INDEX

SR Topic PG
NO. NO.
CH.1 INTRODUCTION
1.1 Introduction
1.2 Research Gap / Statement of Problem
1.3 Objectives of the Study
1.4 Summary
CH.2 RESEARCH METHODOLOGY
2.1 Hypotheses of the study
2.2 Scope of the study
2.3 Significance of the study
2.4 Limitations of the study
2.5 Sample Size
2.6 Data Collection
CH.3 REVIEW OF THE LITERATURE
3.1 Introduction
3.2 Review of Literature
3.3 Gap Analysis

CH.4 DATA COLLECTION AND ANALYSIS

4.1 Data analysis
4.2 Socio- Economic profile of the respondents
4.3 Hypotheses Testing
4.4 Reporting and Interpretation

CH.5 FINDINGS, SUGGESTIONS AND

CONCLUSION
5.1
Summary
5.2
Suggestions
5.3
Conclusions

BIBLIOGRAPHY & WEBLIOGRAPHY

ANNEXURE

CHAPTER – 1
INTRODUCTION
1.1 Introduction to Study
PATANJALI AYURVEDA

Patanjali Ayurved (commonly known as Patanjali) is an Indian multinational consumer

packaged goods company based in Haridwar, India. It was founded
by Ramdev and Balkrishna in 2006. Its office is in Delhi, with manufacturing units and
headquarters in the industrial area of Haridwar. The company manufactures cosmetics,
ayurvedic medicine, and food products.

Patanjali Ayurved Limited was established in 2006 with a thought of rural and urban
development. The company is not merely an organization but a thought of creating a healthy
society through Yog and Ayurved.

Patanjali Ayurved Limited produces quality Herbomineral preparations. To monitor quality,

the Divya Yog Mandir Trust and Patanjali Yog Peeth grow many endangered herbs on its
farmland. The principles of Good Manufacturing Practices (GMP) are rigorously followed in
the plant and Company prides itself on being environment friendly.

Ramdev and Balkrishna established Patanjali Ayurved in 2007. Balkrishna owns 94 percent

of the company, and the remainder is dispersed among other individuals.In May 2021,
Balkrishna had a net worth of US$2.3 billion.

According to CLSA and HSBC, Patanjali was one of the fastest-growing FMCG companies

in India in 2016. It was valued at ₹3,000 crore (equivalent to ₹37 billion or US$490 million
in 2020). Patanjali estimated its annual turnover for the 2016–17 fiscal year at ₹10,216
crore (US$1.4 billion). According to a report by India Infoline (IIFL), at least 13 listed
companies would be affected by Patanjali's success; they included Colgate, Dabur, ITC,
and Godrej Consumer Products.

In a progressive country like India with predominantly dynamic consumer markets driven by
cutthroat
competition and consumers being spoilt for choice, the name “Patanjali” is synonymous with
defining
than that of
a celebrity, has been the endorser of this ubiquitous desi brand “Patanjali.” This billionaire
ascetic yoga
evangelist, the protagonist of this case study, asserts that Patanjali’s new business policy,
“Prosperity for
Charity” with an aim toward charity along with its highly emphasized network marketing and
a hybrid
business model driven by increasing consumer demand, wider reach, unique product range,
and its price
competitiveness coupled with aggressive marketing strategies has resulted in its unexpected
sales figures
which has made its competitors do “kapalbhati.” He states that Patanjali belongs to more than
a billion
Indians, where the entire Indian sub-continent can associate with and the whole world can fit
in the
Indian Ayurveda link through this native Indian brand.
In a progressive country like India with predominantly dynamic consumer markets driven by
cutthroat competition and consumers being spoilt for choice, the name “Patanjali” is
synonymous with defining “Ayurveda” taking the retail plunge.1 Baba Ramdev, who has
been accorded a status not less than that of a celebrity, has been the endorser of this
ubiquitous desi brand “Patanjali.” This billionaire ascetic yoga evangelist, the protagonist of
this case study, asserts that Patanjali’s new business policy, “Prosperity for Charity” with an
aim toward charity along with its highly emphasized network marketing and a hybrid
business model driven by increasing consumer demand, wider reach, unique product range,
and its price competitiveness coupled with aggressive marketing strategies has resulted in its
unexpected sales figures which has made its competitors do “kapalbhati.” He states that
Patanjali belongs to more than a billion Indians, where the entire Indian sub-continent can
associate with and the whole world can fit in the Indian Ayurveda link through this native
Indian brand.

The beginning of the second decade of the new millennium, specifically the later quadrants of
2014 saw “Patanjali” having a unique appeal with most of the Indians who prefer to consume
anything “healthy,” “organic,” or “herbal.” Patanjali Ayurveda Ltd (PAL), still in its infancy
in the fast-moving consumer goods (FMCG) market, has challenged the bigwigs and has
leaped forward to excel as the third major contender by occupying the position of the third-
largest FMCG company in India (Rai, 2015). Baba Ramdev’s cult figure status has made the
brand Patanjali a strong contender in the FMCG sector mainly because of its branded house
marketing strategy. In the toothpaste sector, “Dant Kanti” has created a big cavity for the
existing top players like Colgate and Pepsodent and the same can be attributed in the case of
soaps and detergent powder as well. “Powervita” from the stables of Patanjali has given a
severe jolt to GSK Consumer’s Horlicks, Mondelez’s Bournvita and Heinz’s Complan along
with being a major competitor to domestic bigwigs like Dabur’s Honey and Chyawanprash,
Nestle’s Maggi noodles, Emami’s fairness cream, and a host of competitor products from
Hindustan Unilever Ltd (HUL), Indian Tobacco Company (ITC), and Godrej. March 2016
saw PAL’s revenue grow nearly tenfold to rise up to 758 million USD which got India its
new billionaire, Acharya Balkrishna. He owns 98.5 percent of PAL with an estimated wealth
of 2.5 billion USD. Acharya Balkrishna oversees the research and development division of
PAL (Gupta, Himan, & Ramadoss, 2016).

Patanjali, a relatively young player in the Indian FMCG (Fast Moving Consumer Goods)
sector, has taken the Indian market by storm. Patanjali is a company that produces and sells
Ayurveda (Indian alternative herbal medicine) inspired goods. These include essential
household items such as shampoos, soaps, toothpastes, and several similar items. Latest data
indicates that the company grew by 150 percent from 2015 to 2016. The annual turnover
currently is around US$ 745 million. The company targets to hit a turnover of US$ 1.4 billion
in 2016-2017. The unprecedented growth begs us to question the reasons behind the
company’s success.

Patanjali grew because of three distinct reasons. Firstly, the identity of Patanjali products
resonated with the cultural identity of a large proportion of the Indian population. Secondly,
Patanjali promised high-quality products at a reasonable price. Finally, the aggressive
distribution pattern that the company undertook for its products helped its growth immensely.
The following sections assess the finer details of the three-pronged strategy that is at the heart
of Patanjali’s growth. Next, the article analyzes a few of the roadblocks that the company has
faced in recent months. The final section will assess the key take-away for companies that
plan to enter or are currently operating in India. 

Early Life

Swami Ramdev (born Ram Kisan Yadav in 1965), also known among followers as Baba
Ramdev  is an Indian yoga guru and businessman, primarily known for
popularising Yoga and Ayurveda in India. Ramdev has been organizing and conducting large
yoga camps since 2002, broadcasting his yoga classes on various TV channels. He co-
founded the Patanjali Ayurved Ltd. with his colleague Balkrishna. In 2010, he announced to
form a political party for 2014 General Election. However, he has more recently become a
vocal advocate for the BJP.

Ramdev was born in a Hindu family in 1965 to Ramniwas Yadav and Gulabo Devi at Saiyad
Pur village of Mahendragarh district, Haryana; Both of his parents were farmers.Ramdev
comes from the tradition of Arya Samaj. Ramdev declared net worth of his personal assets at
around "₹1,100 crore" in 2013. The left side of his face was partly paralysed since at least a
few months after his birth, perhaps owing to a congenital disability or a childhood illness.
The condition makes Ramdev's left eye squint and wink involuntarily.

At a young age, he was profoundly affected by Satyarth Prakash, a Hindi book written in
1875 by Maharishi Dayanand Saraswati. Dayanand Saraswati a renowned religious and social
reformer, was the founder of the monotheistic Arya Samaj movement. He rejected being
taught in English with curriculums set under Thomas Babington Macaulay (1800–59), fled
from home and ardently began to study Indian scripture, Yoga and Sanskrit in various
Arsh Gurukuls schools. He preferred Gurukul schools because they were traditional
educational institutes that taught based on Vedic principles. He found Guru Pradyumna, was
accepted into his school, Arsh Gurukul Khanpur, met his life-long associate Balkrishna, and
became Ramkrishna. Here he and Balkrishna spent three years together, developing their
friendship as they studied.

Ramkrishna left to become the student of Acharya Baldevji, an Arya Samaj chief, in Gurukul
Kalwa, who gave him the name Ramdev. He also learnt yoga from Guru Karamvir, also
an Arya Samaji. At around 25 years old, he adopted sannyasa, "took the name Baba Ramdev
and began to teach Yoga." He spent the next three years in the Himalayas, near Gangotri, in
search of moksha. While living in Kalwa Arsh Gurukul in Jind district, Haryana, Ramdev
offered free yoga training to villagers. Then he moved to Haridwar in Uttarakhand, where he
practised self-discipline and meditation, and spent several years studying ancient Indian
scriptures at Gurukul Kangri Vishwavidyalaya.

Towards the end of the 1990s, farming conditions in his native village worsened, due to the
region's depleting water table, which prompted Ramdev's move to Haridwar. Subsequently,
he called his family to Haridwar. Ramdev's family members have played different roles in his
ayurveda ventures depending on their capabilities. His father oversees activities in Patanjali
ayurved, his brother Rambharat controls the company's finances.
Balkrishna (known as Acharya Balkrishna, born 4 August 1972) is an
Indian billionaire businessman and chairman of the consumer goods company Patanjali
Ayurved. He was reported by Forbes to have a net worth of US$2.3 billion as of
May 2021. According to Ashish Kumar of Arya Samaj, Balkrishna has successfully
established and managed a global business without a formal education.

In 1996, Balkrishna and Ramdev founded Divya Yoga Mandir Trust in Haridwar, and in

2006, they founded Patanjali Ayurved,[8] a fast-moving consumer goods (FMCG) company
involved in the manufacturing and trading of FMCG, herbal, and ayurvedic products.[9]
[10]
 Followers of Ramdev, NRIs Sunita and Sarwan Poddar, helped kick-start the business
with a loan. According to Balkrishna, he had taken out a ₹50–600 million loan at a time
when he had never held a personal bank account in his name.[11] In 2012, the company posted
a turnover of ₹4.5 billion (US$60 million) which by 2015–2016 had risen to ₹50
billion (US$660 million).[12] Patanjali Ayurved's revenue from operations increased
marginally to ₹9,022.71 crore in the year up to 31 March 2020, Revenue stood at about
₹8,522.68 crore in FY19.

While Ramdev does not hold a stake in Patanjali Ayurved, he is the face of the firm and
endorses its products to his followers across his yoga camps and television programmes.
[12]
 Balkrishna owns 94% of the company and serves as its managing director.[14][5] He is a
close aide of Ramdev.[15] Acharya Balkrishna listed in India's 50 most influential personalities
2020.[16] He was reported India's third-youngest billionaire by Forbes India Rich List 2020.

PATANJALI AYURVEDA LIMITED, a Company registered under the Company’s Act,

1956 having its Registered Office at D-26, Pushpanjali, Bijwasan Enclave, New Delhi –
110061 and Works: 1. Unit-I at:D-38, Industrial Area, Haridwar, Uttarakhand; 2.Unit-II
at :YOGPEETH, Maharishi Dayanand Gram, Delhi Highway, Haridwar; and 3.Unit-III:Vill-
Padartha, Haridwar, Uttarakhand, India.
The Company was originally formed as a Private Limited Company on 13th January, 2006
and subsequently converted into Public Limited Company on 25th June, 2007. Presently, the
Board of Directors of the Company is managed by Sri Acharya BAL KRISHNAJI as its
Managing Director and Swami Muktanandji and Sri Ajay Kumar Arya, are the Directors of
the Company.

Marketing strategies by PatanjaliAyurved Ltd

 Industry sources indicate that Patanjali’s market share is likely to be around 5% by end
2015. This is a big success in this category, which had just three players until now. (Credit
Suisse).

Patanjali likely to more than double its revenue to Rs 5,000 crore in FY16 from Rs 2000
crore in FY15. (Reliance securities) Sales and Distribution

PatanjaliAyurved sells through nearly 4000 retail outlets as of 2015.Patanjali also sells its
products online and is planning to open outlets at railway stations and airports. Patanjali
Ayurveda has tied up with Pittie Group and Kishore Biyani's Future Group on 9 October
2015. As per the tie-up with Future Group, all the consumer products of Patanjali will be
available for the direct sale in Future Group outlets.

Patanjali Ayurveda products are also available in modern trade stores including Reliance
retail, hyper city and Star Bazaar apart from online channels. Defense organization DRDO
entered into licensing agreements with Patanjali Ayurveda for transfer of technology.

The Memorandum and Articles of Association of the Company : To manufacture,

process, refine, formulate, import, export and deal in all kinds of Ayurvedic and herbal
Products, Life Savings Drugs etc. apart from so many other related objects. The concept for
forming this Company was to “link the rising destiny of millions of rural masses on the one
hand and many more suffering and leading unhealthy urban life style on the other”.
The View of the Respected Swami Ramdevji, the renowned YOGA GURU and Sri Acharya
Balkrishnaji, made the concept into writing through formation of the Company
“PATANJALI AYURVEDA LIMITED”. PATANJALI AYURVEDA Ltd is a company that
functions like all other companies under the Rules and Regulations of the Company Law
Affairs and several other Laws applicable for these type of Industries.

At micro level the challenge is no less tough. Along with PRANAYAM, the wisdom of our
ancient sages, the organic food products and herbal medicines churned out of this unit, trying
to undertake the threats to fight out the dreaded and deadly diseases like CANCER and
AIDS. Claim for having found a lasting cure for many other relatively more excessive but
equally tormenting diseases like Diabetes, Arthritis and Thyroid is already entrenched with
thousands of patients cured with fulfillment.

Superior quality of our products at a fair price is not the only concern that we have. Getting
our patients rid of their diseases is again too limited a goal for us to seek. A holistic approach
to improve the quality of life of all beings, world over, is the purpose behind our being.

Getting eliminate the food we consume of the pollutants in the form of poisonous pesticides
and chemical fertilizers that our farmers use, is a goal that we strive to accomplish by
providing our people the eatables that are cultivated in organic and natural manures and pest
repellents.

The bringing of Ayurvedic medicines along with Pranayama, Asnaas, pure food and natural
drinks is a package perhaps the world was waiting for long, for the two saints in the form of
SWAMI RAMDEVJI and ACHARYA BALKRISHNAJI.

Patanjali Ayurveda Limited :

PAL, an Indian FMCG company, is a business miracle of sorts with a mission to make India
an ideal place for the growth and development of Ayurveda and anything natural for the rest
of the world. It was started by Baba Ramdev and Acharya Balkrishna as a small pharmacy in
Haridwar in 1997. In 2006, PAL was established as a private limited company and
subsequently converted into a public limited company in 2007, with an objective of
establishing the science of Ayurveda in accordance and coordination with the latest
technology and ancient wisdom. It is a registered company under the Company’s Act, 1956,
having its registered office in New Delhi and its headquarters and manufacturing units
located in Haridwar, Uttarakhand . The idea behind the birth of PAL was to “link the rising
destiny of millions of rural masses on the one hand and many more suffering and leading
unhealthy urban life style on the other” indicating that the company was determined to
manufacture products that benefit mankind, which in the process was acknowledged by the
consumers globally making it a leading manufacturer of Indian-made consumer goods. Every
day, some 300 trucks roll out of a 150-acre manufacturing complex on the outskirts of
Haridwar, one of India’s holiest cities. This is the biggest plant of PAL, which supplies
roughly 60 percent of its output which includes a huge number of cartons of juices and herbal
candies, toothpastes and soaps, flour and spices, and an assortment of herbal medicines which
are very popular within the country as well as across the borders in curing apparently all
types of illnesses like headaches, arthritis, asthma, and high LDL cholesterol (Maheshwari,
2016).

Smart pricing –

Patanjali products are cheaper than its peers in the same category. As per the Acharya
Balkrishna the input costs is too low because they directly source raw material from the
farmers and middlemen are not entertained, and the brand have its own face to promoting
brand, so cost for the brand ambassador is negligible as well salaries are also modest. Since
the production and promotion cost isless than the other companies are spending, it
directlylessens the product cost. But there are some categories where people may not buy his
suggestions and may not switch to Patanjali, if people don‟t find a satisfactory reason. For
such categories Yoga guru has put the price card but not all Patanjali products are cheap but
most have 10-20% lesser cost than its rival products.

Cultural Mass Appeal –

The products that Patanjali produces are marketed as historically and culturally indigenous
products. Patanjali has captured the imagination of the Indian consumer by posturing itself as
a brand that is extremely Indian. The difference in the branding has become more apparent as
other FMCG companies have tried to sell their products as modern and sophisticated, created
through innovative technology.

One notices that the Indian market still has a penchant for culturally rooted products. In
addition, Patanjali also advertises its products as being all-natural, meaning they do not have
any synthetic ingredients. The lesson for players entering the Indian market is simple.
Though Indian consumers have become more in-sync with the latest trends and preferences
that are gripping global markets, at the same time, they reflect strong preference for
traditional goods. Companies entering the Indian market should note that Indian consumers
often behave in an extremely idiosyncratic manner, which sets the Indian market apart.
Companies should ideally perform their due diligence in India through tools such as market-
entry and market-expansion studies. These will create a sound foundation to their own
strategies to becoming successful in India.

Awareness strategy through Social Media –

Now a days the digital world like Facebook, Twitter, Instagram, blogs and web pages are
more effective and prompt to promote and advertise the product. The same product awareness
strategy has been adopted by the brand Patanjali to spread the awareness about the Patanjali
products to educate and to engage people through the social media over the world. Even
Yogaguru has more than 7.4 million likes on Facebook and 623 thousands of followers on
twitter as of November 2016. [5] Where he interacts with the followers on Twitter and
Facebook by organizing live chats and also informed them about new camps, events, product
announcement. Retail outlets

Trust and Faith –

Previously, we used to get all the products only in PatanjaliAyurvedicstores located in rare
cities, now you can get them from every town today even though you can buy Patanjali
products in Big Bazaar as well. If you ever visit to a Patanjali retail outlet, you would not
only find herbal medicines but also licensed AyurvedicDoctor for a free and expertise
consultation. This trust and faith are the major reasons why people feel connected to
Patanjali. Variety of products –The major step towards success is its variety of products in
each and every segment, brand Patanjali is not only focusing on medicinal products but also
focusing on herbal products of personal care, grocery, nutrition and supplements, home care
etc.

Taking Control :

In India, trust and faith still form an engaging proposition than science and logic which made
the path easier for Baba Ramdev to seize the opportunity with the slogan “Prakriti ka
Ashirwad.” This young brand with a focus on “Swadeshi” positioning and underlining their
products with phrases “natural and pure” went past the eight-decade old brand Colgate by
reporting a revenue of around 750 million USD for the last financial year (ibid., p. 3). The
“Satvic” brand endorser has been working diligently toward bringing in a revolutionary
change in the FMCG markets by employing branding and marketing strategies which
foretells that PAL will overtake the established decades-old brands like Nestle and Proctor &
Gamble by doubling its revenues to 1.5 billion USD and will slowly inch its way toward the
second position next only to Unilever in India. PAL epitomizes all natural products which are
synonymous with Ayurveda and Indian values and has a wide variety of products in the much
sought after categories like food, cosmetics, and ayurvedic medicinal preparations. This
Indian native brand can be aptly termed as a disruptor (Somvanshi, 2016) in the Indian
FMCG scenario which can be attributed to their vision that states that their dedication,
scientific approach, astute planning, and realism are all geared up to serve people by bringing
the blessings of nature through Yoga and Ayurveda into their lives. According to Forbes
(Forbes, 2016), Patanjali has been depicted as India’s Body Shop which has taken over the
markets with a storm, posing a real threat to the existing market leaders like Colgate,
Unilever, Nestle, and GlaxoSmithKline. PAL had made a huge landfall in FMCG sector and
many other lines of food products along with beverages, healthcare and medicines, personal
care products, and cleaning agents. For any FMCG company, advertising and promotions
typically account for 12–20 percent of revenue expenditure, but this was significantly taken
care of by Baba Ramdev’s branded house strategy. During the introduction stage, PAL
followed a unique word-of-mouth publicity model, and the brand loyalty of its customers
proved successful for the company which eventually helped them save on marketing and
advertising costs as well. The growth of Patanjali (see Table 1) to register a profit of more
than 27.9 million USD, which is nearly a 103 percent raise from the previous value, between
2012–2013 and 2013–2014 is beyond expectations. The business model of this brand has
brought in a tectonic shift in the FMCG sector and puts forth revenue targets that are four
times their last reported sales. These growth trends deserve to be applauded for breaking in to
the heavily guarded bastions of FMCG which can be solely attributed to the towering brand
image of Yoga Guru Baba Ramdev (Youth Ki Awaaz, 2016). He embraced every available
opportunity to engage the customers who were more concerned with healthy living and in the
process built an empire comparable to some of the prominent mid-sized FMCG companies in
India that brought Patanjali close to the ranks of FMCG companies like Emami and Marico.

Unique Outreach

Yog Guru baba ramdev has enormously single handed has shaken the Indian market with
patanjali ayurved. His teachings and philosophy plus the marketing strategy are working
wonders. He started off as an yoga expert and became a business tycoon in recent years with
Patanjali his grand idea to promote swadeshi and herbal products which are safe for mankind.

The swadeshi agenda has worked well for the Yog guru as he is able to invade such areas
where other brands were nowhere to be found. He targeted the heavily populated rural belt
which acquires the major consumption of patanjali products and provided them a pocket
friendly, natural solution for their household.

Patanjali has made its mark and is striving to achieve the better revenue in the country. It can
be found on the shelves of reliance fresh, Hypercity and in the corner of a small grocery shop
in a village. Patanjali products are 20-30% cheaper than other products because of supply
chain strategy and they are getting raw materials directlyfrom the farmers.Patanjali has
ventured with online e-commerce also to attract the young users in today's digital world.
Patanjali stands to gain through its approach and justifying the theme of “Prakriti ka
Aashirwad”.

Patanjali’s Research and Development

Patanjali Ayurved Ltd. has its own Research Institute. Before the laboratory was set up, the
work of clinical control in the field of Ayurveda could not take place ever at a large scale,
which is why this knowledge could not get global recognition. As a result, they have set up
Patanjali Research Institute where they have initially spent Rs. 100 crore rupees and a big
chunk of it is being spent on research works.
There is an intense process of research. Any medicine is first tested in the laboratory, then
used on rats and rabbits and after their successful use of animals, it is used on humans. These
types of processes make the scientific facts of Ayurveda clear, and generate, a new hope for
those patients who have given up after long allopath treatment.

About Patanjali – Ayurved Products

Patanjali Ayurved Ltd. is the fastest growing FMCG company in India that only deals with
herbal products. Founded in 2006 by Acharya Balkrishna and yoga guru Baba Ramdev. It’s
headquarter is located in Haridwar. In the year 2019, it earned revenue worth $ 1.2 billion. 

Patanjali’s digital marketing strategy revolved around connecting modern India with its
culture and heritage of medicine, Ayurved. Patanjali undoubtedly had a range of products
under its brand, but being a new evolving brand it had a good number of competitors.\

While looking at the business side of the organisation, it caters to the personal care and food
industries. It produces more than 2,500 products and manufacturers over 300 ayurved
medicines for the treatment of various body ailments. 

One of the major reasons for its success is its products being 10%-30% lower in cost than
other FMCG products. The second reason for its success could be the shift in Indian
consumers’ lifestyle towards natural and ayurvedic products. 

India is one of the biggest developing business sector with an aggregate populace over one
billion. After post-progression the nearness of MNC indicating extraordinary rivalry among
organizations for their item. They are accompanying new items to pull in clients. In such a
ferocious rivalry period organizations are accompanying separated and imaginative items to
pick up piece of the overall industry. Around 73 percent of the populace lives in rustic
territory while rest 28 percent in urban agglomerations. Since the real Indian populace lives
in provincial zone so there is a need to supplant conventional urban system with imaginative
country methodology. The present paper endeavor to talk about the part of creative promoting
and marketing strategies in the market and it's effect on clients.
Multinational enterprises (MNEs) are increasing their presence in the lives of more and more
consumers as companies seek to expand and promote their products to a still wider range of
markets globally. As markets change and develop, so does the strategy used to enter them,
and companies must be able to choose the correct way to enter markets in order to remain
competitive.

FMCG items are those item which have short life expectancy which are utilized for brief time
and are supplanted inside days, week, and month or inside a year. Since FMCG items are
supplanted quickly so they are having high market request. They work at a lower edge.

A noteworthy bit of month to month spending plan distributed on these items. The business
are continually stretching out and growing new item to improve buyer's involvement. Real
players in FMCG enterprises are HUL, ITC, Nestle India, Dabur and P&G.

The major FMCG fragments are-close to home care, sustenance and drink, family care,
tobacco and oral care. Nourishment fragment is the main portion in FMCG part. Taste and
inclination of clients are changing quickly so the organizations are embracing creative
process because of mechanical improvement to match current clients necessity so there is a
gigantic open doors in the area. Additionally we try to gain an understanding of why any
discrepancies exist and whether they can be explained by the nature of emerging markets as
well as the characteristics of the FMCG industry.

PATANJALI’S BUSINESS SIZE & REACH IN INDIAN MARKET

PAL has achieved a tremendous presence around the globe and throughout India in a very
small time since its inception in 2006. They have more than 47,000 retail counters, 3,500
distributors, multiple warehouses in 18 states and proposed factories in 6 states.

Sales channel partners of Patanjali includes Pittie Group and Kishore Biyani’s Future Group.
Patanjali’s Ayurveda products are now also available in modern hyper stores like Reliance
Retail, Hyper City, Star Bazaar and other popular online stores. Defence organisation
‘Defence Research and Development Organisation’ entered into licensing agreement with
PAL for transfer of technology.

Business strategies and competitiveness of Patanjali

Patanjali Ayurved has been successful in its strategy of umbrella branding, hits and misses
approach in product offerings, and fulfilling the demand from its loyal customers through a
centralized facility in Haridwar. Nevertheless, the company needs to identify its weaknesses
in order to confront the forthcoming competition and challenges. Therefore, to analyze the
strengths and weaknesses of Patanjali, its business model, strategies, and marketing mix have
been investigated in this section.

Overview of Patanjali Ayuurved limited

Overview Patanjali Ayurved Limited is an Indian FMCG Company headquartered at

Haridwar, Uttarakhand. The Company was established on 13th January, 2006 with Acharya
Balkrishna as its majority state holder as well as managing Director with 92% stake, the rest
being with an NRI family from UK.

Product Portfolio. It is involved in manufacturing as well as distribution of products ranging

from food, beverages to cosmetics and fabric care. Since its inception in 2006 the company
has made rapid advances in expanding its reach across many segments and currently operates
a plethora of brands. Its many products include.

It was incorporated as a private limited company in 2006 with the objective of integrating the
latest technology and ancient Ayurveda wisdom. Soon, the venture was converted into a
public limited company in 2007 to facilitate its speedy expansion. Though the firm initially
focused on Ayurveda medicine (now sold under its Divya brand), soon it started
manufacturing, selling and distributing mainstream FMCG products. The organization
became debt free in FY3 2015 and has achieved its ambitious target to twofold its sales by
earning Rs 105.61 billion in FY2016-174 from Rs 50 billion in FY2016-15 (as shown in Fig.
1). Patanjali now offers products in over 50 categories (Bloomberg/Quint 2017), among
which toothpaste, hair oil, and soap are the top contributors to its revenue.

The financial performance of the company is expected to get stronger with recent contracts
with the states of Uttar Pradesh and Uttarakhand. While Patanjali’s Rs 7 billion contract with
Uttar Pradesh involves supply of midday meals to the government schools, its exclusive
contract with Uttarakhand entails growing expensive Ayurveda plants in the state. In regards
to Uttarakhand, the state plans to open a single-window clearance (a single-window
facilitation mechanism for investors) for the purchase and sale of Ayurveda products, where
the prices for both will be fixed by Patanjali (News Bytes 2017).

Patanjali currently has its central manufacturing unit in Uttarakhand along with multiple
warehouses in eighteen states of India; it also plans to set up more factories in six other states
of the country (Patanjali Ayurved, 2017d). The company has claimed that about 55% of
urban households use its Ayurveda.

Production :

Patanjali Food and Herbal Park at Haridwar is the main production facility operated by
PatanjaliAyurved. The company plans to establish further units in India and in Nepal. In
2016, the Patanjali Food and Herbal Park was given a full-time security cover of 35 armed
Central Industrial Security Force (CISF) commandos. The park will be the eighth private
institute in India to be guarded by CISF paramilitary forces. Baba Ramdev is himself a "Z"
category protectee of central paramilitary forces.

Products :

PatanjaliAyurved produces products in the categories of personal care and food. The
company manufactures 444 products including 45 types of cosmetic products and 30 types of
food products. According to Patanjali, all the products manufactured by Patanjali are made
from Ayurveda and natural components Patanjali has also launched beauty and baby
products. PatanjaliAyurvedic manufacturing division has over 300 medicines for treating a
range of ailments and body conditions, from common cold to chronic paralysis.

Patanjali launched instant noodles on 15 November 2015. Food Safety and Standards
Authority of India slapped a notice on the company as neither Patanjali nor Aayush, which
are the two brand names under which Patanjali got licenses, have got any approval for
manufacturing instant noodles.

In 2016, Patanjali has announced to enter the textile manufacturing centre. The company is
reported to manufacture not only traditional clothes such as KurtaPayjama but also popular
western clothes such as jeans.

On November 5, 2016, Patanjali announced that it will set up a new manufacturing plant
Patanjali Herbal and Mega Food Park in Balipara, Assam by investing ₹1,200 crore (US$180
million) with the manufacturing capacity of 1,000,000 tonnes (2.2×109 lb) of goods per year.
The new plant will be the largest facility of Patanjali in India and will be operational by
March 2017. Patanjali already has around 50 manufacturing units across.

Patanjali Ayurved Limited, the fastest growing FMCG Company in the country is a mineral
and herbal products company established in 2006 and headquartered in the industrial areas of
Haridwar. The products offered by the company are in the personal care and foods segments
including baby care and beauty products.

Currently it has around 450 different kinds of products and it also manufactures over 300
medicines for the treatment of a range of body ailments. The company claims that all its
products are made from natural components and Ayurveda. Patanjali’s Dant Kanti, Ghee,
Kesh Kanti, herbal bath soap and honey are some of the its best-selling products which have
propelled the growth of this company. Patanjali’s noodles were an attempt to promote a more
healthy eating habit in the kids of the country.

The reasons for the success of the company are two folds; one is the shift in the lifestyle of
the Indian customers towards using more natural and Ayurvedic products, the second reason
is that the Patanjali products are significantly less expensive than other personal care and
food products in the market. This has made a significant proportion of Indian middle class to
move towards Patanjali.

 Manufactures over 300 medicines for the treatment of body ailments

 Has a growth rate of 130%
 The turnover of the company grew by more than 150% in FY16 compared to FY14
 47,000 retail counters
 3,500 distributors and warehouses in 18 states

The Patanjali Ayurveda basically produces the product in the personal care and food in which
the company produces more than 2,500 products including 30 types of food products and 45
types of cosmetic products and all those products manufactured by Patanjali being made from
natural and Ayurvedic components. The Manufacturing unit of Patanjali Ayurveda has over
300 medicines for treating people’s cold with a motive of providing pure and better-quality
products to the consumers. The Baba Ramdev’s tremendous impact on “Yoga and
Pranayama” has basically targeted the huge masses Worldwide. Thus, Usage of Spiritual
competitive technique basically helped to sell the products with zero investment being done
in advertising media.

The Middle-class people were quite benefited with the usage of Patanjali Products as the
product cheap pricing as compare to other brand products the quality and quantity of the
Patanjali products was quiet maintained with the series of FMCG Products which includes
ghee, juices, soap, Dantkanti paste, oils etc. With proper providence of these products
satisfied the needs and demand of the people to the fullest.

The Marketing Strategy developed by PAL products is quite different from other MNC’s
such as it basically focuses more on content marketing. Thus, Baba Ramdev’s concept of
educating the people regarding the usage of Herbal and natural products its advantages and
effect tremendously fascinated people to buy they’re with ease and people started demanding
herbal products.

Named after the Indian sage Patanjali, Patanjali Yogpeeth (PYP) is Swami Ramdev’s
flagship project and one of the largest yoga institutions in India. Its purpose is to practice,
research, and develop yoga as The word yoga is derived from the Sanskrit root ‘yuj,’
meaning to join or unite. The beginnings of yoga were developed by the Indus-Sarasvati
civilization in Northern India over 5000 years ago but some researchers think that yoga may
be up to 10,000 years old. The classical period (between 500 B. C. and 800 A.D.) is defined
by Patanjali’s Yoga-Sutras, the first systematic presentation of yoga. During the late 1800s
and early 1900s, yoga masters began to travel to the west, attracting attention and followers.
Subsequently, the practice of yoga has blossomed as a part of healthy lifestyle.

In addition to Patanjali Ayurvedic hospital and yoga and Ayurveda research center, the non
profit institute contains facilities such as ashram (residential facilities for the disciples in
return of donations), dharamshala (low cost residential facilities for the needy), and langar
(free food arrangements for the poor) and has developed international trusts in the UK, the
USA, Canada, Nepal, and Mauritius (Diva Yoga 2017a). Moreover, it has also established the
University of Patanjali, with the vision of innovating an integral education system with
scientific knowledge and ancient wisdom, alongside Patanjali Ayurved College to develop
human resource as skilled Ayurveda physicians. The founder, Ramdev, rose to national fame
through yoga programs on Sanskar and Aastha TV channels, in 2001 and 2003, respectively;
currently, viewers in India and across the globe are able to watch him on six different
channels. Thus, when the yoga guru turned into a business tycoon and founded Patanjali
Ayurved, he became the brand ambassador that shaped the perceptions of the company and
established the brand image. Evidently, Patanjali had a large number of consumers from the
start as the fans, followers, and disciples of Ramdev were willing to purchase its products.
Patanjali, the contemporary example of a disruptive organization in the Indian FMCG sector,
has altered the entire FMCG space and risen as a strong contender to the leading brands, both
global and homegrown. The objective of the case study is to analyze its business model,
expansion strategies, competitiveness and marketing mix to identify why and how Patanjali
has grown to a FMCG giant within just a decade, and which areas of the company needs
emphasis in order to improve its performance in the backdrop of opportunities and
challenges.

The term Ayurveda combines two Sanskrit words: ayur, which means life, and veda, which
means science or knowledge; so, Ayurveda means the science of life. Ayurveda or Ayurveda
medicine is a system of medicine with historical roots in the Indian subcontinent, and India is
one of the most popular countries when it comes to herbal medicine. A study shows that
around 20,000 medicinal plant species have been recorded and more than 500 traditional
communities use about 800 plant species for curing different diseases in the country (Kamboj
2000). Another study indicates that approximately 80% of Indian population uses herbal
medicine (Gogtay et al. 2002). The popularity of herbal medicine in Western countries has
increased and, consequently, these remedies are now available from South Asian markets,
Ayurveda practitioners, health food stores, and on the internet.

Place

Patanjali has reached 47,000 retail counters, acquired a network of over 3500 distributors,
and established 258 Mega Marts in India (Patanjali Ayurved 2017d). To further expand its
reach, the company has signed a marketing partnership with Future Group, by which
Patanjali products are offered in Big Bazar stores across 250 cities of the country. It also has
modern trade tie up with Reliance Retail, Hypercity and Star Bazaar. Now consumers can
order their products through e-commerce sites and apps like Amazon, Big Basket and
Grofers. According to an industry estimate, Patanjali products are available in 0.2 million
traditional retail outlets, called the Kirana shops. In India, HUL is the market leader of the
Kirana universe with 6 million outlets, followed by Dabur, Colgate-Palmolive, and Nestle
with 5.3, 4.7, and 3.5 million outlets, respectively. While the large firms pay 19–20% margin
to modern retailers and 12–15% to kirana shops, Patanjali pays 12.5 and 8–9%, respectively
(The Economic Times ).

Price

According to Patanjali, its success comes from consistently focusing on price and quality, i.e.,
it offers competitively priced products to the consumers. For instance, the company claims to
contain more pulps in its juice products at a lesser price as it sells at a discount of about 14–
16% compared to Real by Dabur and Tropicana by Pepsi. Nonetheless, the pricing strategy of
the company varies depending on the product category, as shown in Table 3. For ghee, it
enjoys a certain premium pricing with respect to other national players, and in case of honey,
it follows predatory pricing.

Smart pricing –

Patanjali products are cheaper than its peers in the same category. As per the Acharya
Balkrishna the input costs is too low because they directly source raw material from the
farmers and middlemen are not entertained, and the brand have its own face to promoting
brand, so cost for the brand ambassador is negligible as well salaries are also modest. Since
the production and promotion cost isless than the other companies are spending, it
directlylessens the product cost. But there are some categories where people may not buy his
suggestions and may not switch to Patanjali, if people don‟t find a satisfactory reason. For
such categories Yoga guru has put the price card but not all Patanjali products are cheap but
most have 10-20% lesser cost than its rival products.

Awareness strategy through Social Media –

Now a days the digital world like Facebook, Twitter, Instagram, blogs and web pages are
more effective and prompt to promote and advertise the product. The same product awareness
strategy has been adopted by the brand Patanjali to spread the awareness about the Patanjali
products to educate and to engage people through the social media over the world. Even
Yogaguru has more than 7.4 million likes on Facebook and 623 thousands of followers on
twitter as of November 2016. [5] Where he interacts with the followers on Twitter and
Facebook by organizing live chats and also informed them about new camps, events, product
announcement.

Retail outlets Trust and Faith –

Previously, we used to get all the products only in PatanjaliAyurvedicstores located in rare
cities, now you can get them from every town today even though you can buy Patanjali
products in Big Bazaar as well. If you ever visit to a Patanjali retail outlet, you would not
only find herbal medicines but also licensed AyurvedicDoctor for a free and expertise
consultation. This trust and faith are the major reasons why people feel connected to
Patanjali. Variety of products –The major step towards success is its variety of products in
each and every segment, brand Patanjali is not only focusing on medicinal products but also
focusing on herbal products of personal care, grocery, nutrition and supplements, home care
etc.

Smart pricing –

Patanjali products are cheaper than its peers in the same category. As per the Acharya
Balkrishna the input costs is too low because they directly source raw material from the
farmers and middlemen are not entertained, and the brand have its own face to promoting
brand, so cost for the brand ambassador is negligible as well salaries are also modest. Since
the production and promotion cost isless than the other companies are spending, it
directlylessens the product cost. But there are some categories where people may not buy his
suggestions and may not switch to Patanjali, if people don‟t find a satisfactory reason. For
such categories Yoga guru has put the price card but not all Patanjali products are cheap but
most have 10-20% lesser cost than its rival products. [4] Awareness strategy through Social
Media – Now a days the digital world like Facebook, Twitter, Instagram, blogs and web
pages are more effective and prompt to promote and advertise the product. The same product
awareness strategy has been adopted by the brand Patanjali to spread the awareness about the
Patanjali products to educate and to engage people through the social media over the world.
Even Yogaguru has more than 7.4 million likes on Facebook and 623 thousands of followers
on twitter as of November 2016. [5] Where he interacts with the followers on Twitter and
Facebook by organizing live chats and also informed them about new camps, events, product
announcement. Retail outlets Trust and Faith – Previously, we used to get all the products
only in PatanjaliAyurvedicstores located in rare cities, now you can get them from every
town today even though you can buy Patanjali products in Big Bazaar as well. If you ever
visit to a Patanjali retail outlet, you would not only find herbal medicines but also licensed
AyurvedicDoctor for a free and expertise consultation. This trust and faith are the major
reasons why people feel connected to Patanjali.

Variety of products –

The major step towards success is its variety of products in each and every segment, brand
Patanjali is not only focusing on medicinal products but also focusing on herbal products of
personal care, grocery, nutrition and supplements, home care etc.

Strategic Outline for Patanjali Ayurveda Limited

The PAL is financially well placed, and the company was started with an investment of ¹400
million, which was initiated by Baba Ramdev from his yoga camps, television shows on
private channels, and donations. A minimal advertising budget which included few
commercials and with the employees acting as volunteers in brand promotion aided in cutting
down on the advertising and promotion expenditure. All these attributed to the fact that the
company was void of any financial burden.

The FMCG companies in India have been following the traditional distribution strategy
followed since ages, and the modern retailers were not ready to sell Patanjali’s products,
forcing them to look at an alternative model of distribution (Singh & Gopal, 2017). Thus,
came in to being Patanjali’s unique distribution strategy which was a blend of the successful
Ayurveda chains like Arya Vaidya Shala and Kottakal and the multinational’s multi-level
marketing (MLM) networks like Amway, Tupperware, to name a few, along with co-opting
the Indian entrepreneurial mind set. The types of retail formats that were employed to sell
Patanjali products included Patanjali Chikitsalayas which were basically clinics with
ayurvedic doctors available for consultation, Patanjali Arogya Kendras which are health and
wellness centers, and Swadeshi Kendra, non-medicine outlets. These include Patanjali
Chikitsalaya, which are clinics along with doctors, Patanjali Arogya Kendra, which are health
and wellness centers, and Swadeshi Kendra, non-medicine outlets.

In recent days, PAL has built its own mega stores or exclusive outlets which typically
measures around 1,500 square feet in size and the group has 15,000 exclusive outlets across
India. The robustness of the brand was further demonstrated by its unique strategy of selling
its products through their own stores, general retail stores, traditional mom-and-pop stores in
every nook and corner of India followed by a premeditated partnership with the leading
retailer of India, Future Group, which over time helped the brand in achieving deep market
penetration and gaining a substantial appeal from the urban rural consumer.

Baba Ramdev’s scathing remarks and bold campaigns to boycott products like shampoos,
soaps, colas, and so on manufactured by multinational companies by showing their ill effects
along with the word-of-mouth advertising by its loyal consumers paved way for
strengthening its brand identity and brand promise. This when coupled with the pricing
strategy adopted by the brand confirmed the value proposition specially designed for the
price-sensitive Indian consumer and in the process proved to be a great trendsetter in the
FMCG sector by gaining a huge mind and pocket share.

Patanjali Business Model

Patanjali’s consumers mostly came from its great Yoga and Patanjali Ayurveda network.
Patanjali Yog Samiti has 1Lakh branches and 5 lakh teachers.

There are 10,000 Patanjali Chikitshalya and Arogya Kendras.

The people who come to their yoga camps are ready to market to the company. Added to that
all kind of Swadeshi branding of Baba Ramdev.

Its integrated mega-facilities is Haridwar, their firm churned out as much as its customers
demand.

Patanjali Into Swadeshi Pitch.

After pramotic swadeshi to consumers Baba Ramdev building a business empire by targeted
traders community on the swadeshi plank.

You saw in its ad in social and print media, Patanjali Ayurved is appealing to shopkeepers “to
give prominence to Patanjali product on shelves” because it “will help in fulfilling the dream
of Mahatma Gandhi to promote Swadeshi”.

“The country needs Swadeshi Products; now we are telling shopkeepers to help in this
movement.

Ultimately, Swadeshi product should reach the consumer,” Patanjali spokesperson SK

Tijarawala said.

Baba Ramdev followed the same strategy with organised retailers such as the Future Group,
Reliance Retail and Shoppers’ Stop-promoted HyperCITY.

While Reliance Retail has created ‘Patanjali Destinations’ at its out.

Speaking at a Conclave, Patanjali CEO, Acharya Balkrishna questioned why the food
processing sector in India was not generating enough revenue.

He went on to city figure from Thailand, Which indicated that India’s all food processing is
only 6 % to Thailand’s 30%.

Low Pricing and Cost dynamics

Patanjali products are made available at an exclusive discount as compared to their

companies. The company’s raw material comes directly from farmers.

It has lower marketing spends and overhead cost compared to its peer and as such can
produce at a much cheaper price.

A large proportion of the India population, especially the middle class, is extremely price-
sensitive and looks for quality products at a reasonable price.
Patanjali has understood and developed a strategy to take advantages of the aforesaid mindset
capturing market share from share established players.

Best sales and distribution methods:

Patanjali’s combination of low prices,’ natural and pure’ proposition and ‘swadeshi’
positioning are widely acknowledged to be the reasons behind success, what is not that well
known is the critical role played by Patanjali’s path-breaking sales and Patanjali distribution
strategy in driving this exceptional growth trajectory.

A perfect Strategy for sales and distribution of patanjali was a key factor behind Patanjali’s
meteoric Growth. Patanjali’s low-cost distribution system was remarkably efficient in getting
the acceptance of its products against far heftier rivals.

The company doubled its sales and distribution of patanjali targets each year and set its sights
on total domination over the Indian consumers. It developed a piece of hunger for new
distributors and new channels for trade.

The Concept of Extendable Core and Patanjali Ayurveda Limited

The aspect of Patanjali’s business model allows it to maintain its performance advantage as it
scales the market for more market space. The brand Patanjali spans across various product
lines like Shuddhi, a cow urine-based floor cleaning solution to personal care, human and
cattle food, spices, ayurvedic medicines, yoga CDs, branded apparels, and other lifestyle
categories, indicating a very low “product mix consistency” (Bhasin, 2017b). Also, these
brand extensions are not linked to Ayurveda which may at one point of time result in critical
issues of maintaining consistent quality as PAL has to rely on contract manufacturers and in
the process this brand extension may impact its core brand promise
PAL’s expansion into inconsistent product categories with a view to increase the product line
depth may end up confusing the consumers. If a particular category performance drops for
some reason, it has all the probability of impacting the sales volumes of key categories as
their integrated marketing communication strategy mainly revolves around their parent brand
name Patanjali, indicating a lack of focus on key sub-brands (ibid., p. 8). The euphoria that
had set in the market, when Ayurveda started becoming the main segment of FMCG markets
and brand Patanjali started commanding the segment was given a cold foot treatment when
the government of India proposed a goods and services tax of 12 percent as against the
existing tax incidence of 8–9 percent on all ayurvedic preparations (Bhushan, 2017). This
move was very disheartening to all the major FMCG players because it arises an important
issue of price affordability among consumers.

The brand “Patanjali” has been endorsed largely by Baba Ramdev and Acharya Balkrishna to
a certain extent, and any issue that blemishes their integrity may have an adverse effect on the
brand’s performance as Patanjali has adopted an image-driven branding strategy.

Patanjali’s conceptual framework is developed purely on competitive dynamics along five

basic dimensions like aim of competition, mode of competing, product portfolio, plan of
action, and customer interaction from the perspective of time. This in the process compelled
for a broader conceptualization of competition that has been interpreted in the context of the
brand evaluation by the customer which involves their cognitive process that is used to attach
certain aspects of positivity or negativity to a brand. In other words, there have also been
noticeable occurrences of cognitive processing and affective behavior in terms of affection
and emotional association with the brand which fosters brand loyalty. The brand attributes,
such as creating quality image, the products being sourced naturally, being purely herbal, and
the portrayal of the brand as totally ayurvedic in nature along with suitable pricing strategies,
have acted as an important competition criterion in the FMCG sector.

As a result, the existing FMCG companies directly affected by Patanjali such as HUL, Dabur,
Emami, and Himalaya have reinforced their portfolios by ramping up all their herbal product
portfolios and making their products more relevant to consumers. The brands like Colgate
and Dabur indeed felt threatened by Patanjali’s aggressiveness in the market, and the bigger
brands like HUL and Emami went on an acquisition spree and acquired brands like Indulekha
and Kesh King, respectively, while Himalaya opted for aggressive marketing strategies. Baba
Ramdev made PAL a force to reckon with in the Indian FMCG sector by partnering with
“Future Group,” which ushered in a new trend, creating a strong swadeshi cult in the Indian
FMCG market which focused on herbal-based soaps, shampoos, and food products, to name a
few. This indicates that Patanjali, even though a disruptor brand, has just opted for a market
expansion rather than replacing or acting as a substitute for the existing legacy brands. In
other words, it has created or rather streamlined the market for ayurvedic products, which
until its arrival had not been given much attention either by the consumers or the existing
brands and the market.

Second, it was not clear if Patanjali has expanded the market or acted as a substitute for
legacy brands. While the former falls under the ambit of market creation, the latter could be
the shift of consumer loyalty from existing brands and thereby, unraveling the latent
consumer dissatisfaction.

The grocery category also saw a change like organically grown rice, wheat, pulses, and
brown sugar on the retail shelves which was not observed before. Patanjali tackled the
aggressive branding strategies of its competitors by consistently advertising and spreading
word-of-mouth messages that brand Patanjali products are totally ayurvedic/herbal, naturally
sourced, and safe to consume without any side effects or allergies. The brand endorsements,
product promotions, word-of-mouth messaging, and advertising strategies were carried out in
a very simple and natural way that people easily accepted, making the company save on their
investments in traditional advertising channels. This was adequately supported by an
excellent distribution network system.

1.2 Research gap / Statement of problem

Baba Ramdev sensed the Indian consumers’ temperament toward price sensitivity and their
penchant for culturally rooted products. To cater to this, he developed a unique model for
PAL which embraced unique branding and affordable pricing attributes that shaped its end-
to-end business strategy (Bhasin, 2017). The ayurveda division of Patanjali is the star
performer with products like Desi Ghee, Dant Kanti toothpaste, Kesh Kanti shampoo, herbal
bath soap and Patanjali Honey being the star performers for the brand. Patanjali ghee is the
largest selling product of the company. Patanjali claims that its shampoo has a 15 percent
market share, toothpaste 14 percent, face wash 15 percent, dishwash 35 percent, and honey
50 percent. The snapshot of the marketing mix of PAL seems to be very unique, and it may
be detailed as the promise of delivering a product with the use of genuine and natural
ingredients in sufficient quantities. The outcome results in a brand experience which
convinces the consumer of the authenticity and goodness of the product indicating that the
promise is delivered. The price is 15–30 percent lower than the competitor brands. The use of
alternate media (online), word-of-mouth publicity, Baba Ramdev himself acting as a public
relations officer, yoga events, and real time digital marketing, and the use of multiple
distribution channels helped to build the brand. The product portfolio of PAL includes
nutrition and supplements, grocery and staples, ready food, beverages, personal care,
healthcare, household-related products, and so on.

The flagship products of Patanjali like honey, toothpaste, and noodles, to name a few, have
already forced competitors to bring their prices down in order to save their presence in the
market. Ghee made from cow’s milk is their cash cow and the market reports say that more
than US$300 million of the US$751 million approximately valued top line comes from this
single product (ibid., p. 3). It is here that the shrewd marketing strategies of PAL come into
play, and the product is in fact sold at a premium to the other organized sector players.

THE FACTORS RESPONSIBLE FOR THE GROWTH AND THE DEMANT

INCLINATION OF PATANJALI PRODUCTS

Patanjali outperformed in merely half of a decade andbecame a Brand, demant for the
Patanjali products inclined enormously. The success of brand Patanjali happened due to these
factors – Opportunist Strategy (Struck the hammer when the iron was red hot) – In a recent
case we seen that Patanjali had skimmed the Opportunity and launched their new product
Patanjali Atta Noodles when the biggest competitor of leading brand Maggie, was not in the
game. It is a lesson to keep your hammer ready for the favorable conditions.

Built a strong fan base and the followers trust – Before Patanjali came into the picture and
before launching the full-fledged marketing campaign, a large number of people were trusted
him and following Baba Ramdev and the idea that yoga was solutions to many problems.

To counter attack Patanjali Dominance in Herbal Category, Colgate launched Cibaca

Vedshakti herbal toothpaste and many more products like Active salt, Active salt neem,
Sensitive Clove etc.
They also brought down the prices of their products and providing promotions in the top end
multifunction toothpaste segment. Colgate  India is spending aggressively on advertising. As
per the Market report, Colgate India spent about 12% of its revenue on marketing compared
to 9% globally.

In December 2015, Unilever acquired Indulekha Brand for INR 330 crore to step up its
presence in the new and emerging categories. They relaunched Ayush Brand with a wide
range of products including toothpaste, soap, handwash, shampoo and face wash in five
South Indian States.

The company’s growth has come at a price. The ability to grow and produce various products
has helped the company to increase revenue exponentially. However, a number of products
produced by the company have recently come under regulatory scanners.

The Food Safety and Standards Authority of India (FSSAI) issued a notice to the company
for misleading advertisements. In addition, Patanjali faces legal risks from competitors. The
Solvent Extractors’ Association of India (SEA), a body of edible oil producers, claims that
Patanjali’s product advertising is faulty and derogatory. The competitors also approached the
Advertising Standards Council of India (ASCI) for relief when Patanjali created the
misleading advertisement and subsequently refused to withdraw the advert.

In addition, there have been allegations against the company of selling a few products
without proper licenses. They have also frequently been in the limelight in recent months for
hiring casual labor for testing their products. This hiring had not been supported by proper
paperwork. The pitfalls highlight the issues that a company might face, when they experience
unfettered growth in a market such as India. The growth often casts a veil over the flaws in
the operating procedures of the company. Companies planning to operate in India need to
recognize the importance of regulatory compliance. The regulatory agencies have become
stricter and often impose fines and curtail business operations in the event of violations by
companies. In such scenarios, companies should always tread very cautiously in the
regulatory landscape that India offers.
1.3 Summary

Patanjali's vision is to provide herbal/ayurvedic/natural solutions to all the problems and in

this pursuit it is also elevating the livelihoods of local farmers. It has leveraged the emotional
route by bringing in the 'Swadeshi' angle to market its products.

A yoga guru Baba Ramdev started an association Patanjali Ayurved in 2007. The main aim of
the company is to bring awareness among Indian people towards swadeshi (made in India
from materials that have also been produced in India) products. Also the profits earn by the
company will be either cultivate back or profits will be used for social welfare. The firm, to
increase its sales, also provides its products at reduce rate. Patanjali also believed that it will
be very beneficial for consumer to shift in their preferences towards herbal and ayurvedic
products which are deemed to be healthy and also closure to nature. It has also placed itself as
a swadeshi brand, which has a request among a class of consumers.

The growing demand for organic products and rising health concerns have caused individuals
to prefer detergents, soap and hand wash without any added chemicals. Future estimates
indicate the growth in this category, however, it has been forecasted that toiletries will
contribute 3% to Patanjali’s overall revenue. Hair oil and Patanjali’s shampoo are expected to
boost the revenues generated from the hair care segment and is projected to contribute 8% to
Patanjali’s overall revenue. Majority of revenue generated by the hair care segment comes
from the northern region of the country. The rising demand for herbal and organic products
will see an augmenting demand for Patanjali’s toothpaste in the future, especially from the
rural market and this is expected to boost revenues. Patanjali will manufacture and sell new
lines of body lotion and face wash, targeting men and children will help further boost the
contribution of the body care segment to Patanjali’s overall revenue. Products like Patanjali
Moisturizer Cream, Patanjali Multani Mitti Face Pack, Patanjali Aloe Vera Juice, Patanjali
Yoga Sutra, Patanjali Coconut Hair Wash, Patanjali Sheetal oil, Patanjali Sunscreen, Patanjali
Aloe Vera apricot Face Scrub, Patanjali Anti-wrinkle Cream, and Patanjali Drishti Eye drop
are gaining huge popularity.