Nirma – The Success of A Detergent

The son of a modest farmer and a science graduate, Karsanbhai Patel first worked as a lab technician at New Cotton Mills, Ahmedabad. The New Cotton Mills was owned by the Lalbhai group founded by Kasturbhai Lalbhai, co-founder of the Arvind Mills. He then worked as a chemist for the Gujarat government’s Department of Mining and Geology in 1969.

Given his experience in the laboratory, he attempted to create a detergent out of soda ash and other materials. Soon after he perfected the formulation, he began making detergents in his 100-square-foot garden as a side business after hours.

He cycled through neighbourhoods, stopping at people’s houses to sell the detergent packets. Karsan Bhai sold his detergent for Rs. 3, about a third less than Hindustan Unilever’s famous brand, Surf (Rs. 13). On his 15-kilometre-a-day bicycle commute to work, Patel sold an average of 15-20 packets every day. Patel’s hometown of Ruppur (Gujarat) quickly saw a surge in demand for Nirma. Customers saw significant value in purchasing the product because of its high quality and low price. After three years, Karsanbhai saw the business’s potential and left his job to focus on it.

The Brand Name

In memory of his daughter Nirupama, Patel christened the new powder Nirma. Nirupama was Karsan Bhai’s (Karsanbhai Patel’s) daughter, and Nirma was her nickname. There was an unfortunate accident that took her life. Her likeness (the girl in the white dress) was plastered all over the packaging and TV ads.

The product immediately gained popularity among middle-class consumers and those in the lower middle class. While most businesses expanded their reach from major cities to outlying areas, Nirma used a bottom-up strategy, forever altering the business landscape.
Knowing that Surf, a leading rival brand, was primarily distributed in the country’s most affluent areas, he set his sights on those in the second and third-tier cities and towns.

Roadblock

Although the product had some initial success in Ahmedabad in the early 1980s, it had a more challenging time finding retailers. Since consumers were unfamiliar with the detergent, shops hesitated to stock it.

To increase his business, Karsan Bhai started selling Nirma powder to the shopkeepers on credit, but when it came to giving money, the shopkeepers used to make excuses. In such a situation, selling Nirma washing powder on credit for Karsan Bhai became a loss-making deal, after which Karsan Bhai ordered his team to bring back all the Nirma packets in the shops. It resulted in delayed payments, inventory returns, and high losses for the company.

Karsan Bhai hoped to increase sales by offering credit sales of Nirma powder to local merchants, but when it came time for the merchants to pay up, they always had an excuse. The losses on account of credit prompted him to seek the return of all unsold packets from retail outlets. Due to this, payments were late, inventory had to be returned, and the firm lost a lot of money.

Advertising

Karsan Bhai had another plan in the works, eventually leading to Nirma’s fame.

Karsanbhai Patel devised an effective advertising campaign and went on TV to combat the crisis. The advertising agency Purnima was responsible for Nirma’s catchy slogan, “Washing Powder Nirma. Washing Powder Nirma. Doodh se safedi Nirma se aaye, Rangeen kapda bhi khil khil jaye. Sabki pasand Nirma. Washing Powder Nirma.” Soon, customers began to see the company and its products in a new light. Nirma’s popularity soon skyrocketed.

In the 1980s, when demand for Nirma detergent was very high due to advertising, the manufacturer temporarily pulled most of its supply off shelves.

In 1985, Nirma surpassed Surf as India’s most popular detergent.

Nirma owned 60% of India’s detergent market by 1988.