Patanjali vs MNC’s : should Patanjali’s dizzying growth worry the competition?

Has anyone imagined? How and whether a YOGA GURU will pose a threat to an already established multinational company in the  fast moving consumer goods market in the country?

Patanjali, Ayurveda – a company started by Baba Ramdev recently posted revenues of Rs.10,561 crore for the financial year 2017 (April 1, 2016 to March 31, 2017). That’s double of what it posted last year. What’s more, while most FMCG firms in the country grew around 8% to 12% annually over the past five years, Patanjali has grown over 20 times. So, what is the magic behind the company’s phenomenal growth so far?

Patanjali’s growth is mainly due to 3 reasons :

  • Baba Ramdev’s personal brand equity.
  • It’s a home-grown brand and is 15% -30% cheaper than its competitors.
  • The company’s positioning and rise in goodwill due to the goodness of Ayurveda and natural ingredients.

Baba Ramdev unleashed a whole range of herbal products to turn the entire FMCG business upside down, and then expanded into a whole range of other businesses from ayurvedic media, food products, textiles & garments and even security solutions.

Baba Ramdev led Ayurvedic brand Patanjali has come up with yet another weapon to fight its multinational competitors. The Haridwar based company is likely to partner with eight leading retailers and aggregators which, as forecasted, will give a huge boost to its online sales.

Its ‘swadeshi’ range of Fast Moving Consumer Goods (FMCG) products may be available on major e-commerce websites. The list of big names includes – Amazon, Flipkart, Paytm Mall, 1MG, Bigbasket, Grofers, Shopclues and Snapdeal, among others. These partnerships with e-tailers will be in addition to its own portal patanjaliayurved.net, where the company is selling its products online.

A 2017 Nirmal Bang report revealed that the brand had already reached nearly 53% households in personal care and 26% in food products, up by nearly 100%, since last year.

Recently, Patanjali had forayed into the area of kids and adult diapers and affordable sanitary napkins segments. Last month, it had also announced that it plans to venture into solar equipment manufacturing. Besides the FMCG segment, Patanjali Ayurved is present in other sectors such as education and healthcare. The company is even known for its strong distribution sector.

On 5 January 2018, the official spokesperson hinted at the path-breaking news through his Twitter post that read, “Patanjali Ayurveda has started working on a massive online push. The announcement of an agreement with world’s largest e-commerce companies will happen soon. A new chapter of online shopping of Patanjali products from many portals will begin soon.”

Patanjali spokesperson S K Tijarawala, in his statement, said, “Now, we will have an organized and systematic agreement with the players to place our all product online, so that it could reach to customers to the endpoint.

BABA RAMDEV’S DREAM FOR PATANJALI –

Baba Ramdev aimed at making Patanjali known worldwide and felt by the entire nation. According to a Business Standard report from July 2017, Patanjali aims to increase its number of distributors from 5,000 to 25,000 by 2019. The move was seen to be crucial to meet Ramdev’s ambitious target of annual sales of Rs. 1 lakh crore by 2020. With yet another attempt to change the FMCG products market, Patanjali is only moving closer to the dreams of Baba Ramdev.

Today, Patanjali has captured a large proportion of the market. The company ranks No. 7 in the FMCG space. Patanjali has imposed a huge threat to the MNC’s.

According to Baba Ramdev, MNC’s had entered the economy with the objective to ‘’loot’’ India. Therefore, he promises to make India free from MNC’s. Whether Patanjali would be able to do so in the coming year or not is something we all need t watch out for.

 

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