Patanjali Ayurveda is known as one of the fastest company to reach the 10000 crore revenue mark in product sales, major FMCG firms like took years and even decades to reach this mark. Patanjali has its presence in almost every category of FMCG today. Their exponential growth story was the talk of the town until March 2018 when they faltered from their promise of doubling their revenue figures of 2017 in the year 2018.
There are many reasons which might be the cause of the stunted revenue, I think the major ones are:
1) Entry of other FMCG majors in the Ayurveda category of products : Unilever has revived its erstwhile ayurveda products brand Lever Ayush, Colgate Palmolive has started making new ayurvedic variants of their toothpaste and Dabur is also planning to roll out new products in the segment. HUL has shown good growth figures after this and colgate has also started regaining its market share.
2) FSSAI inquiry for post-dating products and products under scanner of Food Regulators: Many consumers have alleged that patanjali products which had a manufacturing date of April 2018 were found on shelves during March also Nepal's food regulator has banned 4 of their products from entering their market. This has lead to negative publicity given the fact that patanjali entered the market banking on the crackdown on Maggi.
3) Excessive Diversification: Patanjali has actually launched a lot of products in a lot of categories, though diversification may be the key to success for many firms but the focus on quality has actually gone down due to the production of lot of cheap products. Patanjali is also launching its own "Swadeshi Sim Card" in partnership with BSNL this is actually something very diverse from their current portfolio of products also given the highly competitive nature of the telecom industry I am highly skeptical about it's future.
I would also call Patanjali more of an opportunist than a disruptor given the fact that is entered the market at a time when the government was in favour of promoting ayurvedic products and also it's marketing campaign targeting Maggi ban and promising a healthier more nutritious offering lead to its entry in the market. Maggi lost market share at that time but has regained it. Unilever might make a comeback in a similar way and get hold on its market again.
Patanjali should focus more on improving existing products rather than keep on diversifying, also as a brand built on the principles of Ayurveda it should focus only on products which have ayurvedic ingredients, recently i have even seen patanjali toothbrushes being sold an that nowhere fits into the ayurvedic segment, similarly the sim cards are not related to what Patanjali is all about.
Comments
Post a Comment