Celebrating 61 Years of Pidilite
Author - Ananya Garg
Adhesive Industry
● The India Adhesives & Sealants market is expected to record a CAGR of 11.17% during the forecast period of 2019-2024.
● The India adhesives and sealants market is consolidated, with the top four players with an approximate market share of 85.3%. The major companies include Pidilite Industries, Henkel AG & Co, Sika, Arkema Group (Bostik India), and H.B. Fuller Company.
Pidilite
● Founded in 1959 by Balvant Kalyanji Parekh
● Indian based adhesives manufacturing company (started as a pigment company)
● It also sells art material, construction chemicals, and other industrial chemicals.
● Pidilite markets the Fevicol range of adhesives. Its other brands are FeviKwik, Dr. Fixit, Roff, Cyclo, Ranipal, Hobby Ideas, M-seal, and Acron
● Owner – Madhukar Parekh
● CEO – Bharat Puri
● Reported net profit for 2019-20: Rs 1,122.05 crore
● Market Share: 70%
● Believes in Blue Ocean Strategy: creates categories instead of entering into existing categories
○ Dr Fixit: In year 2000, Pidilite latched on to an opportunity in the untapped and unorganised waterproofing business by acquiring Mr. Fixit (later Dr Fixit) from the Mahindras. The strategy was set — find niche sectors and create a compelling product.
○ Fevicol Marine: When the industry was talking about introducing waterproof plywood and water-resistant laminates, Pidilite introduced a variant of Fevicol, Fevicol Marine for wet conditions
Revenue Split (2018-19)
Timeline
1959: The company started with a single factory in Kondivita Village, Mumbai that manufactured only one product, Fevicol. Prior to fevicol, animal fat, which was clumsy and cumbersome, was the only glue available.
1963: First modern manufacturing plant was established in Kondivita Village, Mumbai
1965: Fevicol established as the preferred choice among target market i.e. carpenters
1985: Fevikwik Launched
1990: The name, Pidilite Industries Private Limited, was incorporated, thus taking the first step towards brand recognition.
1992: Madhukar B. Parekh, son of Balvant Parekh takes over as the new Chairman and M.D.
1993: Listed on NSE; valued at INR 60 crore
2000: Dr. Fixit, an extensive range of Construction Chemicals, was acquired from Mahindra & Mahindra - waterproofing solution to be used in new constructions, or in the repair of old ones.
2002: Launched Hobby Ideas as India’s first chain of art, craft, and hobby stores
2005: First international subsidiary in Singapore, followed by subsidiaries in the Middle East & Brazil
2014: Ranked among the best 100 brands of 2014 by Economic Times
2015: Bharat Puri Appointed as Managing Director
2016: 'Most Promising Company of the Year Award' at the CNBC-TV18, 11th Indian Business Leader Awards (IBLA)
2019: Pidilite invested in Pepperfry and Home Lane to access newer customers, products, markets, technologies and trends
Acquisitions
● 2000: M-Seal and Dr. Fixit acquired from M&M
● 2002: Steel Grip – Leading brand of PVC insulation tape – acquired from M&M
● 2004: Roff – Pioneer of construction chemicals in India
● 2006: Sargent Arts Inc. – World-class art materials space in the USA
● 2006: Tristar Colman –Canvas and student art colors
● 2006: Cyclo – Brand of automotive maintenance products
● 2008: Holdtite – Sealant business of Hard Castle Ltd
● 2009: Woodlok – Retail woodworking brand of Henkel
● 2013: Falcofix – adhesives business of Suparshva Adhesives and bluecoat
Fevicol
1965: Fevicol established as the preferred choice among target market i.e. carpenters
1970: First product line extension introduced for the retail market - 30 gm collapsible tube
1970: Logo by OBM’s (then Ogilvy, Benson and Mather) designer M. Swaminathan (till date the same elephant is used in the logo to signify the strength of the Fevicol)
1997: Fevicol released its first TV ad, ‘Dum laga ke haisha’, featuring filmmaker Rajkumar Hirani and is ranked amongst the Top 15 Indian brands by FE Brandwagon Yearbook 1997.
2000: Fevicol campaign won the Silver ABBY for the Campaign of the Century in India
2002: The famous Fevicol 'Bus ad' not only won the hearts of the Indian people but also the world, going ahead to win the Silver Lion award at Cannes Lions International Festival of Creativity 2002.
➢ Uses Demand pulling strategy: Approaching contractors/carpenters and they, in turn, asking for the product from the dealers
➢ Various variants:
○ Fevicol SH: Synthetic resin adhesive intended for woodworking
○ Fevicol MR: Used for bonding paper, cardboard, thermocol, fabrics, wood, and plywood
○ Fevicol Marine: Waterproof adhesive for wet areas
○ Fevicol HI-PER: High-performance adhesive for premium laminates
➢ Fevicol Champions Club (FCC): Started in 2002 (initially launched only in Kanpur and Surat) to provide soft skills training to carpenters, contractors; training for using the equipment. FCC helps them in social networking and to provide recognition in society and to uplift their families by educating their children.
➢ Brand Communication
○ Fevicol synonymous with adhesives/glue
○ Creative advertisement campaigns, highlighting product strengths through the use of witty humour
○ Rural backdrop in advertising/promotional campaigns
○ Most of the ads are an outcome of honest conversations with the consumers (Piyush Pandey)
○ Native Indian rusticity along with the usage of local language coupled with humour has played a critical role in establishing connect with rural consumers which are key market
○ Involves actual users of products directly in advertisements
Fevicol - Iconic ads
Fevikwik
● Unlocks new usage opportunities that would help the category expand
● Cashcow for Pidilite
● Marketing communication elements: Rumour + Functional benefits + Emotional
● Changing value propositions in advertisements with time: Initially focus on the word “INSTANTLY” fix things to “SIRF 5 RUPAYE me”
● 2017: Launched a series with a woman repairing things using Fevikwik (based on insights that only males are involved in repairs)
Moment Marketing
SWOT Analysis
Strengths
● Market leader in adhesives with strong portfolio of trusted brands
● R&D has been a priority area for Pidilite to ensure it was present at the right place at the right time coupled with persistent innovation focused on continuous improvement
● Operations in more than 70 countries with 8 facilities outside India
● Strong Brand Equity and Brand Strategy
● Smart Advertising & Promotions
● Educating decision-makers
● Relevant Acquisitions to diversify and expand the category as well as the business
● Loyal Distributors & Retailers association
Weaknesses
● Over-dependence on Fevicol (Premium White Glue), M Seal (Epoxy Adhesive) & Fevikwik (Cyanoacrylate Super glue)
● Weak International Business Process
Opportunities
● Indian packaging industry is growing at 22-25% per annum
● Tremendous growth opportunities for Home specific stores like HomeTown & HomeShop
● Launching premium variants for some of the most used products
Threats
● The entry of paint players in waterproofing space
● The raw material is dependent on crude oil price making the company’s business operation cost fluctuating due to this
● Global trade getting hit due to the global economic decline and due to which exports gets affected
Distribution Channel
