Letter to BS: Consumers initially tried Patanjali products out of curiosity

Apropos your article “Why Patanjali Ayurveda is faltering” (May 22); Shailesh Dobhal’s analysis of the brand is quite persuasive. I would like to extend it by adding two relevant points.

First, any novelty — in product or promotion — can last only so long. A large number of consumers initially tried various Patanjali products out of curiosity about the new brand. That drove up sales. But as the numbers of the first-time users were bound to diminish over time and as many among them were less than enthusiastic about repeat purchases, sales growth tapered off. The same applies to the promotion campaign, heavily dependent on television, especially Hindi language channels. The appeal of a saffron-clad yogi and the rather preachy messages, with all due respect, is limited and bound to fade.

The second factor concerns the other two Ps. Patanjali depended heavily on supermarkets and its own megastores as outlets. The regular mom-and-pop outlets often display Patanjali point-of-sales publicity materials but have no products to sell, which is seldom the case with other FMCG companies. Patanjali also stoutly insisted on sales only at the printed MRP of the product. Supermarkets routinely offer varying discounts on MRPs of even major brands. Patanjali’s stubbornness on pricing was certain to hit the display space on offer and consequently its sales. Further, in most categories, Patanjali has just one product, unlike the competition. For example, Colgate offers a dozen or more varieties of toothpastes cutting across a wide price spectrum, as opposed to Patanjali’s Dantkanti alone. Colgate gets vastly greater shelf space which translates into much higher sales.

Patanjali was undoubtedly buoyed by its rapid early growth, but its offering demonetisation and Goods and Service Tax as alibis for its far less than expected later growth suggests that it has most likely indulged in fair-weather forecasting.

Shreekant Sambrani  Baroda

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