How Patanjali uses modern brand strategy to grow past Colgate and challenge P&G, Unilever
The news must have come through to you too: Patanjali reported Indian revenues of around Rs. 5,000 crores (~ USD 750 million) for the last financial year – and in doing so went past Colgate in India. Even more interesting is that Colgate is almost 8 decades old in India while Baba Ramdev’s brand is barely 8 years old.
The saffron-clad Baba’s forecast was quite eye-catching too – he thinks the brand will double revenues to Rs. 10,000 crores (~USD 1.5 billion) in India by next year, 2017 – which would effectively take them past two other-decades old companies – Nestle and Procter & Gamble – and leave Patanjali second only to Unilever in India, all in just about 10 years.
So what helped them grow this fast? After all, nobody particularly thought that the Indian FMCG scene was ripe for disruption.
Sure, there will be many parts to this answer. Quality products, or at least the promise of these will be one reason. Reasonable pricing will be another. Aggressive distribution will be a third.
But I believe the true innovation is something that was probably done without much thought.
A single brand strategy.
The Colgate company sells brands under its name, Palmolive, Ajax and others.
Procter and Gamble go further – there’s Gillette, Tide, Pampers, Ariel, Duracell and so much more.
Unilever is the classic proponent of the multi-brand strategy: from Surf and Dove and Lipton and Lux and Ponds to variants like Surf Excel and Lipton Yellow Label and Lux Supreme and Ponds Dreamflower and far, far beyond.
But take a look at the Patanjali range above – whether it’s toothpaste or rice, noodles or chyavanprash – it’s all under one brand, Patanjali.
Flying in the face of traditional brand theory.
Traditional marketing thought has held that one needs to build and nurture a portfolio of brands, each carefully positioned against a separate audience for a separate need.
Perhaps Baba Ramdev wasn’t the first to cock a snook at this dictum. Richard Branson was one of the first to get there, with his “Virgin” brand draped around everything from colas to planes, trains, mobile services and comics.
The thinking is straightforward – if you have heard of my brand and like the personality – then you might be comfortable buying something else I offer. No matter how different the product category.
The modern technology brand playbook.
Technology brands like Google, Microsoft, Yahoo and others follow this playbook.
The naming formula here is simple: Unique Brand + Generic Sub-brand/category name = Product Brand name.
Google and Maps makes for Google Maps. Ditto for Google Search. Or even balloons in the sky – Google Loon.
The word ‘Microsoft’ is a prefix that fits everything from Mouse and Keyboard to Windows Server.
Apple’s generic sub-brands are almost category like: Apple iPod, Apple iPhone, Apple iTunes, Apple iPad and so on.
So what Baba Ramdev is doing is not very different from the new thinking in the business world.