Importance of Community Marketing: Case study research paper from

Patanjali Ayurved Limited in India

Debashish Sakunia
School of Electrical Engineering, KIIT UNIVERSITY,
Bhubaneswar, Odisha
Pin Code: 751 024
Email id: debashishsakunia@gmail.com

Ruchi Jha
School of Computer Science and Engineering, KIIT UNIVERSITY,
Bhubaneswar, Odisha
Pin Code: 751 024
Email id:ruchijha139@gmail.com

Abstract
This research paper is based on a market case study which discusses the marketing techniques by
Patanjali Ayurved Ltd (PAL), one of the leading FMCG company in India. Patanjali promoted by
yoga guru, Baba Ramdev has seen a tremendous growth rate of the company, in a time less than a
decade, due to its unique marketing strategies. It discusses the growing interests of the consumer for
the 'swadeshi', herbal and organic products

Keywords: Community marketing, MNC, Ayurveda, yoga

1.Introduction

1.1. The Power Of Community In Marketing

Management advice from experts tends to be shaped by economic cycles. On the upswing, it
is about capitalizing the emerging trends and technologies while on the downswing, it is
about finding ways to economize that would not upset consumers and hoard resources for
future recovery.

Marketing is often maligned as a discipline whose results cannot be measured and it is

particularly vulnerable to the management mood swings. These days, marketers are advised
to ride out the recession by reverting to 15-second ads, repurposing old creative and
refocusing their attention on wealthy and hedonistic segments.

There is a better way to rethink marketing in a downturn. It is not about shrinking the way to
growth; fundamentally, we all know that does not work. It is about reframing the challenges
to find new opportunities and looking with fresh eyes at the needs of people around us. It is
about finding resources to pursue new growth by letting go of what is no longer valued by the
people we serve. It is about tapping into old, proven values that both resonate today and
support reinvention of a better tomorrow. It is about rethinking marketing through the lens of
community.

1.2. The case for community-centric marketing is compelling:

1.2.1. Less Community Costs

Many of worlds strongest brands such as Nike, Starbucks, Google initially scaled through
low-cost community-based marketing. When companies prioritize on meeting the needs of
the people they serve, they do not have to spend much to attract new customers. Moreover,
when they stay close to their communities, they do not need much market research to tell
what people want.

Kiehls, for example, is a provider of premium body care products mostly used by models
and the elite. People from around the world make visits to the original New York City store.
A renowned global brand, presently owned by LOreal, Kiehls packaging is plain; its stores
are basic, and from its foundation since 1851 to today, the brand has never advertised. Their
success is realized by-products tailored to customers needs, word-of-mouth promotion, free
in-store product trials and the personal connections forged by active community involvement
by every employee.

1.2.2. Community Loyalty Growth

Human beings equal wants, chief among those is belongingness and feeling understood.
These needs are met by families, clubs, and communities. When companies begin to focus on
building closer communities, it forges emotional bonds. Once a new community is
established, people who earlier felt left out now filled with kindred spirits- they experience
belongingness. When an existing community is strengthened, segments which earlier felt
marginalized now find validation- they discover their importance in the community.

Nike, for example, has done an amazing job by connecting with under-appreciated consumer
fragments and fostering communities that build empowerment- from making running
mainstream, to supporting inner-city basketball or to empowering girls as athletes. The
reward has been intense customer loyalty.

1.2.3. Community Maintains Bonafides

Brands from community remain relevant because they constantly adapt to the changing
needs, values, and interests of the people from the community, who give them meaning.

Starbucks, for example, originally served aficionados a theater of coffee experience, with
each variance carefully engineered. As newcomers joined the race, baristas were trained to
educate them on coffee exotica to develop a dimension of easy experience for the brand.
When technology caused a convergence between work and home life, Starbucks became the
third place escape, by adding refuge to the brand mosaic.

Amidst rapid growth and diversification, Starbucks responded by tapping the larger cultural
trend of consumption based on self-expression to offer an endlessly configurable array of
unique toppings, ingredients and preparation techniques inspired by customer requests and
baristas creativity. While Starbucks has stumbled of late, it is telling that upon his return to
reinvent the company; CEO Howard SchultzHoward Schultz quickly reached out to the
community by establishing mystarbucksidea.com.

1.2.4. Community Drives Innovation

Theres no better source of innovation and growth than a passionate brand based on a
community.

Harley-Davidson, for example, understood that its customer segment shared a core passion
for its brand, but they also have a wide variety of unfulfilled challenges and needs. By
methodically focusing on meeting the challenges, the company built strong new businesses
around motorcycle customization, riding gear, motorcycle driven fashion, and home decor. It
also leads to the creation of the largest motorcycle club in the world, motorcycle rentals and
training businesses, shopping, a museum and travel services, and even customized cafs.

1.2.5. Community Marketing: process and result weights even

Community Marketing is neither an event done for communities nor an activation within a
community. Community Marketing does not buy consumers; rather it meets their needs in a
context best for the brand and consumers to engage and interact. Community Marketing is an
amalgam of interaction, nurturing, communication, networking, fusion, collaboration, and
assimilation of vision. These processes are critical in the beginning when the company
approaches communities under a common ground. There are no shortcuts or standard
operating procedure that can apply to all. Most think it to be about building relationships and
let social media amplify engagement around it. Anthropology, sociology & cross-cultural
sciences are knowledge one must utilize to manage the dynamics of community marketing.
Regardless of the scale of the project, the process of identification, nurturing, interaction, and
cultivation are all critical for proper implementation of community marketing.

2. Background

2.1.Patanjali Ayurved Limited ( PAL )

Yoga guru-turned-tycoon Baba Ramdev has set the bar higher for his FMCG business 1
trillion ($14.9 billion) in net sales, a target which he thinks can be achieved in 10 years, if not
in five.

The bearded yoga guru in his 50s has no doubt that Patanjali Ayurved Ltd, which he set up in
2006, will get there; it is just a matter of time.

The target is to reach a 20-fold increase from the 5,000 crores in net sales that Patanjali
posted in the business year ending on 31 March. Next stop: 10,000 crore in net sales in the
next business year to next March.

The breadth of Baba Ramdevs ambition can be gauged by the fact that Hindustan Unilever
Ltd (HUL), the Indian unit of Anglo-Dutch consumer products giant Unilever Plc., which has
been in India since 1888, has not even reached one-third of Ramdevs target. In the year to 31
March, HUL posted net sales of 32,482.72 crore.

The target accounts for a third of the size of Indias entire packaged consumer products
market at present, estimated at about 3.2 trillion a year and projected to grow at a rate of 12-
15% annually over the next five years to reach 6.1 trillion by 2019, as put in a report by
industry lobby Federation of Indian Chambers of Commerce and Industry (FICCI) and
KPMG.

Of course, Patanjali is used to the pace of growth. The company, which sells everything from
toothpaste and shampoo to noodles and biscuits, and wheat and rice to ghee and honey, more
than doubled its sales in the year ended 31 March, from 2,006 crore in the previous year.
(To put it in perspective, HULs sales rose by 4% in the same period.)

2.1.1. Business is a byproduct.'

Ramdev downplays his role in building PAL into an emerging consumer product
manufacturer giant, saying his role is that of the brand ambassador who works without fee in
television commercials representing the brands his company makes.

The rise of PAL may be backed by the faith that Baba Ramdevs millions of disciples repose
in their yoga guru, who, in 2011, briefly became a campaigner against government
corruption. However, there is also something beyond reliance on faith. PAL knows where
exactly it is headed and what it should do to get there.

2.1.2. Advertising, MNC style

Patanjalis expansion was backed by a high-powered marketing campaign led by Baba

Ramdev himself. Between January and March, PAL doubled the number of advertisements it
aired on TV channels.

PALs television ad insertions jumped 102% from 11,897 in the first week of January to
24,050 by 25 March, according to BARC. Ad insertions by Patanjali were 20% more than
those by the next biggest brand on TVCadbury, a well-renowned chocolate brand in India.

Patanjali was riding on Ramdevs huge fan following. The company got two things right
one, the full India-Ayurveda connection and, second, the MNC style of advertising.

Baba Ramdev's Channel, Aastha, is a handy marketing tool as well.

2.2 South Asia

South Asia is one of the worlds fastest and largest growing market, yet unknown. It is the
largest economy. India is soon to becoming a Tiger (The Economist: On India becoming
Tiger).Its growth is all the more impressive because half of the times the subcontinent suffers
from growth-retarding factors such as corruption, conflicts, poverty, low on resources and
natural calamities. It includes eight countries Afghanistan, Bangladesh, Bhutan, India,
Maldives, Nepal, Pakistan, and Sri Lanka. All of the South Asian countries have rapidly
grown the population that leads to great market competition, the strain on lands and low
resources. Pakistan has the next largest economy($250 billion) and the 5th highest GDP per
capita in the region, followed by Bangladesh and then by Sri Lanka.For the next stage of
development for the subcontinent, they are the perhaps the most important factors in market
integration, institutions, infrastructure, inclusive growth, and local goods. After seeing the
continuous growth, the question arises- Will South Asia can emerge to top most market in the
coming future as compared to East Asia? Will it able to sustain and enhance the market
growth rate. A deeper insight suggests that they are many things to be done for the
accelerated growth.

The FMCG sale in India is driven by the rear motors that are controllable and uncontrollable
factors which include the macroeconomics factors such as GDP, employment growth and
inflation. Controllable factors include market growth that is distribution and advertising.
Urbanization and globalization have promoted India to endless choices they ever had.
However, due to increased rate of exports which implies increased trade & dependence
between nations has exposed India to the effects regarding economic slowdowns. Indias
FMCG soon to hit backwoods (Orrisa, Jharkhand, Bihar, MP, and Chhattisgarh) as they the
potential for the future growth of their market. Some of the top vogues of these states are
urbanization, the new rural, increased affluence; growth is here to persist.

3. Yoga and Ayurveda Love

Yoga has been an important part of Indian ethos for over 5,000 years now. It refers to a body
with philosophy and spiritual practice of which the physical movements, the asanas or poses,
constitute only a small part.

PM Modi's effort to rebrand yoga as Indian is not aimed at restricting Americans the right to
teach whatever they think yoga to be, but rather to remind them that they owe their regimen
they love to India and Hinduism.

Things come and go with trends, but yoga has survived for centuries and is even today
picking up momentum in the world, people young or old are stressed like never before
and now look up to yoga for the cure.

Also, the reason for its growing practice and popularity is the large scale transmission of
education: as the activity of the intellectual ones becomes stronger, more people will shift to
yoga over a period, and it will become a popular way to seek wellbeing.

Yoga master, Swami Ramdev, isn't dull. Clad from head to foot in carrot coloured robes, his
early morning national television broadcast pulls in 20 million viewers in India itself, and
then there are the usual video and summer camp spin-offs, and the unusual ones, like yoga
cruises.

Swami Ramdev's contribution to yoga in India has been tremendous. Baba Ramdev is a
popular figure who has helped thousands of people with major and minor ailments through
yoga. He had simplified yoga and made it available to the masses through television.
Through a daily telecast on tv, he has taught millions the yoga exercises and helped them live
a healthier and happier life style.
 He took the initiative to introduce them to the forgotten science of yoga. His medicines and
yoga practices are found to be very effective against physical, emotional, and mental
disorders.

Ayurveda as a medical system knew its time was coming. Unfortunately, Ayurveda has often
been presented in a reductive way as yoga, which was only one aspect of a more
cosmological theory.

Ayurveda became a brand extension to the spirituality industry where major gurus like Sri
Ravi Shankar popularized it but as the extension of their spirituality.

When one looks at an art of living shop, one realizes Ayurveda is only part of its spiritual
offerings.

Several companies in India manufacture Ayurvedic medicines, but most of those

manufacturers are small which includes numerous neighbourhood pharmacies compounding
ingredients to make own remedies

4. Swadeshi vs. Videshi

Videsh mania is nothing new for India. Indians always took pride in having a daughter
getting married to an NRI or flaunting an item procured overseas or having a son abroad.
Also, the same country practiced Be Indian, Buy Indian philosophy and Swadeshi
movement. The movement was successful and even years later India continued to follow a
restrictive policy because of which foreign companies were not as interested in investing in
India. However, the year 1991 changed it all. Due to economic reforms and free-market
policies, the Indian Government opened doors to foreign investors, as a result of which today,
there are more than 4000 Multi National Companies making tons of money by making
products using our resources.

Consumers buying psychic and habits have changed. 'Sasta aur Tikao' (cheap & best)
propaganda used to sell is not practiced these days/ it is more about what sells the best and
what attracts the most irrespective of the price tag.

5. Conclusion
Patanjali has built unique approach marketing by setting up a community before product
launch. PAL was always bound to meet new competition. A good start might ben't enough for
them.

Baba Ramdev understood this fact that without a solid foundation, they will always have
trouble creating brand value. From building a strong community force to bringing back
Swadeshi moment to the country; it looks like he took all the right decision.

Marketing was a tricky area to handle for the new Swadeshi Company. However, in India,
Trust and Faith are way importance than science and logic, which made it easier for Baba
Ramdev. Though PAL believes in the traditional way of lifestyle, it follows the modern way
of marketing which is the unlike any of Indian company.

Community marketing is an essential tool in conjunction with social media. Modern

consumers expect more than a one-sided relationship with their products and services. They
anticipate a customer service base available to answer their questions and concerns. By
implementing a community marketing strategy, organizations can give them the same.
Community marketing bridges the distance between brands and customers, ensuring more
loyal customers and a better overall reputation.

In tough specially, people crave for a sense of community support. When companies and
organizations provide this, they deliver tangible and emotional value. With employees and
customers working for hands in hand to solve collective challenges, they build long-lasting
bonds of loyalty and create new sources of growth. Good marketing puts people at the centre,
while smart marketing taps the collective power of community.

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