Patanjali Ayurved Limited

Prepared by Sayan Mukherjee Vaishna Hemanth Surendra Reddy Priyanka Shahi Uday Bhargav

Overview:

• Patanjali Ayurved is the fastest growing Indian FMCG company

• Manufacturing Units and headquarters located at Haridwar and registered office at Delhi

• It also has manufacturing unit in Nepal under the trademark Nepal Gramudhyog

• Baba Ramdev established Patanjali Ayurved Limited along with Acharya Balkrishna with

the objective of establishing science of Ayurveda

• It imports majority of herbs in India from Himalayas of Nepal

Company Profile:

Patanjali Ayurveda Ltd:

• Head Office: Haridwar

• Operates in India since 1997

• It was founded as a small pharmacy in Haridwar by Yog-Guru Ramdev

• Total Turnover was 5000 crores in the year 2015-2016

• Total employees around 3,00,000 (2014-2015 data)

Revenue Model:

“Future Group has tied up with Patanjali to sell 30 crores worth of Patanjali products every month”

Vision Mission

• To be top Ayurveda Company among

all MNC’s

• To re-introduce the Indian Ayurveda

• To work for the welfare of Humanity

• To reinvent traditional Knowledge of

Yoga and Ayurveda

• To restart the Swadeshi Movement

• To produce good quality products at

cheaper rates

• To introduce Indian Ayurveda to this

modern world

• To attain the highest market share

Source: Company, Edelweiss research

The 3 vital principles that drive Patanjali’s business

Journey from Niche Segment to Full Market Coverage

PAT Trend

Total Income Composition

Value Creation- Patanjali Ayurved LimitedPatanjali has segmented its market based on:• Demographic- Income, age etc• Psychographic- Health Consciousness, Patriotism, Swadeshi etc

Positioning Statement: “Prakriti ka Aashirwad”

Products Offered:

• Patanjali Ayurved produces products in categories of Personal Care and Foods

• The company manufactures 444 products including 45 types of cosmetic products and

30 types of food products

• Patanjali Ayurved has over 300 medicines for treating a range of ailments and body

conditions

• Patanjali has also launched Beauty and Baby Products

• In 2016,Patanjali has announced to enter the Textile manufacturing and produce

traditional Kurta, payjama to western clothes such as jeans.

Patanjali Product Mix:

Some Patanjali Products used in Indian Kitchen

Patanjali Product Mix Key Features:

• The products are differentiated as per the Indian belief in Ayurveda and Natural remedies

• The products are innovative and reasonably priced and possess a wide range of product mix

• Strong R&D department has created new products in quick time and lower costs

• Patanjali Ayurved is extending the product line of toothpaste brand, Danta Kanti, with

variants like medicated, advance and junior

• Power Vita, a health drink made of brahmi is competing with multinational giants like

Mondelez, GSK etc.

• Down Market Stretch diversifying itself from Ayurvedic medicine to FMCG products

Patanjali Ayurved Limited-”The Ultimate Price Warrior”

• Patanjali Products are sold at a price 15-30 %

lower than that of competition

• Pricing Strategy has helped Patanjali establish

itself in marketplace

• HUL( Hindustan Unilever Ltd) has reported the

slowest growth in revenue in the last 6 years

• Colgate, one of the MNC’s worst hit by

Patanjali , has reported worst revenue growth

in 4 years

Patanjali Pricing Key Features – “Penetrative Pricing”:

• The company’s product are priced at 15-30 % discount to competition

• It is able to offer such discounts primarily because of having negligible A&P( Advertising

and Promotion) spend versus other companies

• Other companies have A&P spends ranging from 12-18% as a % of sales

• Another reason for discounts is consumer centric ideology of the organisation and

selling best quality product at attractive price points

• There are even some products which are making losses or have low margins, but it sells

those products to meet consumer needs

Lower and Effective Advertising aids Lower Pricing

• Patanjali Ayurved has limited advertising expenses which helps them in lower pricing

• The company advertises in a limited way – news tickers, regional newspapers, digital

advertising etc.

• Patanjali has adopted the unique “Information based Advertising” like the company

highlights the positives of cow’s ghee, which automatically helps sale of Patanjali Ghee

• In recent past, company’s print advertising has seen a marked increase

Patanjali’s informative Print Advertisements- Kesh Kanti and Ghee

Factor-”Baba Ramdev”

• Baba Ramdev remains the face of Patanjali and its products

• Baba Ramdev, during his yoga sessions , showcases the Patanjali Products

• “Till date close to 70 mn people have come in contact with Baba Ramdev through his

yoga camps and it is believed that this can increase to 200 mn going ahead”

• Being associated with Baba Ramdev, helps in creating a better perception among

consumers that Patanjali products are healthy

Place

• Patanjali Ayurved sells through 5000 franchised stores

• It has 1500 Patanjali Chikitsalayas, 3000 Arogya Kendras, 8000 open stores in villages and

6000 Marketing Vehicles

• It has planned to launch 250 mega stores in tier I & II cities

• Apart from that Patanjali product is also available online through its website

www.patanjaliayurved.net

• The company is also implementing ERP for better mapping of inventory

• It has tie-ups with Reliance and Future group, Star Bazar(Tata Group), More(Aditya Birla

group), Spencer retail, D-mart, Apollo Pharmacy etc.

PAL Distributor Wholesaler Retailers Consumers

3-Level Distribution Channel

Online Platforms to spruce up Distribution Network

Promotion

• Patanjali has picked up nine products from its product portfolio to advertise aggressively

• These are ghee, shampoo, biscuits, noodles, honey, mustard oil, soap, dental cream etc

• The company has set aside 300 crore for advertising spend( 6% of sales)

• It is opting for news channel as the advertising rates are low

• The advertising frequency is high so as to create brand recall

• Its advertisement highlights family values and Indian cultures

• Wrestler Sushil Kumar and Actress Hema Malini are hired to endorse Patanjali products

• Baba Ramdev through his Yoga sessions highlights about the benefits of Patanjali products

• Word of Mouth communication certainly has a higher believability factor compared to

other mediums of advertising

• Patanjali’s informative based advertisement in print and digital media are readily seen

• Patanjali has also embraced digital marketing and has a well design Facebook page and a

twitter account

• Patanjali has its channel on YouTube with more than 200 videos on product information

• Baba Ramdev’s books and VCD’s are also great promotion tools

Patanjali Ayurved Facebook page

Patanjali Ayurved YouTube Channel

Competitors

• Hindustan Unilever Ltd Launched Herbal Brand “Ayush”

• Emami Acquired oil brand Kesh King

• Godrej Consumer Launched neem mosquito coil, hair colour having coconut oil

• Colgate-Palmolive Launched Active Salt Neem toothpaste

• Dabur Dabur Honey & Chawanprash pushed aggressively

• The Himalaya Launched wellness products to provide therapeutic solutions

How Competitors are hitting back the stiff competition

Swot Analysis- Patanjali Ayurved Ltd

Strength

• Natural Herb and organic product• Brand “ Baba Ramdev”• Marketing “ Swadeshi”• Competitive Pricing

Weakness

• Prejudice for Religion association• Less Rural Penetration• Low Exports• Competition with Large MNC’s

Opportunities

• Large Domestic market• Untapped Rural Market• Potential for Exports

Threats

• Political Interference• Rise in Imports• Adaptive competitors like Dabur,

HUL etc

Thank You