Baba Ramdev is well known for taking up new challenges head-on. He allegedly defeated paralysis by practicing Yoga, popularized the dying Vedic Indian tradition throughout the world, took on black money and looks after India’s most trusted Fast Moving Consumer Goods (FMCG) company Patanjali Ayurveda. Now his company aims to be a conglomerate showing interest in industries like cloth manufacturing, horticulture and telecommunication.
Baba Ramdev is an astute businessman and a master strategist when it comes to brand building. He assessed it very well that top Indian FMCG companies are foreign origin multinationals, and then used the plank of Swadeshi to build brand loyalty among customers. The Indian FMCG sector is known to be the most competitive with multinationals like ITC, Hindustan Unilever Limited and old homegrown Dabur, Britania, Parle etc but Patanjali Ayurveda now has a strong presence in the FMCG sector within a decade. Patanjali’s sales and profits have grown exponentially over the last few years, and now that the company is venturing into other sectors it will be interesting to see whether it could repeat a similar success story as that of FMCG.
Baba Ramdev launched Swadeshi Samriddhi SIM cards on 28th May, which for now will be available only to employees and office bearers of Patanjali. The SIM card was launched in alliance with India state-owned telecom giant Bharat Sanchar Nigam Limited (BSNL), and offers 2GB data pack, unlimited calls across India and 100 SMS for a recharge of 144 per month. Once the SIM card is available to the public, people will get 10 percent discount on Patanjali products with this card. Speaking on the occasion of the launch, Baba Ramdev said “there are five lakh counters of BSNL and from there people can soon get Patanjali swadeshi-samradhi card.”
Indian telecom sector is already extremely competitive since entry of Reliance Jio in the market in late 2016, which had with its low pricing captured almost 15 percent of the Indian market with a short span of one and half years. The other big private companies competing are Vodafone-Idea which controls almost 36 percent of the market since the merger in 2017, along with Sunil Mittal led Bharti Airtel which controls 33 percent of the market. The state-led BSNL which is launching the SIM cards in alliance with Patanjali controls 10 percent of the market share. The state-run company hopes to compete with aggressive private players like Jio, Airtel, and Vodafone by riding on the brand loyalty of Patanjali. The Patanjali plan of BSNL is similar to monthly plans of Jio and Airtel with free calling and daily limited data plans. Sunil Garg, BSNL Chief General Manager said “Patanjali’s plan is BSNL’s best plan. In Rs 144, one can make unlimited calls from any part of the country. We are giving 2 GB data pack, 100 SMSs. The members of the Patanjali have to just show their identity and there SIM will be activated soon after some paperwork.”
The Indian telecom sector pricing is already in ‘race to the bottom’ since the entry of Jio, as the profits in the sector are extremely low due to cut-throat competition. The biggest challenge for Baba Ramdev will be to take on Mukesh Ambani who is well known for establishing a monopoly in whatever industry he enters. He has already proved it by capturing 15 percent of the market within just one and a half years, having brought down the prices of calling and internet by almost 50 percent.
Baba Ramdev is using the plank of the welfare of the people and country for marketing Patanjali SIM cards. He said government-owned BSNL is a ‘Swadeshi network’ and the motive of both Patanjali and BSNL is the welfare of the country. In addition to attractive data and call package, the card also comes with the medical and life insurance covers of Rs 2.5 lakh and Rs 5 lakh, respectively. Only time will tell whether this new ‘plank of welfare’ will work, or turn out to be the Waterloo moment for Baba Ramdev.