Companies

Sebamed mulls local manufacturing, new price points, smaller variants

Nandana James Mumbai | Updated on April 01, 2021

Personal care market is ripe for disruption, says India head Shashi Ranjan

As part of a multi-pronged strategy to scale up presence in India, German premium personal care company Sebamed is exploring the option to start manufacturing in India. The company is also looking at introducing its products at different price points and smaller variants in a bid to grow 10-fold in the next five years.

Sebamed operates in the premium segment in India, with products in the baby care and personal care segments. It currently imports products from Germany.

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Sharing his thoughts on the possibility of setting up manufacturing plants in India, Shashi Ranjan, India Head, Sebamed, told BusinessLine, “These points are open for discussion… (We will do) whatever is required to enhance the ability to ensure that we remove any bottleneck to address the needs of the consumer by making the products available in the right quantity or right packaging or right variants. And if that means moving the products and facility closer to the customer where the demand is, we would be open about it. So that is certainly on the cards as well as we speak. The discussion is still on.”

In the same way, Sebamed is also considering different price points as well as rolling out smaller variants, he said. Sebamed plans to invest in brand building and network expansion to grow 10 times in the next five years. “If price is a bottleneck as we move from X to 10X in the next five years, obviously we will try to get into newer consumer segments and move to the next consumer segment, and that is where we are open, agile and flexible to look at smaller variants or different pricing points so that a consumer should not leave or it should not be a barrier for consumers to try,” he explained.

The 10-fold growth will not come from the existing customer base and Sebamed will need to go to new consumers, he further stated. “Unless and until we move to a new set of consumers and that also in a multiplier effect, we won't be able to achieve our 10X numbers and and whatever bottleneck is there in terms of achieving that, whether it is pricing point, whether it is smaller variants or a different product altogether, we will be coming back with that.”

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Sebamed also aspires to be positioned as one of the best products in the Indian personal care market, said Ranjan. “The Indian personal care market is ripe for disruption. Even now, what we have done is just the tip of the iceberg because in this particular segment, across multiple categories, there is huge scope to create positive disruption in the interest of Indian consumers.”

Sebamed has operated in India for around 10 years through prescription-based sales from doctors and dermatologists. In 2018, it started FMCG sales through traditional channels, and Sebamed has grown five-fold since then, said Ranjan. The current revenue of the company is around ₹400 crore in MRP terms. As a part of its plan to growth plan, reach expansion is a major strategy, with plans to expand from the current 47 cities it is present in to 100 cities by the end of this year, especially in general trade.

Sebamed was recently embroiled in a legal battle with FMCG major Hindustan Unilever Limited after Sebamed likened HUL’s beauty soaps to their detergent bars in an advertisement. “Did you know the pH of Lux is the same as Rin?” it had asked in a print campaign in January. This allegation kicked up a furore, with HUL promptly hitting back with an ad from Dove saying it was recommended by dermatologists.

“The campaign was not targeted towards a particular company or organisation; the campaign was aimed or focused on educating and empowering Indian consumers. And if I look at Indian personal care market, in the last three to four decades, there has hardly been any positive disruption which has happened.” He added that Sebamed also wanted to “create a culture of inquiry.”

Published on April 01, 2021

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