To track the story of Parachute, one needs to go back to the late 1940s, when Bombay Oil Industries Limited (BOIL) was started as a family venture selling vegetable oil. A young man named Harsh Mariwala, who joined his family’s business, took over the consumer products division and brought in some organisational changes, drawing in talented people from diverse backgrounds to make the business more professional.
He started the company’s branded products section in 1975, supervised the emergence of Parachute Coconut Oil and Saffola, and put in place a national distribution network for Parachute.
The advantage of selling coconut oil was that a ready market was available: there were no mental blocks to be overcome and there was no need to make the consumer ‘aware’ of the product.
But how did he make Parachute stand out among other coconut oils being sold in the market till then?
Tin to plastic
In an age when packing coconut oil in tins was the norm, Harsh Mariwala had the innovative idea of packing the same in plastic containers — a pioneering effort that led to an industry-wide shift in packing.
The change from tin to plastic containers was made in the early 1980s; the latter were cheaper, more attractive and offered an easier pouring option. But it wasn’t easy to distribute the products. Dealers were reluctant to stock the products: a decade ago, another entrepreneur had tried to pack coconut oil in square-shaped plastic bottles. But since the packing was of inferior quality, the oil had oozed out, attracting rats that destroyed merchandise at the dealers’ shops.
To overcome this problem, Marico used a round-shaped design and packaging that allowed no seepage or oozing. They tested the same by keeping a few bottles along with some rats in a cage, and convinced traders. The complete transition, however, took more than a decade, and made them market leaders, with ‘Parachute’ becoming synonymous with coconut oil.
Growing and expansion
Harsh Mariwala moved out from BOIL to form Marico in 1988. By then, the ubiquitous blue bottle that spells purity and good health, certified by FSSAI and with the green vegetarian symbol, could be seen in almost every household across the country.
The following years saw several breakthrough steps at Marico, with the launch of ‘Hair & Care’; the shift to an upscale location; the introduction of a cold-water starch named Revive; the opening of an international office in Dubai, and listing on the stock exchanges.
In 1999, Marico resisted a takeover bid from HUL with the rallying slogan ‘Parachute ki kasam’ . It also acquired Mediker and opened an overseas manufacturing facility at Bangladesh.
Other innovations and acquisitions followed, but Marico is still associated mainly with Parachute and Saffola, both of which it acquired from BOIL in 2001.
Copycats
Any popular product is soon imitated. Parachute, at one time, is said to have had about 100 copycats eating into its profits. These were dealt with by creating a new, expensive mould which the imitators found impossible to copy. The innovations in packaging, sizing and tamper-proofing continued, with plastic containers being made for all seasons; tamper-proof flip-top packaging to ensure purity; special packaging for rural areas; and the mini bottle single-use pack, which swung the sachet segment Parachute’s way, winning over undecided ‘loose’ oil users.
Location and plants
Marico’s factories are located at Pondicherry, Kanjikode, Dehradun, Jalgaon, Paldhi, Baddi and Paonta Sahib. In Bangladesh, it operates through Marico Bangladesh Limited, a wholly-owned subsidiary. It is said to be the largest Indian company in Bangladesh, with an 80 per cent market share and is even quoted on the stock exchange.
Marico’s plant location is determined by the availability of raw materials; the company uses the JIT (just-in-time) approach for handling the same. Since coconut is Parachute’s basic ingredient, the company has made efforts to team up with farmers to understand the best methods of cultivation and procurement practices. It has set up model farms along with the Kerala government to promote scientific farming and has collaborated with the Coconut Board of India to uplift and transform the lives of coconut farmers.
Marico’s nationwide distribution network is said to cover towns with a population of more than 20,000. It has about four regional offices, 32 carrying and forwarding agents (CFAs), about 5000 distributors and stockists, and around 4.6 million retail outlets.
Innovation and advertising
How much can you innovate with coconut oil, especially for a new generation that does not believe in oiling hair? Marico has gone in for value addition in the hair oil segment with detangling products, softeners, pre-wash, post-wash, hair-fall solutions, serums, and dandruff solutions, among other offerings. Thus followed Parachute Advansed, Scalp Therapie, Advansed Jasmine, Deep Conditioning Hot Oil, Advansed Coconut, Ayurvedic, After Shower and Aloe Vera for hair.
Entering the skin care segment, Marico came up with Parachute Advansed Body Lotion with several variants, including a spray-on version.
Parachute advertises through TV, print ads, radio and even the digital mode. It uses van campaigns, haat s (markets in rural areas) and sponsors jatra, or open-air folk theatre, to promote the brand name. Advertising increases before Holi and during the winter season. One of the most effective ad campaigns was ‘1 hour champi kiya? ’ that drove home the importance of oiling hair before a shampoo to give it ‘life’.
Marico conducts Personal Hygiene Awareness Camps in schools and offers student discount coupons and loyalty points to encourage customers to stick with the brand.
The green side
Marico’s products are sold in about 25 countries and it recorded a turnover of ₹61 billion in 2015-16. Even today, 25 per cent of the consolidated turnover comes from Parachute (bottle) sales, with the brand maintaining its market share at over 50 per cent in India in the coconut oil category.
Marico has taken the initiative to reduce greenhouse gas emissions by increasing the use of biomass fuels in all facilities. It has cut down on waste generation by optimising the packaging design, reducing packaging material, introducing lightweight bottles, recycling and reusing.
Most of their manufacturing locations carry the ISO:14001 Environment Management System certification, with the largest manufacturing plant at Baddi having the ISO: 50001 Energy Management System certification. Even the corporate office in Kalina, Mumbai is a Green Building that controls illumination through intelligent light sensors and saves water.
These efforts have seen the company winning several accolades in green manufacturing like the CII Water Conservation award, CII Energy Conservation award, Greentech Environment Excellence award, National Energy Conservation award and CII Excellence in Energy Management award.
On the CSR front, the Marico Innovation Foundation, begun in 2003, works with people from different fields to promote innovation of any type. The Yuva Parivartan is an NGO that gives vocational training to hundreds of youth looking to better their lives. Apart from this, steps are taken to ensure education for all mobile schools operating in some areas. The aim is to prevent drop-outs and increase school attendance.
Why the name?
Finally, why did a coconut oil get the name ‘Parachute’? The story goes that Harsh Mariwala’s uncle gave the product its name, as parachute troops were covered in the press very often during the Indo-Pak and Indo-China wars of the1960s, in which they acquitted themselves very well.
The oil named after the elite troops has done quite well too!