MAM
Innovation and pioneering helped Marico grow: Harsh Mariwala
MUMBAI: Harsh Mariwala transformed his family's trading business in spices and edible oils into Rs 7,300-crore FMCG giant Marico, led by flagship brands such as Saffola and Parachute which sell in 25 countries. The company recently launched Saffola FITTIFY, a range of healthy soups and shakes. Mariwala's other businesses include Kaya, a chain of skin care clinics.
The company also scouts for young Indian entrepreneurs and facilitates the start-up ecosystem through the mentoring platform Ascent Foundation.
Mariwala is someone who walks the talk and lives by example – a catalyst of positive change, said Raj Nayak during a tete-a-tete with the affable Marico founder.
“We started in phases, earlier the name of the company was Bombay Oil Industries. It's an edible oil business where we were selling coconut oil, refined oils to trade as well as some industries. That business was not doing too well, lots of businesses depend on how well you cover your raw material or how the raw material prices behaved, so it was very erratic in terms of margin and performance,” shared Mariwala.
So he thought of converting the oils business from unbranded to branded in order to make it more profitable and sustainable, a bold move which paid off. And that’s how it all started. He started travelling to internal markets, appointed distributors, talent managers, advertising agencies in the interiors of Maharashtra and Gujarat. The consumer product is highly de-licensed, which helped Mariwala to gain profit. Apart from licensing, one clear no for him was entering the high-tech business.
Mariwala mentioned that while his iconic Parachute brand was a success, it was mainly selling in 50 litre tins. Initially, the retailers would buy it and sell it in bottles which were later purchased by consumers. Back then, the market of packed coconut oil was much smaller than what it is today. Later, the idea struck him to create a packaged product which was sold in various parts of Maharashtra. Mariwala’s initial foray was to scale up the existing business across India.
Another well-known brand, Saffola was neglected for a very long period of time, he revealed. After starting the business, his focus was to identify further opportunities. He added, “I wanted to be in the number one position, to be a market leader, as it helps you to get more margin. We grew by innovating in the coconut oil market, during that time the whole market worked on tin containers, then we converted it to plastic. It was not an easy journey; it was a tough conversion. However, it ensured that our growth rate jumped up multiple times. We applied the same innovation in Bangladesh, and now we are the leading coconut player in the Bangladesh market.”
Another key innovation was the lice-killing hair product Mediker, a must-have in Indian households with young kids.
“We acquired Mediker from Proctor & Gamble and introduced it in oil format, the sales just doubled. So, innovation and pioneering helped us to grow,” the business tycoon remarked.
Relating an interesting anecdote behind how the Revive detergent was launched in the early ‘90s and creating a market for a product where none existed, Mariwala said, “We came up with our product Revive out of a personal necessity. I liked crisp clothes, that is how we made Revive which helps to starch clothes without any hassles.”
According to him, for any product, there must be a consumer need which is big enough to build a brand. Moreover, to become a market leader, advertising is very important and once a certain mass is created, one can go back to devising effective cost structures and improving margins.
Everybody still wonders, from where the name Parachute emerged. Mariwala jokingly said that is the question that the nation wants to know. He shared that Bombay Oil Industries was formed in 1947, shortly after the second World War when a lot of Indians got to know about parachutes – and that’s how Mariwala’s uncle thought of creating a brand by this name, which is now a huge success.
On the subject of world wars, Mariwala opined that there is an ongoing war for talent, and one has to treat hiring like marketing. “When there is a shortage of good talent, you have to market yourself first,” he quipped. “That means you have to identify what is unique about you, you arrive at what we call employee value proposition, which is unique in the job market. In our case, unlike big MNC corporations where decisions are taken in closed headquarters, we empower our employees.”
Spoken like an entrepreneur who knows how to make a difference.
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