Patanjali Ayurved

Limited: Market Entry

Strategy in United
States

United States
International
Marketing
RAJAT
GUPTA
 Company
199
History/Timeline
1 PAL started as7a small pharmacy in
Haridwar

2006 2
Established as a Pvt. Ltd.
company

3 2010
The worlds largest food
park opened

2012
Hit revenues of Rs. 450
cr, 450 stores
4
In 1997, Patanjali Ayurved Limited (PAL) Acharya Balkrishna established Patanjali
started as a small pharmacy in Haridwar, Ayurved Limited as a formal private
by P.P. Swami Ramdev Ji Maharaj company on 13th January 2006 along with
 TIMELINE 2015
5 Hit revenues of Rs. 2,000 Cr., has
4000 stores

2015
Deals signed with 6
Future Group
and DRDO
PRESEN
T
Baba Ramdev does not own any percentage of equity in the company

On 5 January 2010, the worlds largest food park opened 20km from the holy city of
Haridwar, Uttarakhand, India. The INR 500 cr Patanjali Food and Herbal Park is
spread across ~95 acres in first phase; and has generated direct employment for 7,000
people. The construction started in February 2009 and was completed in a record time of
less than a year
 Aug 2015: CLSA came out with a report
4 titled Wish you were listed, Patanjali
FACT
CURRENT SCENARIO Ayurved and summarized the threat it
presented to listed counterparts
S
Food park is now spread over 150
acres Patanjali's revenue > Dabur, Emami,
1 5
Marico, and Godrej Consumer. Ghee is
~85% of products are manufactured by the biggest money spinner for Patanjali,
PAL contributing 30- 35% to its revenue,
in-house and only few products followed by healthcare (20%), and
outsourced. toothpaste Dant Kanti (8 %)
Current Product Portfolio: edible
oils, biscuits, and noodles to PAL has provided more than 2.00
2 toothpaste, hair and skin care products, 6 Lac indirect employment
and groceries
Expansion: cosmetic products, baby
care products, animal feed and dairy
products.

The rise of PAL has been so staggering

3 and well entrenched in consumer psyche
that large Indian and Foreign Research
houses are considering this pretty much
IDE
a Disruption Factor in the overall
 COMPANY ANALYSIS
SEGMENTATION
Demographic basis Age groups from
15-64 Psychographic basis
PLACE Personality, lifestyle and class
PRICE
Value Based Franchise
Pricing Stores,
Alignment of Super/Hyper TARGETING
cost, customers markets
& competitors. 75% of the worlds population uses herbal
0& Online care
02 3marketplace products
65% of Indias rural population uses
PRODUCT
PROMOTIO Ayurveda
All Existing N remedies
Products and Yoga Shivir, Trend shift towards natural herbal
herbal 0 Youtube, products
POSITIONING
4 Social media
products 01 Ayurvedic products are positioned as
Free media
for different products who can treat diseases with
promotions
diseases
.
zero side effects
Juices and food products are portrayed
as a healthy way of life
Ansoff Matrix

EXISTING NEW
PRODUCT PRODUCT
S S
Market
Penetratio Product
n development
- Yoga - Research in
Ayurveda
Shows and herbal
- Spiritual medicines
lessons in PRODUCT LIFE
ashram CYCLE
Market Diversificatio
Development n
- Targeting - Cosmetics
youth and Products like Patanjali Shampoo and
newly health - FMCG health drinks are in growth stage of
conscious products
customers
the life cycle
- Health New diversified products like
Drinks
fertilizers and clothing are in
introductory stage
 MARKET ENTRY STRATEGY MARKETING AND
BRAND BUILDING

04. PARTNERING/JOINT
03. DIRECT EXPORTING
VENTURE
Selling directly into the market
co-marketing
you have chosen using in the first
arrangement to a
instance you own resources
sophisticated strategic
Agents and Distributors become
alliance for manufacturing
the face of the company.
Joint Venture is a 1+1=3
02. LICENSING process
05 . TURNKEY PROJECTS
firm transfers the rights to the
use of a product or service to Environmental consulting,
another firm. architecture, construction
and engineering
01. FRANCHISING
works well for firms that have a 06 .WHOLLY OWNED
repeatable business model (eg. SUBSIDIARY
food outlets) that can be easily set up manufacturing
transferred into other markets. plants in the foreign
country market itself
 EPRG Model:

If we look at the core values of the company and consider the EPRG model of
international marketing,

Patanjali is obviously following the Ethnocentrism route and it cannot leave this path
no matter whichever country it expands its business to. In Nepal as well, the concept is
very much the same with which Patanjali has marketed its products in India.

Costs and benefits of Ethnocentrism:

Environmental analysis for market entry in Nepal

Based on this analysis, environmental analysis for Patanjali for entry in Nepal can be
described through the following table. A score of 3.47 shows Patanjalis rationale for
entering in Nepal country market.

Patanjali is looking for expansion in Nepal and has vowed to invest 100
billion in Nepal in the next decade. Patanjali also has gained goodwill of the
people by establishing Patanjali Yogpeeth Nepal, a charity organization in
Nepal.
Announced its plans to set up a mega Patanjali Herbal and Food Park unit in
Nepal on the lines of the one in Haridwar
 Environment Factors of USA

most developed FMCG US have shown better

sector G S political stability.
tremendous growth and ability of the
Government Political
rise of few FMCH giants government to
Regulations & Stability and
like Walmart formulate and
Barriers to Regulatory
just couple of small implement sound
Entry Quality
Herbal players like policies and regulations

Himalayas and Herbal that permit and
Remedies. promote private sector
development.
Rise in consumer Marke Consumer prices in the
US India Treaty
demands for organic t Size Inflation United States went up 1.6
products and percent year-on-year
Popularity of ayurvedic Growt Inflation Rate in the
products h United States averaged
M I
Huge Indian 3.29 percent from 1914
population with the until 2016, which is a
demand of these good sign for Patanjali to
IDEproducts enter because of
 Outcome of Environment Analysis

Based on above environmental analysis, market entry of Patanjali Ayurveda in US is

determined. Total market entry score is 3.39, which suggests entry would beneficial for
Jaipur Rugs to certain extend
 Proposed Market Entry Strategy: (United
States)
Market Attractiveness
Increased consumption of herbal products
over the years.
Significant population of Indians and south
asians
Relative Competitive position
Resources to Succeed
The key factor will be the product mix,
distribution channels, and the brand equity
a lot if demand for yoga camps by Baba
Ramdev (approx. 6-8 camps per year are
being organized )
How to Enter
start with the export as the strategy for entry
in United States
Exclusive Brand Outlets
Multi Brand outlets
Shop-in Shop
Online Outlets
Product Mix
Product :. Products like Indian spices and
other food condiments and Ayurvedic
medicines can be the initial product
portfolio.
Price: Premium
Promotion: Publicity in events of Baba
Ramdev, promotion activities will be
focused on the large Indian and south
Asian populace
Place/Distribution channel: franchise,
existing supermarkets and existing Mom &
Seven Rules of International
Distribution

5
From the start, maintain control over
marketing strategy

1 Select distributors. Dont let them select you.

6
Make sure distributors provide you with
Look for distributors capable of detailed market and financial
2 developing markets, rather than those
with a few obvious customer contacts
performance data.

Build links among national

7 distributors at the earliest

3
Treat the local distributors as long-term
opportunity
partners, not temporary market-entry
vehicles.

4
Support market entry by committing
money, managers, and proven
marketing ideas
THANKS