Dabur doesn't see threat from Patanjali's 'faith-based' items

Dabur India today said it is not worried about challenge to its ‘science-based’ ayurvedic FMCG items from ‘faith-based’ products from the stables of Yoga guru Baba Ramdev’s Patanjali and Sri Sri Ayurveda of Art of Living, saying competition has helped in expanding the market.

While admitting that in categories such as honey, the company has been impacted by products from Patanjali, Dabur India said being in the healthcare segment, the company is confident that quality will eventually decide consumer choice and not pricing alone.

“There is a difference between faith and science. We provide all products, which are science-based and we have some impact (on sales) on account of ‘faith-based’,” Dabur India CFO Lalit Malik told PTI.

He was responding to a query on how the advent of ayurvedic FMCG products from Patanjali, Sri Sri Ayurveda and even MSG by Gurmeet Ram Rahim Singh-led Dera Sacha Sauda, has impacted the company’s sales in the segment.

Malik said playing the pricing game in the segment will not pay in the long run despite consumers’ tendency to look at value for money.

“These are more healthcare products and people are very careful. We do see consumers coming back but having said that in the short run we have seen some impact on account of this competition,” he said.

Merely keeping low price may help in the lower segment initially but people have become much more aware and careful about their health and it will eventually determine value for money, Malik said.

When asked how much the company sales have been hurt by competition from new entrants, he said: “We will not be able to say anything in specific or particular but there is some impact of about one to one-and-a-half percentage, that has been the impact on honey.”

He further said: “The impact we have on account of Patanjali is primarily because of the price differentiation.  However, we do see the traction’s coming back as we have better quality and standards.”

In order to overcome the challenges posed by new competitors, he said, Dabur has come up with new variants and products positioning them as “premium products which we see as an advantage we get and we would continue to keep investing into that”.

Citing an example, he said, “If you look into the oral care, in spite of the competition we have been growing at high level digit. So it is helping us to grow because we are already ayurvedic and our products do not have any side-effects.”

Malik said due to competition in the segment, the market for ayurveda and herbal products has expanded.

Dabur has products such as honey, chyawanprash, Meswak tooth paste, hair oil, skin care, which directly compete with Patanjali Ayurveda’s items.