Kriti Soni*


The fast-moving consumer goods in the (FMCG) sector is India’s fourth-largest sector with household and personal care accounting for 50% of FMCG sales. Growing awareness, more comfortable access, and dynamic lifestyles have been the key growth operators for this sector. The urban segment (accounts for a revenue share of around 55%) is the largest contributor to the overall revenue generated by the FMCG sector in India. However, the last few years, FMCG market has grown at a faster pace in rural India compared to urban India. Semi-urban and rural segments are growing at a rapid pace and FMCG products account for 50% of the total rural spending.

Ayurvedic FMCG industry is based on the augmentation and marketing of products between food drinks, health, domestic and personal care, etc. In the current scenario, more than 30,000 proprietary and 1500 classical products are available in the market. The market of Ayurvedic FMCG products is estimated to record a combined annual growth rate (CAGR) of 16% between 2016 and 2021 and will grow from the current $ 500 million to $ 1.1 billion by 2021. Although many FMCG products advertise the estimated results, the Ayurvedic FMCG industry is largely irregular.

The shift toward natural products has gathered momentum. Also, companies of all sizes are racing to match the pace. This article reviews a snapshot of current trends in the FMCG market concerning herbs and spices that will provide development opportunities and strategies adopted by the multi-billion-dollar market.

Transformation in Indian FMCG Sector  

The value of the Indian cosmetics and skin care market is $ 274 million, and it is owned by many Ayurvedic FMCG companies. Changing awareness, easy access, and changing lifestyle are important development accelerators for the segment. Growth for the expenditure of consumers, increase in rural demand and advancement of premium products are significant for the growth in the number of Ayurvedic FMCG categories. According to Tech Sci Research, the market of Indian Ayurvedic FMCG products is estimated to record a CAGR of 16% between 2016 and 2021. It will increase from the current $500 million to $1.1 billion by 2021. People are deeply embracing Ayurvedic products, which has increased in the FMCG segment. Examples of legacy brands such as Patanjali, Dabur, Himalaya, Baidyanath, Emami, which are safely adding shelf spaces to new age disruptions. With a revenue target of ₹20,000 crores for FY 18, Patanjali Ayurveda Limited (PAL) is growing rapidly at 150% CAGR in the next 5 years.10 These disruptors have established strong capitalization on their experience in providing different preferences to the customers. The market for Ayurvedic products is estimated at ₹50,000 crores. The target of all the companies is to magnify globally in the next 5 to 10 years.


 1)To understand concept and need of ayurvedic products in FMCG market

2) To understand product chain line and practices of ayurvedic products in india

3) To understand challenges faced by ayurvedic products in FMCG market.

Market Share 

The urban region (revenue allocate of 60%) is the foremost contributor to the broad revenue caused by the FMCG sector in India with the market size of about $ 29.4 billion in 2016.In the last few years, the Ayurvedic FMCG market in rural India is emerging quickly with urban India. Per capita, the disposable income of rural India is mounting incessantly. As the level of income is grow-ing, there is an increase in non-food expenditure. The government announced its plans to spend $ 9.16 billion for the opening of more jobs in rural areas, which will increase demand for FMCG products. So, the rural FMCG market is supposed to rise from 17.41% to $ 100 billion CAGR throughout 2009-25.


  • Changing lifestyle : Approach to different pricing, improved lifestyle and chemical-free & organic products have become the new standard for Indian consumers.
  • Innovation : Consumers have started demanding customized products especially in according to their personal taste and needs. Many Ayurvedic companies have established innovative product portfolios for new customer. They are moving ahead through revolutionizing and improving natural products for the youth. Some of companies like Forest essentials and Vedix, produces customized skin care products.
  • Packing systems: Along with the safety and quality products, companies are opening smaller stock-maintenance units at a lower price. This helps them maintain margin, keep the volume from price-alert customers and enhance their customer base.
  • Network distribution: Companies are currently focused on improving their distribution network to increase their connectivity in rural India. Patanjali and Sri Sri-Tattva, leading Ayurvedic FMCG companies, are trying to decrease its paramount time by building its supply channel and getting retail stores directly from the manufacturing unit.

Companies which are formulating ayurvedic FMCG products

  1. Patanjali
  2. Himalaya
  3. Vicco group
  4. Dabur
  5. Baidyanath group


Ayurveda is an ancient system and used by our ancestors for maintaining healthy lifestyle. FMCG companies help the industry to bring new products in every possible way. This has increased the market growthand also helped the consumer to get connected to their products.

Head, Formulation Department at DABUR RESEARCH FOUNDATION*