VITAMINS DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION

VITAMINS & DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION IS THE PARTY OVER? DANIEL GRIMSEY, SENIOR RESEARCH ANALYST CMA NATIONAL CONFERENCE 2014 – 30 TH OCT 2014

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Euromonitor International: Global Market Intelligence © Euromonitor International CHA CONFERENCE 2014 2

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Euromonitor International Covers Your Industry • • • • Countries & Consumers Alcoholic Drinks Beauty & Personal Care Apparel Consumer Appliances Consumer Electronics Consumer Health Home & Garden Eyewear Fresh Food Health & Wellness Home Care Hot Drinks Luxury Goods Packaged Food Pet Care © Euromonitor International • • • Soft Drinks Tissue & Hygiene Tobacco Toys & Games Consumer Finance Travel & Tourism Retailing Consumer Foodservice Industrial Ingredients Packaging Automotive Euromonitor covers 100% of the market. 3

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Is the Party Over? % Growth of VDS in Asia Pacific 12 10 8 6 4 2 0 2005 -06 2006 -07 2007 -08 2008 -09 2009 -10 2010 -11 2011 -12 2012 -13 Asia Pacific © Euromonitor International Asia Pacific sans Japan 5

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Some Supplements are Dragging Growth Down… Evening Primrose Oil 3% CAGR © Euromonitor International C 0 Enzyme Q 10 Probiotic Supplements 2% CAGR 6

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Others Supplements are Lifting Growth Up Protein 13% CAGR © Euromonitor International Paediatric 10% CAGR Fish Oils 7% CAGR 7

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Asia is Ageing 500 400 300 200 100 0 20 1 02 20 0 20 3 0 20 4 05 20 0 20 6 0 20 7 0 20 8 0 20 9 10 20 1 12 20 13 20 14 20 1 20 5 16 20 1 20 7 18 20 1 20 9 20 Population in millions 65+ Population in Asia Pacific © Euromonitor International 9

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? The Fastest Growing Markets for Fish Oils 2008 -2013 “The average Chinese adult consumes only about one quarter of the recommended daily intake of DHA and EPA. WHO estimates that nearly 190, 000 died in China in 2010 due to low Omega-3 intake. ” 14% CAGR! © Euromonitor International “Consumers are getting more health conscious and starting to incorporate fish oils into their diet, as a defence against rising cholesterol levels. ” 10

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? The Fastest Growing Markets for Calcium 2008 -2013 “To educate Thai consumers about the risk of osteoporosis amongst the younger Thai population, the company invited orthopaedic surgeons as part of the campaign for free bone mineral density check-ups in 2013. ” “Due to the lack of calcium in the diet, Chinese consumers take the intake of calcium supplements seriously, particularly for the elderly and small children. ” © Euromonitor International 17% CAGR! “Through the media from newspaper to television, both online and offline, many more Vietnamese people have learnt its benefits. ” 11

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? The Fastest Growing Markets for Glucosamine 2008 -2013 “Glucosamine remained the strongest performing product… as it enjoyed high awareness not only among the country's aging population, but also among the rising number of consumers aged over 30 that frequently participated in sports and exercise. ” “As disposable incomes grew, many people were willing to spend more to take care of their parents as a way of showing their love and thanks. ” © Euromonitor International 29% CAGR! 12

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Philippines: Cal. Chews by Pascual Laboratories Inc Details Category: Calcium Supplement Launch date: May 2012 Main active ingredients: Calcium Retail Price: Ps 180/US$4 Source: www. iambrigette. com § Unique selling proposition (USP) or positioning: Cal. Chews is the first calcium supplement that is available in chewable format. In a chewable format, it is suitable for women on the go. It is available in chocolate and mocha caramel. © Euromonitor International 13

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Thailand: Nutrilite Cal Mag Pro by Amway (Thailand) Details Category: Calcium supplement Launch date: July 2013 Main active ingredients: Calcium, Magnesium, Vitamin D, Mineral and Alfalfa Retail price: Bt 1, 185/US$37 Source: http: //rakmaenaka. blogspot. com § Unique selling proposition (USP) or positioning: To urge young Thai consumers to take care of bone health from a young age, Amway (Thailand) invited the general public to try a bone mineral density (BMD) test for free at its designated Amway shops. The company is able to provide BDM tests to 15, 000 people annually. © Euromonitor International 14

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Pollution is Making Headlines across the Region • “China Pollution Levels Hit 20 Times Safe Limit” (The Guardian) • “Everything is sort of hazy. . like some sort of Kate Bush video or something” (Karl Pilkington, An Idiot Abroad) © Euromonitor International • “Air Pollution Behind Decline In Monsoon Rains” (The Times Of India) • “Surface Ozone Pollution Killing Crops 16

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 The Fastest Growing Markets for Vitamin E 2008 -2013 “Vitamin E is known as an antioxidant used by Thai women to promote skin health and slow down the ageing process. ” “Natur-E, the leading brand in vitamin E is promoted heavily, using pop star Sherina Munaf as brand ambassador. ” © Euromonitor International 17% CAGR! 17

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 The Fastest Growing Markets for Vitamin C 2008 -2013 “Boosted by a boom in vitamin C as consumers sought to boost their immune systems. ” “Given the increasing pollution and extreme weather changes in Indonesia, more consumers are taking vitamin C to prevent coughs, colds and the flu. ” 17% CAGR! © Euromonitor International 18

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 China: By-Health Pearl Powder Vitamin C&E by Guangzhou Byhealth Biological Engineering Co Ltd Details Category: Combination Dietary Supplements Launch date: January 2013 Main active ingredients: Pearl Powder, Vitamin C 1 & Vitamin E Retail price: RMB 298/US$49 Source: www. by-health. com § Unique selling proposition (USP) or positioning: Combined effects from pearl powder with Vitamin C and natural Vitamin E imported from U. S. to enhance immunity and promote skin health. © Euromonitor International 19

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Obesity, A Small But Growing Problem % of Population Obese 2000 -2020 20 % 15 10 5 0 India © Euromonitor International Indonesia China South Korea 21

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 The Fastest Growing Markets for Weight Management 2008 -2013 61% “Unlike other consumer healthcare categories, weight management continued to be dominated by direct selling players. ” CAGR! “In South Korea, individual distributors of Herbalife products are aggressive in attracting consumers. Most distributors open shops where consumers can relax and enjoy a foot massage. ” “Consumers usually want to lose weight quickly, so they are increasingly interested in meal replacement slimming products that are low calorie and high in fibre. ” © Euromonitor International 22

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Up and Away with Weight Management US$m 2008 -2013 900 800 700 2008 600 2009 500 2010 400 2011 300 2012 200 2013 100 0 India © Euromonitor International Indonesia Malaysia South Korea 23

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 The Fastest Growing Markets for Sports Nutrition 2008 -2013 “Sales performance of sports nutrition is gaining positive momentum in line with the growing number of gyms and fitness centres in Thailand as they become the socialising venues where Thai urban consumers spend more of their time on indoor exercise and body training courses. ” 18% CAGR! © Euromonitor International 24

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Sports Nutrition Showing its Muscle Sports Nutrition US$m 2008 -2013 120 100 2008 80 2009 60 2011 40 2012 20 2013 0 Thailand © Euromonitor International Indonesia China India 25

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 26 Collagen… It’s Asia’s Little Beauty Secret “Many tonics and bottled nutritive drinks products were positioned as beauty supplements to target the rising concern for maintaining a beautiful appearance by the female consumers. ” “Brand’s Inner. Shine Marine Collagen endorsed by model Pechaya Wattanamontri, whilst Thai actress/model, Laila Boonyasak, promotes Scotch Collagen Aora, a white beauty shot with a combination of collagen extracted from deep sea fish. ” © Euromonitor International 22% CAGR! “Due to their very expensive prices, their target consumers are limited to those on higher incomes. ”

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 China: Gomini High Fiber Drink Grapefruit by LUMI Biotechnology (Shanghai) Co Ltd Details Category: Weight Loss Supplements Launch date: August 2013 Main active ingredients: Dietary Fibre 6. 3 g/100 ml, L-Carnitine 300 mg/100 ml Retail price: RMB 546/ US$89 Source: http: //shop. lumilady. com/product-396. html § Unique selling proposition (USP) or positioning: Absorbs the necessary nutrients whilst suppressing hunger and burning fat. © Euromonitor International 27

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Singapore: Ruby. Collagen Essence by Cerebos Pacific Ltd Details Category: Tonics and Bottled Nutritive Drinks Launch date: April 2013 Main active ingredients : Collagen 3000 mg, Astaxanthin 2 mg Retail price: S$57/US$46 per 6 x 50 ml bottles Source: Euromonitor International § Unique selling proposition (USP) or positioning: The product is specially suited for Asian skin to retain skin suppleness and lessen fine lines appearance. Micro-collagen replenishes skin’s collagen supply and Astaxanthin protects skin against UV rays. © Euromonitor International 28

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Fastest Growing Markets for Paediatric Vitamins and Dietary Supplements 2008 -2013 36% “Paediatric vitamins and dietary supplements is an extremely niche market in India, which is primarily driven by the affluent urban consumer base. ” CAGR! A shift away from paediatric vitamins to paediatric Traditional Chinese Medicine. “Paediatric multivitamins in chewable gummies format, with a taste resembling confectionery, remained popular among children. ” © Euromonitor International 30

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Baby Boom? 1, 030, 000 1, 010, 000 990, 000 970, 000 950, 000 930, 000 Years © Euromonitor International 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 910, 000 2000 Population in millions Under 15 Population in Asia Pacific 31

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Philippines: Vita. Pops by United Laboratories Inc Details Category: Paediatric vitamins and dietary supplements Launch date: September 2012 Main active ingredient: Sodium ascorbate Retail price: Ps 10/US$0. 22 per sachet Source: www. unilab. com. ph § Unique selling proposition (USP) or positioning: Vita. Pops is the first and only paediatric vitamin C in the market that is like a candy that pops and fizzles in the mouth when taken. © Euromonitor International 32

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 Indonesia: Champ’s Emulsion by CCM Pharmaceuticals Sdn Bhd Details Category/subcategory: Pediatric Vitamins and Dietary Supplements Launch date: Mid 2013 Main active ingredients : Cod liver oil extract, Vitamin A, Vitamin D, Calcium Hypophosphite Retail price: Rp 50, 000/US$4. 10 for 350 ml Source: www. facebook. com/Champs. Emulsion. ID § Unique selling proposition (USP) or positioning: Claims to help increase children’s appetites, without them becoming overweight. Moreover, the product aims to optimise children’s brain development, as well as eye health, immunity, bone and teeth. © Euromonitor International 33

A SNAPSHOT OF ASIA’S AGEING POPULATION POLLUTION PROBLEMS BEAUTY BOOM BABY BOOM? IS THE PARTY OVER?

CHA CONFERENCE 2014 VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? Is the Party Over? Not Quite Yet % Value Growth 2005 -2018 Poly. (Asia Pacific sans Japan) © Euromonitor International Asia Pacific 20 17 -1 8 7 -1 16 20 -1 6 20 15 -1 5 14 4 20 -1 20 13 -1 3 12 2 Asia Pacific sans Japan 20 20 11 -1 10 20 09 -1 0 9 20 20 -0 07 20 08 -0 8 7 -0 06 20 20 05 -0 6 12 10 8 6 4 2 0 35

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 The Chinese and Indian Middle Classes are Almost as Enthusiastic as Americans 0 20 40 60 80 100 US India China Almost Every Day Japan 1 -2 Times A Week UK 1 -2 times a month Brazil Germany France On average, how often do you take vitamins/dietary supplements? © Euromonitor International 36

VITAMINS AND DIETARY SUPPLEMENTS IN THE ASIA PACIFIC REGION: IS THE PARTY OVER? CHA CONFERENCE 2014 There are Many Reasons to Feel Optimistic about the Future Baby Boom Beauty Boom Pollution Rising Middle Class Ageing Population Booming Economies © Euromonitor International 37

THANK YOU FOR LISTENING Daniel Grimsey Senior Research Analyst Euromonitor International www. euromonitor. com daniel. grimsey@euromonitor. com +61 (0)2 9581 9215