It is Nirma vs Wheel again, HUL ready to fight Patanjali

Mumbai . Hindustan Unilever, India’s largest consumer goods company, is launching a raft of Ayurvedic personal care products aimed at the product portfolio of Baba Ramdev-led Patanjali, the surprise successful challenger of the multinational company’s market dominance. The Economic Times reports, “Coming soon in the FMCG space, Behemoth vs Baba, a sequel to Wheel vs Nirma that played out in the 1980s. HUL has taken on a desi challenger in this fashion before. In mid-1980s, Ahmedabad-based Karsanbhai Patel’s Nirma, a detergent brand, toppled HUL’s Surf from the shelves of middle class and lower middle class Indian homes. The Indian unit of the Anglo-Dutch FMCG company rolled out Wheel, a low-priced option. Nirma vs Wheel market battles, as well as the advertising waRs , have entered Indian corporate folklore.
Patanjali has become a Rs 5,000-crore company within a decade. Although still small compared with HUL’s Rs 30,000 crore plus revenue, Baba Ramdev’s company has caught the attention of all fast-moving consumer goods giants. The yoga guru-turned-FMCG player hasn’t been reticent about his ambition. In April this year, he had said Patanjali can beat multinational giants such as Unilever (HUL’s parent), Colgate and Nestle.

HUL, the maker of Lux, Dove and Rin, will launch around 20 products — toothpaste and skin cream to soaps and shampoos — under its existing Ayurveda brand Ayush. Ayush was launched in 2001 as a premium brand but had lost momentum by 2007. Now, the positioning will be mass market — price points between Rs 30 and Rs 130. Given Hindustan Unilever determination to take on Patanjali, and the latter’s aggressive future plans, 2017 may see another classic corporate battle in the FMCG space.

“Ayurveda is a growing trend…,” said Sandeep Kohli, executive director, Personal care, HUL. “Lever Ayush is designed to attract and retain consumers with authentic Ayurveda based offerings.”

Patanjali’s rise has led to otheRs exploring the Ayurveda and herbal products space. L’Oreal launched a hair care range under Garnier Ultra Blends made with “natural ingredients”. Colgate brought Cibaca Vedshakti to the market.

HUL has been reporting tepid volume growth in India, largely due to severe slowdown in rural demand. During its September quarter performance call with analysts, HUL said market conditions have softened in India. Analysts feel Patanjali has a big challenge to meet, too — coming close to HUL’s formidable rural distribution network. HUL has a network of roughly 8 million outlets. Patanjali has a network of 10,000 Aarogya Kendras run by Patanjali Chikitsalaya, apart from selling its products to nearly a million kirana stores.

Link to the original Story : http://economictimes.indiatimes.com/industry/services/retail/coming-soon-a-sequel-of-wheel-vs-nirma-behemoth-vs-baba/articleshow/56227190.cms
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