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PATANJALI TAKES ON

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 Question 1: Analyse the Patanjali brand and the key factors for its success.

Strength
1. Ramdev: The tremendous growth of Patanjali is attributable to Baba Ramdev and his
quality. For a new shaped FMCG, it would have been not possible to indicate the sort
of growth that Patanjali has shown in such a short time. However, the followers and
goodwill of Ramdev helped Patanjali to gain such significant success.
2. Nationalism: Patanjali has been marketed that it's a brand created in India for Indians.
Most of the products in India are international brands. Patanjali requests Indians to buy

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Indian products to assist the economy of the country. Besides this, the quality of the
product has helped within the fantastic growth of Patanjali

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3. Herbal Products: The merchandise that Patanjali offers contains Ayurved and Herbal
natural elements. The Swadeshi merchandise even has a crucial role within the success

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of Patanjali. India has a good supply of vegetation, and we get plenty of naturally
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grownup medicines in our dense forests. As a result, India is one of the leaders in
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Ayurved.
4. Pricing: Patanjali merchandise is typically worth 20-30 below the rival brands, and
therefore the rivals can't compete with Patanjali on price. They directly buy from
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farmers and thus cuts on intermediaries. Hence, they can manufacture at lower prices.
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5. Reliable Distribution Channels: Patanjali product is sold through Patanjali

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Chikitsalayas and Patanjali Arogya Kendras, Swadeshi Kendras. Patanjali already has
15000 outlets across India. Patanjali was earlier criticized for its distribution strategy;
however, it's currently improved by distributing through general retail outlets and has
recently engaged with the longer-term band for distribution through retail.
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6. E-Commerce Advantage: Patanjali sells through E-commerce corporations and has a

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variety of products that it sells online.

7. Word-of-Mouth Promotion: For a new company, mainly in the consumer
merchandise class, a high share of its expenditure goes into advertisements and
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promotions. Patanjali followed a spoken promotion strategy at first and didn't pay
abundant on promotions and advertising. Patanjali trusted over the complete loyalty of
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its customers.
8. The Trends: Patanjali was supposed to be a traditional Indian company; however, it's
surprised everyone by delivery in various changes needed to be at par with its
competitor brands. Be it advertising exploitation celebrities as Brand ambassadors,
getting into fashionable retail, or exploitation E-commerce as a platform. Patanjali has
also understood the potential of digital media and social media platforms and is
additionally disbursal on these channels.

Weakness
1. Dependency on Ramdev: Patanjali is still synonymous with Ramdev, and thus any
actions of Ramdev can have repercussions on the whole brand itself. Ramdev's political
affiliations are acknowledged, and therefore if in any respect he's targeted for any
political feud, Patanjali also will suffer.

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 2. A Low variety of producing Units: Patanjali has set itself an ambitious target. For that
to happen, Patanjali would want to line up producing units in several parts of the
country, which might need significant investments. It additionally would have to move
from the old strategy to a new approach.
3. Product Pricing: Patanjali might need to compromise on its pricing methods if it
needs to expand, and so it's an enormous challenge for Patanjali. It cannot sell at such
low prices in the future.
4. Product Dependence: Patanjali has many products in its portfolio; however, a
significant part of its revenues comes from 5-6 of its main products like its toothpaste
and ghee. They must push the remaining products to achieve their goals.

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5. Low Margin to Distributors: Patanjali offers lower margins to distributors and

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retailers as compared to its competitors since it's relishing a game of volume and not

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6. Lack of Management Professionals: Patanjali doesn't have a massive pool of
management professionals and thinks tanks, which may be a hindrance to international

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growth.
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Opportunities

1. Growing organic sector: Patanjali has successfully spread awareness about the
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benefits of herbal products creating a market for itself and the demand is ever-growing.
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2. Expand Rural: The diverse product portfolio has great potential in the rural market.
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Patanjali should try to expand in the vast rural market of India.

3. Going Global: Competitors of Patanjali has expanded into the international market.
Patanjali should also try to seize the opportunity by expanding into the Middle-East and
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African Nations for a start.

4. Tie-Ups: Patanjali is already in tie-up with Future Group and the venture has been
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successful so far. They should continue to collaborate with other modern retailers and
should look into entering the E-commerce platforms.
5. Diversify: Patanjali’s competitors are diversifying their product range by entering
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into new product categories like clothing. Patanjali has always positioned as a desi
brand. Patanjali should utilize the opportunity of making Khadi a fashion statement.
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Threats
1.Increasing Competition: FMCG giants, like HUL, Marico and other new entrants
have identified the opportunity created by the awareness campaign by Patanjali and are
now entering the organic product market increasing the competition for Patanjali.
2.Negative Word-of-Mouth: Since Patanjali is quite new in the market any negative
word-of-mouth in the social media platforms can prove to be harmful for the position
of Patanjali in the market.

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 3.Poor reap can affect business: Main ingredients of the majority of the products of
Patanjali are naturally cultivated and bad yield can adversely affect the production of
the products and in turn, affecting the sales revenue.
4.Price war: Patanjali’s motto is to bring herbal and unadulterated products to the
masses at affordable prices. Earlier brands used to charge a premium for herbal
products. But the FMCG giants like HUL, Colgate and others have been in the market
for a very long time and therefore have deep pockets and will be able to bleed for longer
in retaliation of the low price charged by Patanjali. Such price war will drastically affect
the profitability of Patanjali as it is already operating at a very low margin.

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Question 2: Discuss the Marketing mix at Patanjali.

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Baba Ramdev and Acharya Balakrishna started Patanjali. In company, Ramdev held no

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stake, whereas Balakrishna held a 92% stake. The rest of the 8% stake is held by Sarvan
and Sunita Poddar, who gave their land to Patanjali. In FY 2015/16, Patanjali's revenue

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was around 45-50 billion, which was approximately 125-150 percent more in
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comparison to FY2014/15.
Without any prior market research, Patanjali launched its products in various
categories. Patanjali was following an umbrella strategy for its branding. That means
all sub-brands come under the category of Patanjali Brands. Its Marketing Mix
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includes:
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1) Product
The first product was aloe vera gel, which was promoted in Ramdev's yoga camps.
Currently, Patanjali has 400 stock-keeping units. The company is operating in four
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major categories: Ayurvedic Health Products, Food Products, Skin Care and Home
Care products, and Juices. Its best seller product is Cow Ghee followed by Dant Kanti
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toothpaste and Kesh Kanti Shampoo. The reason behind Patanjali's success over FMCG
product was its economical pricing. It adopted a low pricing strategy. Patanjali also
launched its premium product om Skin Care and Homecare category to compete with
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Maybelline LLC and L'Oreal S.A.

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2) Pricing
It adopted a lower pricing strategy. It priced its products approximately 15-20% lower
as comparison to other companies. The company took its raw material directly from
farmers; that is why the company can sell its products at a lower cost to its consumers.
In a nutshell, the company is using mass customization to create economies of scale.

3) Place
It used a franchise model to sell its products. Its outlets were classified as Patanjali
Chikitsalaya (dispensaries), Patanjali Arogya Kendra (health center), and Swadesi
Kendra (Indian-made goods). In Chikitsalaya and Arogya Kendra doctor was also
available to give prescription to patients. In 2015, Patanjali had approximately 500
franchise stores. It is products also available in online retail stores.

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 4) Promotion
Initially, Most of Patanjali advertisement is done by Baba Ramdev in his yoga camps.
However, Patanjali is also investing a lot in mass media marketing like television.
According to a report of Broadcasting Audience Research Council, Patanjali
advertisement was seen more in comparison to Fair and Lovely and Cadbury in the year
2015.
Its best marketing strategy was content marketing, which means they focused on
educating people about their products. Along with its quality products and an active
distribution network, Patanjali achieved success in the market. Patanjali also did a

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partnership with Future Retail Group to increase its visibility across a broad range of

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customers.

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We can understand the marketing mix of Patanjali with the help of the AIDA model of
buying behaviour. Patanjali, with its marketing mix, persuaded customers in each step

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(Attention, Interest, Desire, Action) of the buying decision process.
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Attention-
Unlike traditional marketing tools, Patanjali used word of mouth strategy to gain its
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desired attention from its prospective customers. Baba Ramdev, with his yoga camps,
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started spreading words about Patanjali products and the health benefits of consuming
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those.

Interest-
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After getting its desired attention, Patanjali started converting that attention into interest
by starting a movement against consuming foreign products produced by non-Indian
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brands like HUL, P&G, and others. Since it launched a campaign against consuming
non-Indian brands, it got an option to introduce its product, which will replace those
foreign brands and got an edge to penetrate this market.
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Desire-
Only starting a movement against boycotting foreign brand is not enough, till there is
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replacement of those brands with Indian brands. Since products made by HUL, P&G
were much popular among Indians, replacing those brands was not easy. Patanjali
introduced herbal products with less chemical and explained its benefits over-
consuming existing products and thus creating a desire over those products.

Action-
Finally, the crucial task was converting those attention, interest, and desire into
purchase. Patanjali rightly understood the price-sensitive Indian consumer. It
introduced its products in the same line with other brands, but at much less price.
Moreover, this is how Patanjali converted most of its customers and became a critical
market-share holder in many product lines.

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 Question 3: What are the various growth and expansion strategies for Patanjali ?

Ansoff matrix is used when company is prospecting for expanding into other products
or market or other domains. It determines the feasibility and summary of how the
company has entered into the market and how has it introduced new products and

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diversified.

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