Deepansh Goyal

Roll No:- UM18265

Section-E
 F O U N D AT I O N

Baba Ramdev established the Patanjali Ayurved Limited in 2006 along with Acharya
Balkrishna with the objective of establishing science of Ayurveda in accordance and
coordination with the latest technology and ancient wisdom.

Balkrishna owns 98.6% of Patanjali Ayurved, and as of March 2018, has a net worth
of US$6.1 billion.
 PATANJALI:SUCCESS:FACTORS
Ramdev’s personal brand equity: Ramdev’s widespread popularity, propelled by
televised yoga camps, has provided the brand push for Patanjali. being associated with
Baba Ramdev helps in creating a perception among consumers that being ayurvedic,
Patanjali products are healthy.

Good quality at disruptive prices: Most Patanjali Products are priced

around 15-30% lower than competition. All because of buying raw material
directly from farmers and working on a single channel right from the farmer to the end
consumer, Lower overheads, Lower Distribution margins and lower advertising and
Promotional Spending.

Company’s positioning of the goodness of ayurveda and natural ingredients:

Positioning the quality, purity and natural promise at value pricing created a
strong demand pull. This pull was aptly serviced through an ecosystem of
distribution that supported fast proliferation in the market. No other FMCG major
earlier used exclusive brand outlets for their product range.
MARKETING COMMUNICATIONS : IMPORTANCE

Marketing Communications play a vital role in building a brand

and this is best portrayed in the case of Patanjali Ayurved Limited
which emerged as the fastest growing consumer products brand
by 2012. Some of the FMCG companies like Dabur and Emami
could not compete with the western FMCG companies due to low
financial and other resources. But this has not been the case with
Patanjali as it had Baba Ramdev as its forefront image and by 2015,.
the company manufactured and sold 800 different products including
medicinal, cosmetic, and food products.

Patanjali advertised through the direct method during yoga camps and
during the yoga programs that were telecast. When Sanskar channel
started telecasting. Ramdev’s yoga in 2002, millions of people across
the country began following him. After the first products were
introduced, Ramdev mentioned products like amla juice and aloevera
juice during the yoga camps, and people readily bought those products.
POSSIBLE STRATEGIES FOR OTHER COMPANIES

In order to regain market share from Patanjali, the companies like Dabur,
Britannia, Nestle, Colgate etc. need to first study the nature of their Indian
consumers’ purchase priorities. This will reveal their mistaken foothold
which Patanjali could easily capture.
Financial stability induced lower pricing of products and a fresh brand
image familiar to the Indian public can help these FMCG companies in the
long run.

Leaders like HUL and ITC, in order to retain their position as market leaders,
must look out for direct sourcing of raw materials which is now of primary
importance for emerging competition from Patanjali, as this can be a deciding
factor for leadership due to its shortage in the near future.
FUTURE CHALLENGES
Going forward, does Patanjali have the potential to make a big dent in the performance of other players? It’s a mixed
bag. In the FMCG space, if the initial idea is a success, the challenge comes in replicating the idea to other categories,
managing growth and managing category extensions.

Also, the leading FMCG majors have all spent significant time now to appreciate Patanjali as a key competition and have
developed strong counter-offensives. Therefore, the initial years of easy march may now hit some [roadblocks].

Patanjali needs to be “totally paranoid” about quality as it expands, says Bijoor“If Patanjali messes up on quality as it
expands, it will pay the price. That price will be a quick glass-ceiling for its volumes.”

Over the long term, the ayurvedic plank on which Patanjali’s products are positioned may work better for niche brands than
for category leaders. While all-natural ingredients may have consumer appeal in dairy, cooking oils, honey or health drinks,
they may prove less efficacious in household cleaning products, detergents or even processed food.
If Patanjali is serious about using fully organic formulations and natural ingredients, it has a tough task on its hands in
procuring these ingredients to fuel its furious growth. While there’s already an efficient, low-cost global supply chain in place
for chemical ingredients that go into conventional FMCG products, there are no such readymade solutions for ayurvedic
versions.
In fact, these are the key reasons why Indian FMCG players who enthusiastically adopted the ‘herbal’ plank have tasted
limited success in the past, whether it was the desi Himalaya and Zandu Pharmaceuticals, or Hindustan Unilever which had to
shelve its Ayush rollout.
 GROWTH CREDIT

Though it can be said safely that the growth of Patanjali may be

because of the sentiments of Indian consumers involved with the
founders, it is not entirely true. The business model of Patanjali along
with its strong media communications was also a major contributing
factor for its success.

Traditionally, all multinational and large domestic companies

advertised their products through indirect channels such as television,
newspapers, and magazines. Patanjali advertised through the direct
method during yoga camps and during the yoga programs that were
telecast.

Patanjali, which began as a nondescript company, took only a few

years to grow into a challenger to the existing FMCG companies in
India. In a span of a decade Patanjali became a Rs.50 billion company.
Its phenomenal growth could be gauged by the fact that Dabur took
more than 70 years to become a Rs.50 billion company.
REFERENCES

http://knowledge.wharton.upenn.edu/article/yoga-
guru-mastering-consumer-goods-market-india/

https://www.livemint.com

Bloombergquint.com
THANKYOU!