Apr 16, 2016

Guru-preneurs - Babas are the New Babes in Entrepreneurship

Rasananda Panda and RK Renin Singh
Orissa Diary
April 11, 2016


Sri Sri Ravishankar
Sri Sri Ravishankar
There is a new spiritual awakening happening in the business world today. Babas and Gurus who have up till now taught people how to perform yoga and enhance spirituality are now teaching the world a new lesson- how to do business!

With a decrease in volume growth and value, the FMCG (Fast Moving Consumer Goods) sector has been facing a crisis since quite some time. Hindustan Unilever Limited, one of the biggest FMCG players in India has its revenue growth in negative since the past seven quarters. From 13.2 per cent in June 2014 to 3.2 per cent in February 2016, there is a huge fall in the MNC’s revenue. Other competitors like ITC’s FMCG business has also fallen from 11-12 per cent to seven per cent in the same duration. The situation is same for other major FMCG players in India. Companies have been trying to cope up with the slow down using various strategies such as increasing ad spending, launching new products and starting various promotional schemes, but to no avail.

As against that, take for instance the case of Baba Ramdev’s Patanjali Ayurved. With an estimated turnover of Rs 5000 crores for FY 2016, Patanjali Ayurved on the other hand is growing rapidly day in and day out and the path ahead looks even brighter. Indian consumers have always looked for affordability as well as quality in every purchase they make. Patanjali products provide exactly this to the Indian customers. With 500 products in its product portfolio such as biscuits, juices, supplements, toiletries etc., Patanjali products are placed across as herbal and Ayurvedic products and are considered purer than similar products available in the market. Also, the products are priced quite low comparatively. Add to it the recent trend towards Ayurveda and health is acting as a catalyst in the process. It is hence a no brainer that the demand for Patanjali products has skyrocketed in just a few years after its launch.

Another fact to be noted here is the huge number of followers of these Guru-preneurs. With an estimated number of 70 million + followers, Patanjali products have an already established consumer base that believes in what Baba Ramdev suggests to them. Also, the gurus themselves act as the brand ambassador of these companies and the image of the gurus significantly helps in placing the products. Patanjali Ayurved also advertises aggressively on television with an earmarked Rs 300 Crore as advertisement expenditure thus far. With the tie up with Kishore Biyani owned Future group, Patanjali Ayurved has a well established and far reaching distribution channel. Should we not say strategic alliance?

Interestingly Ramdev baba is not the only one or even the first one to make a cocktail of religion with business. Sri Sri Ravishankar with its Sri Sri Ayurveda- an FMCG arm of Sri Sri’s Art of Living Foundation has also made quite inroads in Indian FMCG sector. Further, Sri Sri released Ojasvita- a malt based health drink targeting the market leaders- Horlicks (a product by GlaxoSmithKline) and Bournvita (a product by Mondelez International) who command 51 percent and 16 percent of the health drink market respectively.

With an even larger follower base of 370 million, the Art of Living Foundation is slowly inching on to the business of wellness and comfort to an otherwise irresistible Indian middle class. Unlike Patanjali Ayurved, Sri Sri Ayurveda products are sold only at POS (Point of Sale) and have just started to use the mass media. Other religious groups like BAPS (Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha), Aurobindo Ashram, Sadhguru Jaggi Vasudeva and ISKCON have also established themselves as reliable brands in the FMCG sector. BAPS produces and sells FMCG products under the BAPS Amrut brand name. Similarly Aurobindo Ashram and Sadhguru Jaggi Vasudeva (Isha foundation) produce and sell food, wellness and personal care items for its followers and own consumption.

The entry of Babas in business is not limited only to the FMCG sector but there are many other places the Guru-preneurs have started to show their mark.

Dera Sacha Sauda chief Gurmeet Ram Rahim Singh has entered the media and entertainment sector by releasing two movies - MSG: The Messenger and MSG-2: The Messenger. In both the films, Singh has acted as the main protagonist, directed, produced as well as gave music to both the films. Both the movies were heavily advertised along television and other digital platforms with considerable amount of budget spent towards it. The rock star image of Guru Ram Rahim and a significant number of followers in states of Haryana, Punjab and Rajasthan has made sure that there will be many takers for both the films and any film that is due to release. MSG: The Messenger had grossed Rs 216 crore in the box office collection and the second part is claimed to have entered the Rs 50 crore leagues by one of the Dera’s spokesperson. Going by the figures, it is easily seen that Guru Ram Rahim’s strategy is working and working quite good. Also it is believed that three more movies from the same production house are in the pipeline. Besides the movies, the Dera sells spiritual discourses, speeches and music composed by the Dera chief to the various followers. It is also expected that the Dera will also join the FMCG path as it has already taken the MSG franchise.

This trend is however not limited to India. It can also be seen globally as various religious organizations have capitalized on tourism as a source of revenue. Also Televangelism from where it all started is quite prominent in many parts of the world where the tele-evangelists sell their merchandizes.

The Indian economy, it seems is going to depend on these Gurus and Babas who are surely going to become the drivers of Indian economy in the near future. Other companies however will have to fight not only against the marketing strategies of these Guru led companies but also have to deal with the faith of their followers who are loyal to these guru-brands and thus constitutes a sizable market of their products.

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