In the 1970s when Mr. Harsh Mariwala started, he inherited the edible oil business which was mainly B2B from BOIL. The products used to be sold in Tins, barrels, etc. A shift was done From unbranded to branded through consumer-friendly marketing.
Harsh Mariwala spent the next 15 years creating and popularizing consumer brands for the company’s key commodity of coconut and edible oils, learning what he could from consultants on everything from hiring to distribution.
He worked in the consumer products division—which included coconut oil (Parachute) and edible oil (Saffola)—of the various businesses under Bombay Oil Industries Limited (BOIL) which was the family business.
When he joined BOIL, both the brands were doing reasonably well but remained business-to-business (B2B). Mariwala wanted to switch to a higher-margin, business-to-consumer (B2C) model.
He started with small steps such as switching packaging from bulky tin cans of 15 liters to smaller packs of 100 milliliters. He followed this up by seeking professional help in four critical areas:
– Advertising (hired Clarion Advertising agency for the Parachute advertising campaign)
– Marketing (sought advice from renowned professor Labdhi Bhandari of IIM-A)
– Human resources (sought advice from his friend Homi Mulla, HR head at Monsanto)
– Distribution (recruited Basutkar, a veteran from Hindustan Unilever).
Consulting professionals would become a defining trait for Mariwala and a founding principle for Marico.
He also eyed the burgeoning sunflower oil market which led to the launch of Sweekar in 1989. By 1991, Marico became the market leader in edible oils commanding about 14% cent market share. ITC came a close second with a market share of 12%.
By the late 1970s, Mariwala’s consumer products division had outgrown all the other businesses under BOIL.
Over 1975–90, while the consumer products division contributed over 80 per cent to the sales/profits for BOIL, less than 10 per cent of the total capital deployment of BOIL was directed towards this division (out of Rs 4.4 crore spent on plant and machinery by BOIL over 1975–90, only Rs 40 lakh was deployed towards the consumer products division).
Taken from Unusual Billionaires book.