Malaysians are increasingly appreciating consumer health products like vitamins and dietary supplements, believing that taking supplements can help them improve their health and wellness. Indeed, Malaysian consumer is spoiled for choice when it came to health supplement, thanks to the wide range of supplements available and the presence of established international brand names in the local market such as Nutrilite, Live-well, Blackmores, and VitaHealth. Manufacturers of vitamins and dietary supplements have also used aggressive promotional campaigns to boost the popularity of health supplements.
Market growth by product category
The Malaysian market for vitamins and dietary supplements has grown rapidly over the last decade, with retail sales more than doubling from RM940.4m (USD248.3m) in 2005 to RM1.9b (USD572.6m) in 2014. Over the last ten years, this represented a compound annual growth rate (CAGR) of 7.0%. Retail sales of vitamins and dietary supplements increased 7.9% year on year in 2014, from RM1.7 billion (USD545.3 million) in 2013 , slightly higher than the 7.0% 10-year CAGR.
Retail sales of non-herbal/traditional dietary supplements more than doubled from RM278.4 million (USD73.5 million) in 2005 to RM576.2 million (USD177.9 million) in 2014. This represented a CAGR of 7.5%, which was slightly higher than the industry CAGR for the same time period.
Market share by product category
In terms of market share, dietary supplements accounted for 58.3% of total retail sales in 2014, or RM1.1 billion (USD333.9 million). This is followed by vitamins, which had retail sales of RM389.2 million (USD120.2 million) in 2014, translating into a 21.0% market share. Tonics and bottled nutritive drinks accounted for 18.0% of total retail sales in 2014, or RM333.0 million (USD102.8 million). Their market share has nearly doubled from 10% in 2005, thanks to a meteoric rise in popularity. Pediatric vitamins and dietary supplements had the smallest market share of 2.7% in 2014, with retail sales of RM50.9 million (USD15.7 million).
Non-herbal/traditional herb supplements accounted for a larger proportion of dietary supplement sales in 2014, accounting for RM576.2m (USD177.9m), or 53.3%, while herbal/traditional supplements accounted for the remaining sales, accounting for RM505.4m (USD156.0m), or 46.7%. Herbal/traditional supplements, on the other hand, have seen their market share eroding over the last decade. Herbal/traditional supplements dominated the market in 2005, accounting for 32.2% of total retail sales of RM302.7 million (USD79.9m). This fell to 27.2% in 2014, with retail sales totaling RM505.4m (USD156.0m). Herbal/traditional supplements, as well as tonics and bottled nutritive drinks, have largely lost market share to nonherbal/traditional supplements.
Multivitamins accounted for the majority of vitamin retail sales in 2014, accounting for RM243.4m (USD75.1m) or 62.5% of total vitamin retail sales, while single vitamins accounted for 37.5%, with retail sales totaling RM145.8m (USD45.0m). Vitamin C was the most popular single vitamin in 2014, as it has been for several years, with sales of RM92.8 million (USD28.7 million).
Major market players
Amway maintained its position as the local market leader in vitamins and dietary supplements in 2014, with total retail sales of RM302.2m (USD93.3m) accounting for a 16.3% market share. Amway has successfully defended its top position over the last decade with its popular international brand name Nutrilite, which offers a comprehensive portfolio of vitamins and dietary supplement products. Furthermore, the company has a strong network of direct sellers for its products. However, due to increased competition from other market players, its market share has declined from 19.4% in 2005 to 19.4% today.
Cerebos had the second highest market share of 9.1% in vitamins and dietary supplements, with total retail sales of RM169.5m (USD52.3m) in 2014, thanks to its popular Brand’s ® products, particularly Brand’s Essence of Chicken. Its retail market share has also increased significantly since 2005 when it was 5.2%. Cerebos acquired a market share of nearly 51% in the category of tonics and bottled nutritive drinks in 2014.
Cosway, a Berjaya Group subsidiary, is a well-known Malaysian brand that sells health supplements as well as personal care and household products. Its market share of vitamins and dietary supplements was 5.7% in 2014, with retail sales totaling RM106.3m (USD32.8m), ranking the company fourth in the vitamins and dietary supplements market.
Key trends and developments
As discussed below, Euromonitor has identified three key trends and developments that are expected to influence demand for consumer health products in Malaysia:
1. Herbal/traditional health products will continue to be popular
According to Euromonitor, herbal/traditional consumer health products will continue to gain traction in the Malaysian market, owing to consumers’ perceptions that herbal/traditional products are more effective and have fewer harmful side effects than non-herbal/traditional products. Cultural exposure to traditional products, combined with influence from family and friends, also contributes to consumer trust in their efficacy in self-treatment and disease prevention.
2. Changing lifestyles and demographic patterns in Malaysia will have an impact on the demand for healthcare products
Several key trends in Malaysian lifestyles and demographics are expected to shape future demand for healthcare products. According to a 2014 study published in the Lancet medical journal, Malaysia has the highest obesity rate in Asia, with 45.3% of its population classified as obese. Obesity was diagnosed in 49% of Malaysian women and 44% of Malaysian men.
3. Technological progress to support increased demand for healthcare products
According to a survey conducted by Google and TNS, a global market research firm, Malaysia is ranked as one of the top five nations in terms of smartphone usage, with 51% of smartphone users outnumbering 39% of computer users. Malaysia is also the leader in smartphone Internet access exclusivity, with 35% of Malaysian smartphone users surveyed relying solely on their smartphones to access the Internet. Furthermore, according to World Bank data, Malaysia’s internet penetration rate was 67.5% in 2014, higher than most of its ASEAN neighbors except Singapore (82.0%) and Brunei (68.8%).
The high level of internet savvy among Malaysians could have two effects: one, raising awareness of health-related issues, especially with the introduction of popular health websites such as MayoClinic.com, WebMD, and Mercola.com; and two, increasing retail sales of health care supplements through online channels. As a result, technological advancements in Malaysian society may increase the demand for healthcare products.