What is the first thing which comes to your mind when you hear the word ‘NIRMA’ somewhere? Nirma Soaps, detergents, even university, or probably it’s decades old catchy detergent song ‘Sabki pasand Nirma’. Evidently the song as well as the brand has become ‘sabki pasand’ with time but have you ever wondered who would be the man behind these products and institutions. Must’ve been a professional degree holder in marketing or management from one of the prestigious Institute of the country, right? Wrong!
Dr. Karsanbhai Khodidas Patel is the founder of the present Rs. 3550 crore Nirma group with main activities in detergents, soaps, cosmetics, and salt.
Though Karsanbhai Patel does not have a professional degree in marketing, yet he proved that a professional marketer does not need a formal degree in marketing to be successful!
If marketing is to find the gaps and fill them, Karsanbhai Patel just hit the bull’s-eye.
Karsanbhai Khodidas Patel is a benefitting example of a self-made man. Coming from a humble farmer family, he understood the need of the masses to serve a segment that was neglected but at the same time highly profitable. He established his firm in the lower income segment of the detergent market, gradually overtaking many heavyweights and multinationals, to emerge as a winner. Literally, he made money by washing others’ dirty linens.
He is the founder of powerful brand NIRMA which he aptly positioned using 4 Ps of marketing, viz. Product, price, place and promotion, to his advantage.
Karsanbhai Khodidas was born in 1945, in Ruppur village in north Gujarat in a family of farmers. He graduated in Chemistry at the age of 21. In 1969, Karsanbhai Patel, a chemist at the Gujarat Government's Department of Mining and Geology manufactured phosphate free Synthetic Detergent Powder Nirma (named after his daughter Nirupama), and started selling it locally. Karsanbhai Patel dedicated his after office hours for manufacturing his detergent powder in the backyard of his house and then carried out door to door selling on his bicycle while going to his work place, which was 17km from his home. . He gave a money back guarantee with every pack that was sold. Karsanbhai Patel managed to offer his detergent powder for Rs. 3 per kg when the cheapest detergent at that time was Rs.13 per kg and so he was able to successfully target the middle and lower middle income segment. It gave the bigger established brands a run for their money and soon occupied the top market share. To add to all this, Nirma was made of an innovative formulation, which global detergent giants were later on compelled to emulate, it was phosphate free and hence environment friendly, and the process of manufacturing was labour intensive, which offered large scale employment.
Nirma became a huge success and all this was a result of Karsanbhai’s entrepreneurial skills. Within a short span, Nirma had completely rewritten the rules of the game, by offering good quality products at an unbeatably low price.
Nirma's success was attributed to its focus on cost effectiveness. From the very beginning, Patel had focussed on selling high-value products at the lowest possible price. The company endeavoured to keep improving quality while cutting costs.
Karsanbhai jagged up one success after another. After establishing its leadership in economy-priced detergents, Nirma foray into the premium segment, launching toilet soaps Nirma bath and Nirma beauty soap, and premium detergent Super Nirma detergent. Overall Nirma has a 20% market share in soap cakes and about 35% in detergents. Nirma also has successful operations in neighbouring countries.
As far as corporate social responsibility (CSR) is concerned, Nirma has made some good efforts by starting Nirma Education & Research Foundation (NERF) in the year 1994 for the purpose of running various educational institutes. In 1995, Karsanbhai started the Nirma Institute of Technology in Ahmedabad, which grew into a leading engineering college in Gujarat. Nirma has also set up Nirma labs, which prepares aspiring entrepreneurs to effectively face the different business challenges. Nirma also runs Nirma Memorial Trust, Nirma Foundation and Chanasma Ruppur Gram Vikas Trust as a part of their effort as a socially responsible corporate citizen. It also owns Nirma University.
Challenging established multinationals needs extreme courage and to win in the long run needs marketing foresight. Karsanbhai Khodidas Patel, once a government servant with the knowledge and experience as a chemist offered a good product and was aggressive in marketing strategy. He made the multinationals to follow Nirma and introduce substitutes such as Wheel. In this respect, the Nirma case can be compared to those of Ford, Apple, Sony, and Honda, all one-of-a-kind entrepreneurs who built their empire on gut feeling rather than following the classical patterns taught in business schools. This is a genuine road from rags-to-riches one would like to follow.