metabolic activities, and Kapha for maintaining the right amount of fluids in the body (i.e., water, blood, mucus, phlegm, etc.). While all of us must have the three Doshas in our body to exist, we are born with a combination of these forces that is rather unique to each of us. This combination helps define our physical, mental and emotional make-up-what keeps our body in homeostasis and in turn the healthiest state we can be.
When the body goes out of this balanced state, eventually disease can occur. Hence, Vata imbalances are exhibited in health conditions that have to do with movement, such as joint conditions. Pitta imbalances lead to all types of metabolic and digestive diseases. Kapha imbalances most often involve excess of fluids, such as conditions of the lymphatic system.
An Ayurvedic physician evaluates a patient's health by determining his or her inherent constitution and how imbalanced the body is. Treatment is based on managing a combination of herbs, diet, massage, lifestyle changes, etc., to bring the body back into balance and evacuate the disease.
Recent research has shown that consumers are beginning to accept the premise that there is no "magic pill" and that good health comes from integrating all aspects of life. Herbal therapies, diet, exercise and vitamins all work better when used as part of a lifestyle plan. Ayurveda has embodied this principal for centuries. As Americans seek ways to devise a healthy lifestyle plan, they will find Ayurveda offers all the tools they need to take care of their health on a daily basis. This may explain the resurgence in the acceptance of Ayurveda.
As the awareness of Ayurveda increases in the West, so will the consumer demand for Ayurvedic herbs. Some will follow classical Ayurveda and devise a lifestyle plan based on their Doshas (Vata, Pitta, Kapha). Many others on the journey of learning about Ayurveda will simply seek herbs that have been used to treat a variety of diseases for centuries. Most recently, Americans are discovering herbs like Gymnema sylvestre, which is used for blood sugar balance, or ashwagandha to help cope with stress and provide more energy.
Authoritative statistics about the retail sales value of Ayurvedic herbs in the U.S. are difficult to pin down. First of all, store scanner data does not separate Ayurvedic herbs as a category. Another complicating factor is that so many products are not purely Ayurvedic, but rather contain Ayurvedic ingredients. For example, many companies market formulas that contain glucosamine/chondroitin (not Ayurvedic) with Boswellia serrata (an Ayurvedic herb) in the formula. Tracking such hybrid products makes it even harder to estimate sales.
Store surveys published by industry sources estimate that retail sales of Ayurvedic products make up 1-2% of total supplement sales. This works out to at least $200 million based on 2006 figures. Still, many believe this figure significantly understates sales of Ayurvedic products in U.S.
One metric that can be used to arrive at a more accurate figure is the value chain percentage. According to Nutrition Business Journal, San Diego, CA, specialty herbal supplement raw material cost usually accounts for 11% of the retail price. Ayurvedic raw material sales figures are in excess of the figure this metric would yield. Additionally one still has to take into account the hybrid products sold that contain Ayurvedic ingredients but are not classified as "Ayurvedic." The ubiquity of ashwagandha or boswellia in so many formulas would support the argument that the sales of Ayurvedic herbs are significantly higher. It is then reasonable to conclude that retail sales of the category are far higher than $200 million.
Being the birthplace of Ayurveda, the Indian marketplace for Ayurvedic products is more established compared to other parts of the world, particularly the U.S. Additionally there is no category called "dietary supplements" in India yet, although that is likely to change in the near future (see side bar on page 47 for more details). The Indian Food Drug and Cosmetic Act has grandfathered Ayurveda and as such products are regulated as drugs. Any product based on the classical Ayurvedic formulary can be sold in the Indian market without any prior approval. Being classified as a drug, health and disease claims are permitted. While there are many products sold "over the counter," a majority of the products are required to place the statement that the product must be used under the supervision of an Ayurvedic physician. Not tied down by DSHEA-like structure/function claims, Ayurvedic products are easier to sell in India than in the U.S.
The other difference between India and the U.S. is that there is widespread acceptance of Ayurveda as a treatment option in India. There are more than 700 Ayurvedic hospitals with more than 35,000 beds and 435,000 Ayurvedic physicians [Source: Ayurvedic Drug Manufacturer's Association, Mumbai, India (ADMA)]. All of this makes treatments and product prescriptions more readily accessible compared to the U.S.
But it is also true that not all Indian consumers are knowledgeable about or accepting of Ayurveda. As a matter of fact, mainstream Indian consumers, much like their U.S. counterparts, prefer conventional allopathic medicines. Sales of the Indian pharmaceutical industry far outpace sales of the Ayurvedic industry. However, this is changing. Traditional and natural medicines are now becoming more popular in India, in part due to fewer side effects as compared to conventional drugs. Ayurvedic herbal medicines in India also cost less than drugs.
The retail value of the Ayurvedic products market in India is estimated to be around $1.2 billion (2005 figures) and is expected to reach $2.6 billion by 2012.
There are several products that are up and coming. Two that come to mind are amalaki (Indian gooseberry) and turmeric. Amalaki is the main ingredient in the traditional formula called chyawanprash, a product containing more than 43 ingredients. Chyawanprash is a powerful antioxidant and immune booster. The raw amalaki fruit is said to have 20 times more vitamin C as compared to an orange. Therefore it is no surprise that amalaki is now being positioned as a "superfood," used in formulations ranging from dry powder capsules to drinks and shake mixes.
Turmeric is the yellow spice used extensively in Indian cooking. Recent research seems to indicate that turmeric and its extracts contain anti-inflammatory compounds. Turmeric is already being used in several joint formulas. Topical uses of turmeric in India abound; such as an anti-bacterial first aid powder for application directly on minor cuts and bruises, exfoliant for the skin, and more.
There are several other herbs that should also be watched: Phyllanthus (a liver cleanser), picrorrhiza (a liver tonic) and shankhapushpi (anti-anxiety). Beyond these, growth in the U.S. will also come from a wider acceptance of the Ayurvedic philosophy. Products already on the market, such as ashwagandha, chyawanprash and triphala will soon be as easily recognized as ginseng, echinacea and senna.
While the upward trend for Ayurvedic product sales in the U.S. is clearly evident, sustaining this growth will require support from several fronts. One area that needs to be addressed is the availability of trained Ayurvedic practitioners. There also needs to be more education available about Ayurveda for practicing naturopaths. Regardless from which channel the consumer purchases an herbal supplement, a practitioner recommendation ranks high in creating a loyal customer base.
Efforts also need to be made to provide information and education to the retailer and consumer. This job has usually been left to the finished product marketer, as well it should. However, the raw material supplier needs to play more of a role in this respect. After all, the sales of the raw material greatly depend on consumer acceptance of the finished product, particularly if the product is new in the marketplace.
Last but not least, it is important that marketers of Ayurvedic products educate retailers and consumers about the herbs in a way that creates differentiation. Ayurvedic products must stand out rather than "blend in" to the crowded field of herbal supplements. Without this, there may not be a compelling reason for consumers to switch from an herb (or brand) that they are already using.
Ayurveda offers a wide choice of products for daily well being, for adjuvant support in disease treatment, for treating health conditions with fewer side effects, and let us not forget, for beauty. As more of these products come to market, the consumer will find these tried and true remedies becoming an indispensable part of their own healthcare.
About the authors:
Some would argue that this centuries old herbal philosophy is ready to experience a growth spurt in the West. Does this mean that a new era for Ayurvedic herbs is coming? If so, what is the state of the market for Ayurvedic herbs and where is it likely to go? And in the midst of this growth in the U.S., how is the market in India doing? Are there trends in India that can be identified to help define strategies abroad?
Ayurveda Primer
Ayurveda is a lifestyle science that was developed in India nearly 4000 years ago. It is a holistic science based on a philosophy that good health comes from integrating all aspects of life such as herbs, food, exercise, yoga, massage and more. According to classical Ayurvedic theory, we are all born with a unique constitution referred to as Doshas, a mix of Vata, Pitta or Kapha. Each is present within our bodies and has a job to do: Vata is responsible for all motion, Pitta for all metabolic activities, and Kapha for maintaining the right amount of fluids in the body (i.e., water, blood, mucus, phlegm, etc.). While all of us must have the three Doshas in our body to exist, we are born with a combination of these forces that is rather unique to each of us. This combination helps define our physical, mental and emotional make-up-what keeps our body in homeostasis and in turn the healthiest state we can be.
When the body goes out of this balanced state, eventually disease can occur. Hence, Vata imbalances are exhibited in health conditions that have to do with movement, such as joint conditions. Pitta imbalances lead to all types of metabolic and digestive diseases. Kapha imbalances most often involve excess of fluids, such as conditions of the lymphatic system.
An Ayurvedic physician evaluates a patient's health by determining his or her inherent constitution and how imbalanced the body is. Treatment is based on managing a combination of herbs, diet, massage, lifestyle changes, etc., to bring the body back into balance and evacuate the disease.
American Consumers & Ayurvedic Herbs
Recent research has shown that consumers are beginning to accept the premise that there is no "magic pill" and that good health comes from integrating all aspects of life. Herbal therapies, diet, exercise and vitamins all work better when used as part of a lifestyle plan. Ayurveda has embodied this principal for centuries. As Americans seek ways to devise a healthy lifestyle plan, they will find Ayurveda offers all the tools they need to take care of their health on a daily basis. This may explain the resurgence in the acceptance of Ayurveda.
As the awareness of Ayurveda increases in the West, so will the consumer demand for Ayurvedic herbs. Some will follow classical Ayurveda and devise a lifestyle plan based on their Doshas (Vata, Pitta, Kapha). Many others on the journey of learning about Ayurveda will simply seek herbs that have been used to treat a variety of diseases for centuries. Most recently, Americans are discovering herbs like Gymnema sylvestre, which is used for blood sugar balance, or ashwagandha to help cope with stress and provide more energy.
Authoritative statistics about the retail sales value of Ayurvedic herbs in the U.S. are difficult to pin down. First of all, store scanner data does not separate Ayurvedic herbs as a category. Another complicating factor is that so many products are not purely Ayurvedic, but rather contain Ayurvedic ingredients. For example, many companies market formulas that contain glucosamine/chondroitin (not Ayurvedic) with Boswellia serrata (an Ayurvedic herb) in the formula. Tracking such hybrid products makes it even harder to estimate sales.
Store surveys published by industry sources estimate that retail sales of Ayurvedic products make up 1-2% of total supplement sales. This works out to at least $200 million based on 2006 figures. Still, many believe this figure significantly understates sales of Ayurvedic products in U.S.
One metric that can be used to arrive at a more accurate figure is the value chain percentage. According to Nutrition Business Journal, San Diego, CA, specialty herbal supplement raw material cost usually accounts for 11% of the retail price. Ayurvedic raw material sales figures are in excess of the figure this metric would yield. Additionally one still has to take into account the hybrid products sold that contain Ayurvedic ingredients but are not classified as "Ayurvedic." The ubiquity of ashwagandha or boswellia in so many formulas would support the argument that the sales of Ayurvedic herbs are significantly higher. It is then reasonable to conclude that retail sales of the category are far higher than $200 million.
The Market in India
Being the birthplace of Ayurveda, the Indian marketplace for Ayurvedic products is more established compared to other parts of the world, particularly the U.S. Additionally there is no category called "dietary supplements" in India yet, although that is likely to change in the near future (see side bar on page 47 for more details). The Indian Food Drug and Cosmetic Act has grandfathered Ayurveda and as such products are regulated as drugs. Any product based on the classical Ayurvedic formulary can be sold in the Indian market without any prior approval. Being classified as a drug, health and disease claims are permitted. While there are many products sold "over the counter," a majority of the products are required to place the statement that the product must be used under the supervision of an Ayurvedic physician. Not tied down by DSHEA-like structure/function claims, Ayurvedic products are easier to sell in India than in the U.S.
The other difference between India and the U.S. is that there is widespread acceptance of Ayurveda as a treatment option in India. There are more than 700 Ayurvedic hospitals with more than 35,000 beds and 435,000 Ayurvedic physicians [Source: Ayurvedic Drug Manufacturer's Association, Mumbai, India (ADMA)]. All of this makes treatments and product prescriptions more readily accessible compared to the U.S.
But it is also true that not all Indian consumers are knowledgeable about or accepting of Ayurveda. As a matter of fact, mainstream Indian consumers, much like their U.S. counterparts, prefer conventional allopathic medicines. Sales of the Indian pharmaceutical industry far outpace sales of the Ayurvedic industry. However, this is changing. Traditional and natural medicines are now becoming more popular in India, in part due to fewer side effects as compared to conventional drugs. Ayurvedic herbal medicines in India also cost less than drugs.
The retail value of the Ayurvedic products market in India is estimated to be around $1.2 billion (2005 figures) and is expected to reach $2.6 billion by 2012.
Future Developments for Ayurvedic Herbs
There are several products that are up and coming. Two that come to mind are amalaki (Indian gooseberry) and turmeric. Amalaki is the main ingredient in the traditional formula called chyawanprash, a product containing more than 43 ingredients. Chyawanprash is a powerful antioxidant and immune booster. The raw amalaki fruit is said to have 20 times more vitamin C as compared to an orange. Therefore it is no surprise that amalaki is now being positioned as a "superfood," used in formulations ranging from dry powder capsules to drinks and shake mixes.
Turmeric is the yellow spice used extensively in Indian cooking. Recent research seems to indicate that turmeric and its extracts contain anti-inflammatory compounds. Turmeric is already being used in several joint formulas. Topical uses of turmeric in India abound; such as an anti-bacterial first aid powder for application directly on minor cuts and bruises, exfoliant for the skin, and more.
There are several other herbs that should also be watched: Phyllanthus (a liver cleanser), picrorrhiza (a liver tonic) and shankhapushpi (anti-anxiety). Beyond these, growth in the U.S. will also come from a wider acceptance of the Ayurvedic philosophy. Products already on the market, such as ashwagandha, chyawanprash and triphala will soon be as easily recognized as ginseng, echinacea and senna.
While the upward trend for Ayurvedic product sales in the U.S. is clearly evident, sustaining this growth will require support from several fronts. One area that needs to be addressed is the availability of trained Ayurvedic practitioners. There also needs to be more education available about Ayurveda for practicing naturopaths. Regardless from which channel the consumer purchases an herbal supplement, a practitioner recommendation ranks high in creating a loyal customer base.
Efforts also need to be made to provide information and education to the retailer and consumer. This job has usually been left to the finished product marketer, as well it should. However, the raw material supplier needs to play more of a role in this respect. After all, the sales of the raw material greatly depend on consumer acceptance of the finished product, particularly if the product is new in the marketplace.
Last but not least, it is important that marketers of Ayurvedic products educate retailers and consumers about the herbs in a way that creates differentiation. Ayurvedic products must stand out rather than "blend in" to the crowded field of herbal supplements. Without this, there may not be a compelling reason for consumers to switch from an herb (or brand) that they are already using.
Ayurveda offers a wide choice of products for daily well being, for adjuvant support in disease treatment, for treating health conditions with fewer side effects, and let us not forget, for beauty. As more of these products come to market, the consumer will find these tried and true remedies becoming an indispensable part of their own healthcare.
