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Tag: Patanjali Ayurved

  • Patanjali Ayurved is on way to $1bn sales in FY17 with HUL, ITC, Nestle India and Britannia occupying the top 4 slots amongst FMCGs

    Patanjali as 5th largest Indian FMCG?

     

    By Namrata Singh & Partha Sinha

     

    At Patanjali Ayurved’s manufacturing facility in Haridwar, there is brisk activity as cartons of freshly made products are being loaded onto trucks to be dispatched to stores across India. With the financial year nearing a close, an official pointed explained, all hands are on the deck to help the company achieve its targeted turnover of Rs 5,000 crore this fiscal.

     

    For a manufacturing company set up about 10 years ago, achieving a Rs 5,000-crore turnover is not easy. However, for Patanjali Ayurved, which is breaking conventional marketing norms, sales are inching up month on month. Sources in the know believe Patanjali could have clocked monthly sales of around Rs 600-700 crore in January and February, which means Baba Ramdev’s baby could become a billion-dollar entity, with its annualised turnover expected to cross the Rs 7,000-crore mark before the end of fiscal 2017.

     

     

    Brand Patanjali driving buzz on social media

     

    By Anumeha Chaturvedi

     

    Brand Patanjali generated around 15000 conversations on Twitter in the period between August 2015-January 2016, according to data compiled by social media analytics firm Blueocean Market Intelligence.

     

    Chatter around Patanjali was largely around its competitiveness (60%) as an FMCG brand. Some discussions were also led by the indigenous nature (17%) of the brand, the quality of its products (13%) and its marketing strategy (10%).

     

    In many instances, discussions/posts around the brand referred to Baba Ramdev thereby indicating that the brand is strongly associated with Baba Ramdev and he is a strong brand ambassador driving the brand’s image.

     

    A lot of buzz was observed around Patanjali becoming a strong threat in terms of market share to rival MNCs such as Colgate, HUL, ITC and Emami, in the FMCG space.

     

    Discussions touched upon Patanjali emerging as a strong player in the FMCG market; particularly its soaring sales graph gathered a lot of attention.Many consumers were seen commenting on how their products, particularly noodles and honey were not only cheaper but also better than those of other competitors. Few consumers went to the extent of expressing their wishlist of products such as sanitary napkins, fairness creams, that they expect in future from Patanjali. Top trending hashtags for the brand were Patanjali, Ramdev, and Babaramdev, according to Blueocean.

     

    In terms of its marketing strategy, discussions centered around Patanjali’s tie-up with Future Group. This partnership was seen as a sound approach to further strengthen the brand’s foothold in the FMCG market through Future Group’s outlets such as Big Bazaar and Easyday.

     

    Furthermore, efforts such as launching Patanjali Atta Noodles in the absence of Maggi noodles in the market, targeting market segments dominated by MNCs, direct marketing, seeking exclusive space at stores, were appreciated as compelling and strategic marketing moves

     

    The brand’s marketing related update that it is focusing on advertising and has kept aside Rs 300 crore for advertising and promotion, also gathered some attention according to the research.

     

    Which means, Patanjali could become the fifth largest FMCG company in the country, after Hindustan Unilever, ITC, Nestle India and Britannia Industries. This would bring it well ahead of traditional FMCG players like Dabur, Godrej Consumer Products and Marico.

     

    In an exclusive interview at the company’s headquarters, Acharya Balkrishna, MD, Patanjali Ayurved, said in the current fiscal, as of early-March, the company’s turnover has already crossed Rs 4,500-crore and is cruising at a monthly rate of about Rs 500-550 crore. “Our target is to go be yond Rs 500 crore a month.Because we are also making plans for future expansion, we are moving in line with the target,“ he said.

     

    “We may even reach Rs 600 crore a month mark -that will give us an annual turnover of approximately Rs 7,000 crore,” said Balkrishna.

     

    Even at the current level of Rs 4,500-crore turnover, Patanjali has paced ahead of oral care leader Colgate-Palmolive (India), challenging it which its `Dant Kanti’ toothpaste.

     

    Given that Patanjali has been grabbing eyeballs through its advertising, industry experts believe the company could soon even reach Rs 10,000 crore turnover, which would make it as big as ITC’s non-tobacco FMCG sales.But Balkrishna said that would take time. “We have to plan, right from procurement of raw materials to processing to manufacturing and marketing. We work on a single channel right from the farmer to the end consumer and that is the real reason why our quality and costs are under control. There are very few companies in the world which may be following such a system,” he said.

     

    “We buy raw materials directly from the farmer. In other companies, raw material sourcing and marketing of products are done by different entities. So we don’t have sudden peaks and troughs in growth, we plan a steady growth. It’s not like a share market where one day there is growth and the other day a slump,” Balkrishna said.

     

    The rural market is another area where FMCG biggies could face a tough challenge from Patanjali’s products, which are priced below regular brands because the company consciously operates on thin margins. “We are expanding our reach through tempos which can go deeper into rural markets. We will begin with 500-600 tempos and will gradually expand the network,” said Balkrishna.

    Source:The Economic Times
    Copyright © 2016, Bennett, Coleman & Co. Ltd. All Rights Reserved
    Licensed to republish

  • Patanjali Ayurved injects new life into herbal market, helps rivals sell more personal care products

    Jai Patanjali! Jai Herbal!

     

    By Sagar Malviya & Neha Tyagi

     

    MUMBAI: In a short span of time, Patanjali Ayurved has not only made a name for itself among Indian consumers, but also fuelled expansion of the herbal products market and helped rivals sell more home and personal care products, grabbing share from MNCs.

     

    The Baba Ramdev-led company’s sales jumped 64 per cent to Rs 731 crore in the six months ended December and rivals Dabur and Himalaya grew in double digits in a consumer products market that expanded barely 6 per cent, according to IMRB data. The figures exclude commodity products such as ghee and atta.

     

    What’s helping these firms is a growing preference for Ayurvedic products known for natural ingredients and health benefits. In addition, herbal products are cheaper.

     

    “Patanjali has registered a near-80 per cent growth in penetration, which is about 5 per centage points on an absolute level, in one year,” said K Ramakrishnan, general manager, IMRB Kantar Worldpanel.

     

    “The first wave of growth came from personal care products only, but the recent growth has been driven by homecare and food and beverages, which still has a smaller base,” said Ramakrishnan.

     

    Patanjali started in 1997 as a small pharmacy in the holy town of Haridwar to make healthcare products and was incorporated in 2006 as a company to sell personal care, food and beverage products through its own outlets. The company expanded its reach from 200 Patanjali outlets in 2014 to 5,000 franchise stores currently and launched more than two dozen mainstream FMCG products as none of the existing herbal players catered to categories such as noodles, oats and detergents.

     

    In October last year, Patanjali formed a marketing partnership with Future Group, which will offer over 300 of its products in 77 categories through stores such as Big Bazaar in about 250 cities. Four months after partnering with Future Group, the country’s largest retailer, Patanjali products have cornered a 7-12 per cent share in categories such as detergents, toothpastes, soaps and shampoos at Big Bazaar stores. In food products including oats, noodles and honey, the share gains are 7-37 per cent, according to Dunnhumby, a UK-based research company that has tied up with Future Group for data science.

     

    Patanjali has grabbed share from non-Ayurvedic companies. While the growth of Ayurvedic brands in the face wash category increased to 50 per cent from 36 per cent earlier, the growth of non-Ayurvedic brands eased to 16 per cent from 21 per cent a year ago. The share of market leader Himalaya remained unchanged at 35 per cent as Patanjali gained 7 per cent share.

     

    In shampoos, sales of Ayurvedic brands more than doubled to 194 per cent, while for multinational companies, it declined to 15 per cent from 21 per cent earlier. Categories such as chyawanprash, amla and aloe vera juice saw growth double to 42 per cent, with Dabur retaining its 53 per cent market share.

     

    “This unusual phenomenon of consumer products market disruption is rare as brand erosion or loyalty for well-established brands generally doesn’t happen so quickly,” said Devendra Chawla, president, food and FMCG, at Future Group.

     

    Patanjali products were purchased by about 21 per cent of Future Group shoppers in January compared with 2 per cent in October. “While Ayurveda brands were always there, the entire category has now arrived with a bang, thanks to heightened awareness benefiting the overall ecosystem,” Chawla said.

     

    Patanjali attributes its success to consumer shift from non-Ayurvedic brands owned by multinationals to Indian herbal companies. Its products are on average 15-20 per cent cheaper than the competition and several rival companies have been running offers and promotions to compete with them.

     

    “Other Ayurvedic companies are coming up with good quality products at even cheaper prices, which is ultimately doing good. The country is huge and the FMCG market is so large that we may not be able to provide for everyone,” said Acharya Balkrishna, managing director at Patanjali Ayurved, adding that the company has almost met its sales target of  Rs 5,000 crore for the financial year ending March 2016, more than double the revenue of Rs 2,000 crore in 2014-15.

     

    Hindustan Unilever’s net sales increased 10 per cent to more than Rs 30,000 crore in the previous financial year and Colgate-Palmolive (India) sales rose 12 per cent to Rs  3,955 crore.

     

    Source:The Economic Times

    Copyright © 2016, Bennett, Coleman & Co. Ltd. All Rights Reserved

    Licensed to republish

     

  • Spirituality is on the path of marketing with Baba Ramdev, Art of Living and others foraying into the consumer space

    Trusts of Baba Ramdev, Art of Living etc emerge as large consumer product makers?

    By Writankar Mukherjee & Sarah Jacob

     

    Spiritual gurus and ashrams are widening their reach among the populace not just through their teachings but through products as well.

     

    If Osho slippers are a craze among fashionable youngsters, Baba Ramdev’s Patanjali line of personal care and packaged food products and Art of Living’s body lotions and ayurvedic energizers too are finding takers beyond their followers.

     

    “These products have the potential to challenge some of the top FMCG brands in the market,” Sanjiv Goenka, chairman of hypermarket chain Spencer’s Retail, says.

     

    Industry observers say spiritual trusts such as Sri Sri Ravi Shankar’s Art of Living, Baba Ramdev’s Patanjali Ayurved, Aurobindo Ashram, Pujya Bapuji’s Sant Shri Asharamji Ashram, Coimbatore-based Isha Foundation and the organisation that runs Swaminarayan Akshardham are all on the cusp of emerging large consumer product makers.

     

    Some of them plan to widen distribution of their products-so far largely sold at their ashrams-through kirana stores, supermarkets and online retailing. Some are entering into back-end integration for commodity sourcing and are building distinct brands.

     

    Spencer’s plans to sell such products at its outlets-there are more than 200 of them-and is open to offer larger shelf space than even some mainstream brands.

     

    “These organisations have huge brand pull and Ayurveda products always do well. It is a potent pull factor,” says Mr Goenka.

     

    Advertising veteran R Balki thinks it would take a while before these products compete with the established brands, but says they can create a niche for themselves. “These products have a great base or personality-they tend to connote health, nature and purity,” says Mr Balki, chairman of advertising agency Lowe Lintas & Partners.

     

    PROFITS FOR CHARITY

    Baba Ramdev started retailing his Patanjali line of FMCG products via through kiranas and modern retail in April. Acharya Balkrishnan, promoter of Patanjali Ayurved Products and a close aide of Ramdev, said this would allow the firm more than quadruple its sales to 2,000 crore this fiscal from 455 crore in 2011-12. If achieved, this would make Patanjali larger than Fair & Handsome and Boroplus-maker Emami and at nipping distance of Colgate-Palmolive. Patanjali Ayurved says it achieved a net profit of 100 crore last fiscal.

     

    Being not-for-profit organizations, spiritual trusts plough back all their profits to sustain their organisations and charitable work.  If Patanjali has decided that none of the board members will earn from the company’s profits, others too say profits from sales will be used to support their activities.

     

    “Through the sale of the products, Art of Living funds its various service initiatives like the 185 free schools which it runs in the Naxal and the tribal belts of India,” says Umesh Pradhan, trustee at Sri Sri Ayurveda Trust, the FMCG arm of Art of Living. The trust makes creams, shampoos, body care lotion, scrubs, cleansing milk, soaps, ayurvedic energisers and juices.

     

    Isha Foundation, which has recently ventured into the FMCG space, says the foray is to support its various activities. Pondicherry-based Aurobindo Ashram, which forayed into FMCG products as vocational development for its inmates, now retails incense sticks, soaps, candles, perfumes and furniture through Khadi Bhandar and even in overseas.

     

    HOME, AWAY & ONLINE

    Consumer goods companies take years to build a distribution channel and consumer base while devoting large investments into branding. Big ashrams already have a loyal consumer base among their devotees running into millions.

     

    “Our devotees are our primary consumers,” says Mr Pradhan of Art of Living, which claims it has more than 300 million followers across the world. It sells its products through ‘Divine Shops’ set up at locations where it organises its programmes, as well as through the world’s largest online retailer Amazon.

     

    Ahmedabad’s Sant Shri Asharamji Ashram sells its products through outlets at ashrams, mobile vans and at devotees’ homes.

     

    Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha (BAPS), the socio-spiritual Hindu organisation that runs Swaminarayan temples and Akshardham in New Delhi and Gandhinagar, retails at 800 temples across India, US and UK. Its chyawanprash, honey, oil, tea, shampoo and dental care products, sold under BAPS Amrut brand, are also retailed online.

     

    Baba Ramdev, meanwhile, has big-ticket plans for rural India. His Patanjali Ayurved plans to launch swadeshi seva kendras with self-help groups by August.

     

    “We hope to open around one lakh swadeshi kendras, especially in villages with less than 3,000 people so that they become self-sufficient and empowered,” says Mr Balkrishnan of Patanjali Ayurved.

     

    BETTING ON HEALTH, CULTURE

    So what ties spirituality with consumer goods? “Once you come into the spiritual path, you understand how it is connected with the body and mind. You tend to become conscious of chemicals being used on your body and prefer more organic food,” says CR Sudarshan, a volunteer at Art of Living’s ayurvedic clinic and its retail chain Divine Shop in Bangalore.

     

    Sant Shri Asharam ji Ashram’s brochures say its products extend the benefits of “the pristine rishi culture to the masses at lowest cost possible”. Patanjali Ayurved is pitching its products as “swadeshi,” claiming they are at least 30% cheaper than national brands.

     

    Inputs from Sagar Malviya in Mumbai

     

    Source:The Economic Times

    Copyright © 2012, Bennett, Coleman & Co. Ltd. All Rights Reserved