Exclusive: The epic story of Emami - Pioneering growth in every stride

In the 1970s, Radheshyam Agarwal and Radheshyam Goenka embarked on a daring journey, leaving behind their stable corporate positions at the Birla group to pursue a dream. Their relentless efforts, perseverance, and unwavering entrepreneurial spirit culminated in the establishment of what is now known as the Emami Group, one of the leading diversified multinational conglomerates. Over the years, Emami has built a strong reputation in the healthcare and personal care industry, recently commemorating its 50th anniversary with pride.

The company began its journey as a manufacturer and marketer of face cream when it established Kemco Chemicals, a cosmetic manufacturing unit in Kolkata, in 1974. Its trajectory is truly inspiring, embodying strength, courage, determination, and excellence, never faltering in the face of challenges. By 2023, the company’s overall group revenue had soared past the Rs 30,000 crore mark. Amid the Covid-19 pandemic, the company experienced significant revenue growth, particularly with introduction of the hand sanitizer under BoroPlus brand to meet the escalating demand during that period.

Emami Group boasts a portfolio of brands, including BoroPlus, Kesh King, Navratna, Fair and Handsome, Zandu, Menthoplus Balm, Emami Healthy & Tasty edible oil and more.

In a discussion with Adgully, Aditya Vardhan Agarwal, Director of Emami Group, explores the company’s journey thus far and the guiding principles it adheres to.

During its inception, Emami Founders, RS Agarwal and RS Goenka introduced products under the brand name of Emami like Emami Vanishing Cream, Emami Cold Cream, and Emami Talcum Powder. In 1978, they acquired Himani Limited in Bengal. Subsequently, in 1981, they ventured into the paper industry on a small scale in Balasore, Odisha. In the personal care segment, they continued to expand their product line, launching Navratna and BoroPlus, with the latter achieving widespread success across India and, currently commanding a market share of over 60%. Emami then diversified into other sectors, including ballpoint pens, and acquired a pharmacy chain named Frank Ross, which originally hailed from a 100-year-old British company. Today, Emami Frank Ross operates approximately 250+ outlets across the states of West Bengal, Assam, Tripura, Bihar, Chhattisgarh, Karnataka, Tamil Nadu and Odisha. The FMCG arm of the Group, Emami Ltd, later introduced Fair and Handsome, India’s first fairness cream for men and acquired a century old ayurvedic brand, Zandu, among its FMCG offerings.

Referring to the legendary Zandu acquisition done in 2008 by the flagship FMCG company of the Group – Emami Limited, Aditya Agarwal emphasised, “Despite challenges such as the Lehman Brothers crisis, Mr. Agarwal and Mr. Goenka remained steadfast in their vision. They had unwavering conviction and meticulously calculated their moves, ensuring everything was carefully planned and designed.”

Emami aggressively focussed on FMCG sectors, establishing Emami Limited, the flagship personal care & healthcare products manufacturing entity and Emami Agrotech, specializing in edible oils and food brands. Additionally, Emami ventured into paper manufacturing, becoming the largest newsprint manufacturer in the country, later diversifying into premium quality packaging boards and writing papers. The paper industry factory is located in Balasore, Odisha and operates using waste paper as its primary raw material. Subsequently, the Group expanded its portfolio to include Emami Realty, Frank Ross’s retail chain, and Starmark, a gifting format retail chain offering music, books, toys, and stationery. Presently, there are five Starmark outlets in Kolkata. Emami also operates an art & creativity centre – the Kolkata Centre for Creativity, spanning 70,000 square feet, dedicated to promoting art and culture. Emami Art, a leading contemporary art gallery, is located within Kolkata Centre for Creativity.

Additionally, Emami’s ballpoint pen manufacturing unit, headquartered in Kolkata with its plants in Bengal and Ahmedabad, the 2nd largest manufacturer of ballpoint tips in the world, is headquartered in Kolkata.

Talking about attracting quality pool of human resources, Aditya Agarwal highlighted that Emami benefits from being a preferred choice for those wanting to return to Kolkata, leveraging its strong presence in the Eastern market. However, he acknowledged the challenge of attracting talent, as not everyone desires to relocate to Kolkata, for being established elsewhere. To address this, Emami established a sizable office in Mumbai, where some of the marketing teams are based. Moreover, the company embraced remote work during the COVID-19 pandemic, realizing its efficacy and efficiency. Agarwal expressed contentment with their current approach, incorporating a blend of regular office and work-from-home strategies, which has positioned them well.

According to Aditya Agarwal, Emami’s longevity and success over the last five decades have been driven by two key factors. Firstly, the company’s unwavering commitment to trustworthiness, ensuring consumers receive products of the right quality that fulfil their needs. Secondly, Emami has been proactive and aggressive in its marketing and innovation strategies. Agarwal also emphasizes Emami’s focus on understanding consumers through extensive processes, including visiting numerous outlets and conducting consumer research. The company actively engages in product testing through panels to gather insights and refine its offerings based on consumer feedback.

Aditya Agarwal strongly believes that one of Emami’s greatest strengths lies in its deep understanding of the Indian consumer. He emphasizes that being a proud Indian, they are able to comprehend the mindset of the Indian populace. Agarwal recalls a past instance when they were hesitant about the launch of Sona Chandi Chyavanprash, a health product, wondering why people would try it. In response, they introduced a free trial pack, allowing consumers to taste the product risk-free. However, a renowned marketing consultant expressed scepticism, suggesting that people would take advantage of the offer and return the product even after consuming it for free. Contrary to this belief, Emami founders asserted that Indians don't behave in such a manner and are not inclined to receive something for free without genuine interest. This understanding of Indian consumer behaviour, according to Agarwal, is crucial for achieving success in the Indian market.

Aditya Agarwal reminisces about some memorable moments in Emami’s journey, highlighting the company’s innovative marketing strategies. He recalls the success of “Agar Tum Na Hote”, a film featuring Rajesh Khanna, Raj Babbar and Rekha, marking Emami’s foray into film advertising in the early 80s. This groundbreaking move set a trend in the industry at a time when there were no satellite channels. Recognizing Indians’ affinity for mythology, Emami collaborated with Ramanand Sagar to produce ‘Vikram Aur Betaal’, a hugely successful television series telecast on Doordarshan.

Throughout its journey, Emami has enlisted renowned personalities from Bollywood and the sports world as brand ambassadors, including Amitabh Bachchan, Shahrukh Khan, Salman Khan, Akshay Kumar, Katrina Kaif, Kareena Kapoor Khan, Hrithik Roshan,Sourav Ganguly, Sania Mirza, Saina Nehwal, Mary Kom, and Sachin Tendulkar, and many more. Agarwal emphasizes that in India, cricket and Bollywood hold significant sway, alongside religion, making them integral aspects of the cultural fabric.

Sports sponsorship of Emami

During the early 90s, Emami sponsored two iconic football clubs in India – Mohun Bagan and East Bengal – for three consecutive years. Today, Emami owns the Emami East Bengal football club. Aditya Agarwal acknowledges that while football has a long history in India, it is still in a relatively nascent stage compared to global standards. He believes there is much room for growth and development in the sport within the country, emphasizing the need for significant progress to catch up with international standards and trends.

Micro and nano-influencers

Aditya Agarwal reflects on Emami’s association with influencers, noting that the effectiveness of such collaborations depends on the creatives and how well the brand’s purpose is communicated to the influencer. He highlights the importance of being part of influencer marketing in today’s landscape, although measuring its impact can be challenging. Unlike advertising for specific products like apartments, where responses can be directly measured, mass marketing products like Emami’s, face difficulties in pinpointing which advertising efforts lead to conversions. Agarwal references the famous quote by John Wanamaker, an American marketer: “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

Spending on TVC and declining rates of print advertisements

Aditya Agarwal explains, “We allocate funds to news channels as well because they serve as reminders, and we’ve noticed that retailers tend to watch news channels more than general entertainment channels. Viewer preferences are quite imbalanced, typically at a ratio of 60:40, favouring news channels at their worst. Over time, print advertising has been steadily declining. However, we've observed a positive trend with an increase in Cover on Cover features and full-page advertisements, as opposed to smaller ones.”

Strategies and initiatives for continuing growth

Emami has been actively introducing new products and extensions to meet the demands of today’s consumers. For example, with Kesh King, they have shifted from just offering oil to now introducing a shampoo infused with onion extract, catering to current preferences. While some of these innovations have seen success, others have not performed as expected. Notably, amidst the challenges posed by Covid-19, Emami also launched an edible oil fortified with Vitamin C, showcasing their adaptability to evolving market needs.

Goals and aspirations for the next 50 years

Aditya Agarwal highlights Emami’s commitment to maintaining favour with both consumers and investors by striving for excellence in their work, which naturally leads to increased turnover, sales, and profits. He emphasizes that Emami’s initiatives are structured around benefiting four key pillars: employees, customers, stakeholders, and society.

Regarding employees, Agarwal mentions various programmes like conclaves held, featuring esteemed speakers such as Kumar Vishwas and Sonu Sood, as well as entertainment events with performers like Rekha Bhardwaj and talks perspectives from personalities like Sourav Ganguly. These learning opportunities are ongoing to ensure continuous development within the workforce.

To preserve Emami’s legacy and share its learnings, the company plans to establish a legacy centre resembling a museum, but focused on Emami’s insights and experiences. This initiative aims to educate and inspire both the company’s team and the wider community.

In terms of societal contribution, Emami is dedicated to promoting art and culture through initiatives such as art camps and donations like the sculpture titled ‘The Earth Keeper’ by noted sculptor Jagannath Panda, which is installed within Eco Park, Kolkata. These efforts reflect Emami’s commitment to the enrichment of society beyond business endeavours.

Agarwal expresses hope that these activities will enhance Emami’s reputation among stakeholders, leading to increased consumer trust and loyalty, thereby benefiting all parties involved.

Sustainability and CSR

Emami prioritizes sustainability by adopting renewable energy sources such as solar power across most of its plants and actively planting trees in and around its facilities. To commemorate its 50th anniversary, Emami pledged to plant 50,000 trees in and around its manufacturing facilities. Additionally, its paper mill primarily utilizes waste paper, while its edible oil division has ventured into producing biodiesel, a green alternative to traditional diesel. These ongoing efforts underscore Emami’s commitment to environmental sustainability, recognizing that its long-term existence relies on a thriving world. The company is dedicated to contributing to environmental well-being beyond the immediate future, striving to support and preserve the environment for generations to come.

Principles and ethics

Aditya Agarwal emphasizes the enduring importance of timeless principles such as honesty, hard work, and respect for others, which remain unchanged despite societal evolution. He highlights a book written by RS Agarwal and RS Goenka Ji, encapsulating these principles. Agarwal stresses the significance of balancing key aspects of life like health, wealth, and societal well-being, noting that personal happiness cannot be achieved at the expense of others’ discontent. He credits Emami’s founders for instilling these values and acknowledges the guidance they provide in decision-making by considering what the founders would do in similar situations. This adherence to foundational values guides Emami’s approach to governance and living.

Leveraging AI, IoT, or data analytics to enhance operations and customer experience

Aditya Agarwal acknowledges Emami’s progress in leveraging technology for various operational aspects, including sales analytics and production methods. While emphasizing ongoing efforts to innovate, he mentions the utilization of robotics in several manufacturing facilities. Specifically, Emami’s Haldia Edible Oil factory in Bengal stands out as the largest single location refinery in India, showcasing the company’s commitment to advanced production methods. Additionally, Emami has significant plants in locations such as Balasore, Odisha for paper production, Kandla in Gujarat and Krishnapatnam in Andhra Pradesh in Gujarat and Jaipur, Rajasthan for spice production. Emami Limited has its multiple manufacturing units across the entire country in Assam, Gujarat, Uttarakhand, Bengal and an overseas unit in Bangladesh. These strategic locations underline Emami’s wide geographical presence and investment in modern infrastructure to enhance efficiency and competitiveness.

Challenges as opportunities

Emami embraces a mindset that perceives challenges as opportunities for learning and growth rather than obstacles. Aditya Agarwal emphasizes the inevitability of ups and downs in life and business, advocating for a belief in destiny – what is meant to be yours will come to you, and what isn’t meant for you will not stay. This perspective helps the company navigate uncertainties without becoming overly discouraged. Agarwal poetically compares life’s fluctuations to the daily setting of the sun, suggesting that accepting the natural rhythm of life enables resilience and forward movement.