I recently met the department heads of an Indian Ayurvedic company. While reading up on the sector, I felt that there is tremendous scope for Indian companies if they were to make and sell products on the Ayurvedic / Natural platform. MNC’s just don’t stand a chance in this space as traditional Indians will always value an Indian company’s knowledge and heritage on this front (distribution strength is a separate issue).
However, apart from 2 companies, a lot of Indian companies in the Ayurvedic / Natural space still remain to be small. Here are my thoughts on how to explode growth of these companies.
- Professionalize: Most of these companies are small family run businesses.
- There is urgent need to get people with relevant knowledge to run aspects of business that are alien to the founding family. The founding family can continue to oversee the business.
- The other thing is to quickly sort out the ownership issues that are bound to crop us as the second generation takes over the businesses from the founding fathers.
- De-merge the Pharma and FMCG business: While there is scope for daily consumer products based on Ayurveda, it lends itself strongly to treatment / curative pharma products. Both are tremendous opportunities. However, selling pharma and selling FMCG products need two different game plans altogether (not to mention R&D capabilities). De-merging these will ensure that both of them get adequate and separate focus.
- Get adequate funding: There is only so much one family can put in and there is only so much which a one brand/product company can invest back. It is critical to develop and launch new products at a fast rate to be the first mover.
- Acquire: There are tons of other smaller companies with small and great brands. It takes lots of time and lots of money to build a brand from scratch even to this scale.
- Play the Volume game: While people tend to think that Ayurveda offers a nice niche, value strategy, I believe it is a great volume than a value game. Indians already know a lot about traditional herbs. If the product value proposition is right, given the awareness and availability, they will quickly latch onto the brands.
- Publicize your heritage: One thing that MNCs with super deep pockets cannot claim. You have been playing the game long. You understand the science better than they can. You have the heritage and people trust you.
- Tap into the Diaspora: NRI and PIO’s are nostalgic about anything Indian and traditional and will lap up anything on these lines. Reach them right, there is easy business.
- Don’t use a celebrity endorser: My pet peeve. Celebrities suck up a lot of money and you’ll most often than not tell a sub par story using them. The product is the star and the showcase and not the star.
