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. View more at #Hindustan360.
The Baba Ramdev-led company’s sales jumped 64 per cent to Rs 731 crore in the six months ended December and rivals DaburBSE 0.08 % 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% growth in penetration, which is about 5% 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 home care and food and beverages, which still has a smaller base,” said Ramakrishnan.
Mass brands like Dabur, Emami and Patanjali are expected to continue to educate consumers about the benefits of using natural products through product promotions and in-store displays,” according to a 27 May report by Euromonitor International.
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.
Other brands are also taking benefits
Colgate-Palmolive (India) Ltd launched Cibaca Vedshakti, a toothpaste made of natural ingredients. The move was part of its strategy to counter Dant Kanti, a herbal toothpaste from yoga guru Baba Ramdev’s Patanjali Ayurved Ltd.
Dabur India Ltd, which has been hit by Patanjali’s honey and Chyawanprash, said in an investor call last month that it will launch more Ayurvedic products across Hair oil, Shampoo and Healthcare. According to Dabur India’s management projections, Ayurvedic products will constitute more than 75% of its sales in India by 2020, from around 60% at present.
Unilever, the parent of India’s largest packaged goods company Hindustan Unilever Ltd (HUL), last month, for the first time, acknowledged Patanjali’s impact and that the company has been launching herbal products to fight competition.
Emami Ltd and The Himalaya Drug Co., which have been selling herbal or Ayurvedic products for long, have gained from their traditional herbal positioning and have been expanding. While HUL bought Indulekha, home-grown Emami acquired Ayurvedic hair oil and shampoo brand Kesh King from SBS Biotech Ltd in June 2015 for Rs 1,651 crore to boost its presence in the ayurvedic space.
— Hindustan 360 (@Hindustan360) November 3, 2016
View more at #Hindustan360.