Storyboard18 | ‘We like buying brands... especially in the OTC space,’ Nandini Piramal

Our birth rate is at about 2% so we’ve got new consumers of our diapers and wipes coming in every day or every minute really. We're excited about that category. We're really excited about Lacto Calamine. It used to be just a lotion, we launched the sunscreen, an aloe vera gel, face wash and cleansing wipes and we've actually really broadened the range. We think that will provide a solution to more people.

So that's part of how we're thinking about it. We've also invested in ecommerce in the last two years. Ecommerce has exploded in the country and that'll still be a continuing source of growth for everybody.

What are the key consumer and market insights that are informing your strategies in retail, your portfolio, the products and categories that you're getting into and broadening? 

More than two years ago, pre-Vovid, ecommerce was only maybe 5% of retail sales overall. We saw that it would be a source of growth and we set up the infrastructure for it. But in the two years of Covid, ecommerce exploded as people weren't going out, they were looking to understand new products and they're looking to, you know, try new brands. So what we did is use that ecommerce infrastructure to really invest in baby and beauty because those are the categories that ecommerce works well in. We launched a lot of new products as a way to experiment and try and see what works. So since then, in baby for instance, we've launched maybe about 30 or 40 extensions and SKUs and maybe a slightly smaller number in beauty.

But the idea is that we experiment, try new products, see what works, see when you can get to scale. And then you actually take it to offline retail and get even more scale that way. Because the hard part is getting that first 100 crore of sales and then once you have people that know your brand, know what it's like, and then when you take it offline and you actually move faster.

That's how we changed our strategy. It used to be that you'd launch it in a city or town, take it to four zones in the country, then you would go nationwide. This way, you can actually do an ecommerce launch first and get enough scale. And if you fail, actually, that's great. Because then you’d have failed faster. And if you succeed, then I think you have that scale to go even higher.

Overall we're gonna continue to broaden the range in baby. We’ll expand the care and feeding range as well as the personal care for babies and continue to actually offer a holistic solution for babies, new toys and all of that. In beauty, we've got a whole plan of experimenting and trying. We just launched our aloe vera gel with 99% aloe vera. We're going to launch various face masks and creams and things like that which sort of appeal to what is beauty and what people want today.

Beauty is an awfully crowded space right now with the emergence of a whole bunch of D2C brands. Is the company a little late to that party? 

Lacto Calamine is a heritage brand so a lot of people know it, and a lot of people use it as a way of oil control. And by keeping that promise of oil control, we're actually looking at how to contemporize and modernize the brand so that it makes it more exciting for people and more relevant to the consumer today. I think Indians are still expanding their understanding of beauty, what they need and how it's relevant to them. So I think there’s still room to grow.

Tell us more about your organic versus inorganic growth as a strategy? 

Overall as a company we've been an acquisitive company. We've been acquiring brands and acquiring capabilities in this context. In the last two years, we did one where we bought an equity stake in a biologics development capability, and that's something that we are interested in because biologics is the next frontier. Not everything will be a biologic, small molecule or the traditional will still continue, but biologics is a new way. So we wanted to understand and partner with people who really know biologics so we can learn more about it.

The other one which is a bigger acquisition was a company called Hemmo, which does a type of molecule called Peptides. Again, these are capabilities that not everyone has, and there are not many peptides development companies in the world. For us, that was a great way of adding capabilities.

As a company, we could look at capabilities that we don't have and would add a compliment to us, and then by integrating them into Piramal we can actually give an integrated solution to our customers.

Even for brands, if I look at it, I can buy the brand and we have the distribution system all set up, you get a fair amount of synergies. For example, when we bought Little’s. It was about 2017 when we bought the brand over and it's taken us some time but we've crossed Rs 100 crore of sales this year. We sort of pruned the range a little bit, got back to the basics, and then said okay, what is this brand really about? How can we actually appeal to the consumer and really understand the consumer - where are they buying, what are they thinking, and then expanding back again.

So we like buying brands as well, especially in the OTC space, because it's a good way for us to take a brand, understand the consumer and really put money and investment behind it to actually grow it and to scale it.

As Piramal Pharma we’re still part of the Piramal Group. Our purpose which is ‘doing well and doing good’ will continue. Our values - knowledge, action, care, and impact, are incredibly important to us. They're going to continue to percolate through pretty much everything. We're believers in the values and I think that they actually form a huge part of our culture.

The way we look at it is saying how can we have behaviours that actually reflect the values? And how do we actually assess and measure people by those behaviours as well? As we articulate that, our culture is going to be informed by the values and be very closely connected. So it's not going to be very different. We are a global company and we are going to be India headquartered. But we have a lot of global accounts and we have a lot of global people and we have to connect and integrate that.

What are some of the sort of pandemic-born insights that have shaped your approach to building brands and growing the company and the business?

Ecommerce has completely changed how we launch brands. We used to launch maybe four SKUs a year. And maybe you only really knew if it was successful or not two years later. With ecommerce you will learn very, very quickly if your products have succeeded or failed. So we launched products with a way to say ‘Look, can I get into the ranking of, whether it's Amazon or Flipkart or others, so that I can be on page one of search’, which is a very different approach to making sure that my products are present in Allahabad or Ghaziabad or Nagpur.

We had to learn different skills, whether it's in the analytics team or even how we actually partner with the ecommerce portals and what kind of advertising you do, whether digital advertising or the distribution focus that used to be there. So we've all had to learn different skills.

Can you tell us more about your advertising and media strategy and roping in a host of celebrities as brand endorsers? 

It helps cut through the clutter. If you can find the right product and the right celebrity, it really makes a difference in the right market. So we invested with Kareena Kapoor Khan and Saif Ali Khan for our Little’s brand and I have to say they've done an amazing job. We've seen that both in ecommerce and in traditional trade, we've seen a very good response to our products. And we think that is making a difference.

As we look at our power brands, we'll keep looking and seeing whether this makes sense and whether we want to invest in the kind of characters and people that make sense for us. At the right time, I think there will be more celebrity endorsements.

Digital ad spends have increased but we're still doing a lot of TV mass campaigns because a lot of our products are appealing to a fairly wide range of Indians and we continue that. TV, for those, is still the best way. For a certain urban section, you do need to do digital, but also search based advertising has become much bigger, and that's going to continue to be part of it. Because when it is search-based people are intentional about looking for something and that is a good indicator of consumption or buying patterns.

This interview first aired on Storyboard18 on CNBC-TV18. Read the full interview on Moneycontrol and Forbes India.