Emami at 50: A tale of two Radhey Shyams, their families and one successful business

Founded in 1974 by two childhood friends, Radhey Shyam Agarwal and Radhey Shyam Goenka, chartered accountants by profession who left cushy corporate jobs to start their own business with an initial capital of INR 20,000. The company began manufacturing personal care products and Ayurvedic medicines under the brand name of Emami from a small office in Kolkata.

It subsequently went on to launch brands such as BoroPlus antiseptic cream and Navratna Cool oil in the 80s and 90s, clashing head-on with industry heavyweights like Hindustan Unilever.

Over the years, the INR 3,400 crore FMCG company acquired a slew of businesses, including Zandu Pharmaceuticals, and the hair and scalp care brand of ‘Kesh King’. Its latest acquisition was Dermicool, a leading brand in the talc category in March 2022 from Reckitt for INR 432 crores.

Having diversified its business interests across various sectors, including personal care and healthcare products, edible oil and branded foods, paper, real estate, retail and contemporary art, among others, the conglomerate, now into its fifth decade of operations in India, boasts a portfolio of around 300 products, including brands like Fair and Handsome, Zandu Balm, Mentho Plus Balm, and Sona Chandi Chyawanprash, to name a few with a presence in over 70 countries.

In February of 2022, the Emami founder-duo of RS Agarwal and RS Goenka, stepped down to make way for its next generation of scions to take charge of the 50-year-old packaged consumer goods company.

In an in-depth interaction on the sidelines of the conclave to celebrate the group’s 50-years’ milestone, directors Aditya V Agarwal and Manish Goenka, reflected on the company’s journey so far under the stewardship of their respective fathers, while deliberating on its plans for the future.

Staying relevant - The early days

Agarwal and Goenka shared how their fathers realised early on that the only way to survive and grow in an industry occupied by multinationals would be through innovation and the introduction of new products.

“In a first for the Indian FMCG industry of the time, we introduced products with imported French perfume and innovative packaging in plastic containers (as against tin, which was prevalent in those days) with imported Japanese labels that had golden motifs and printing,” says Goenka.

The strategy paid off and soon enough both of its early products - Emami vanishing cream and talcum powder - became popular.

So much so that by 1978, Emami’s vanishing cream became the market leader with a 22% market share and its talcum powder became the number two brand in its category in India.

Highlighting the importance of evolving with the times, Agarwal added, “It is a continuous process and this has been a part of our working process. In these 50 years, we have always kept on changing and that is why we are here. Otherwise, we would have become irrelevant like many brands and companies that have not changed in the last 50 years or those who have not believed in changing over a period of time.”

He added, “There is a process to it, where our packaging keeps on changing every three to five years, where our advertisement changes every one to two years. There is a process where we connect with our consumers regularly, if not daily, wherein we go to the market, do consumer household surveys personally etc. by which we learn how the new consumer is thinking.”

Agarwal specified that to keep renewing itself, it is sometimes important to make the consumer think their way by hand-holding them to bring them to the brand.

“We also go to foreign countries to check out the latest products and the new categories available there,” he added.

"And when a product is made for new consumers, the marketing also has to reach them otherwise it will not be successful," he cautioned, adding that even for their existing products, consumer preferences keep changing, so they value-add constantly depending on the market.



Manish Goenka: In a first for the Indian FMCG industry of the time, we introduced products with imported French perfume and innovative packaging in plastic containers (as against tin,

which was prevalent in those days) with imported Japanese labels that had golden motifs and printing

The fairness cream wars

Talking about the company’s foray into fairness creams in 2005 with Fair & Handsome, the director duo reiterated the group’s business strategy over the years: of continuous ideation, innovation, building on the right opportunity and timely execution.

“There was a time when fairness creams were considered to be meant for women only and our peers and others never thought that men might also desire to look 'fair',” said Goenka, voicing the general perception prevalent among Indians back then.

Even multinational companies did not pay attention to this latent but prevalent need, he noted.

Hindustan Unilever introduced its brand of skin-lightening cosmetic product, then called ‘Fair and Lovely’, to the Indian market in 1975, establishing its dominance over the market.

Emami discovered through market research that men were frequent users of fairness cream, albeit closet users. This led to the brand launching ‘Fair and Handsome’ in 2005, creating the men's fairness category in India.

HUL followed it up soon after with its range of fairness creams for men in 2006 to specifically target the men's segment by launching 'Fair & Lovely, Men'.

Since then, HUL has renamed its whitening products as 'Glow & Lovely', in its bid towards a ‘more inclusive vision of positive beauty.’

However, all’s not so ‘fair’ in the fairness cream category. HUL also changed the name of its men’s range to ‘Glow & Handsome’ in 2020, sparking a sharp response from its rival.

Terming HUL’s move as an ‘unfair business practice’, Emami launched a legal suit against the FMCG giant claiming trademark violation. The matter is yet to resolve with the case still ongoing in the court of law, confirmed Goenka.

With consumers today being more particular about a brand’s messaging and authenticity, we asked the directors whether the brand has any intention of rebranding its cream.

“I don't see any reason to rebrand it,” states Agarwal. “This is again nothing but hypocrisy if you are going to call a cream by some other name but the underlying product remains the same.”

“Why be a party to perpetuating falsehood, when one can be upfront about the truth? And how is it going to be any different by replacing the term ‘fairness’ with ‘whitening’?” he asks.

“If someone has the desire to lighten their complexion, what’s the harm in it,” Goenka pitches in, adding that ultimately it’s a matter of consumer choice. He also underlines that the group’s policy on the matter could change with time, for they believe in ‘keeping an open mind to change’.

Agarwal cites the example of edible mustard oil - one of the group’s flagship products to drive his point. “We use mustard oil in this part of the country and the most important aspect of it is the pungency. But none of the other brands mention the pungency level, they increase or reduce it, depending upon the availability of the raw material or the cost of the raw material.”

The group started a social cost campaign, ‘the right to know’ so that the consumers know what they're using.

“We have started mentioning our pungency levels on our packs. And we have given them a right to choose also by launching three types at three different levels -very high, strong and then there's a mild one.”

Hence, he adds, “I believe the consumer does not necessarily want to hear what they want to hear. They are more interested to know the truth.”

A tale of two Radhey Shyams

Emami is not one business family, but two. Even as three generations of two separate families- the Agarwals and the Goenkas- run it, governance becomes a bigger challenge than it typically is for single-family businesses. How did the two founding patriarchs ensure a smooth resolution to every conflict?

“My father (RS Goenka) always said that every individual connected to the group must be given a chance to voice their opinion regardless of who it may be,” said Goenka.

“He believed in the principle of ‘matbhed ho sakta hain, par man bhed na ho’ which loosely translates into ‘we may have a difference of opinion but there should never be a distance between our minds and hearts after any discussion’. And that is what each one of us follows and strives for, including our third generation.”

Both the Radheshyams - Goenka and Agarwal - feature among the top Forbes 50 billionaires of India.

“Today, we are a homegrown multi-national company with a presence in over 70 countries, supported by a strong workforce of 20,000+. But what is more satisfying as the second-generation promoter directors from our two families gear up to take this group to the next level,” says Goenka, “is the fact that over the last 40 years, we did not have a single day of labour unrest.”

He credits this fact wholeheartedly to the foresighted vision of the founding fathers.

“I remember as a child we used to have town halls once every year before the word became popular in corporate jargon. Here every worker or employee was encouraged to voice their grievances or complaints directly to the founders, without having to take the aid of any union leader,” recalls Goenka.

Evolving with the times – the digital drive

Agarwal explained Emami's stance on adapting to changing consumer sentiments and the evolving digital marketing landscape.

To connect better with the ‘digital natives’, the Gen Zs and the millennial generation, the brand spokesperson reveals, that while two years ago digital media would have had a very small share of 1 to 2%, or nothing in the brand’s media plan as against traditional media, today it is around 10 to 15% in most cases, or even 20%.

“We have a policy to ‘catch them young’. How we do that is we keep doing things that make us visible to them. Towards this end, we have experimented with influencer marketing, wherein along with the big stars we have had several mid-sized, micro as well as nano, hyper-local influencers,” says Agarwal.

One more thing which is very important, he adds, however, is how much ever we think that society and people want new things, some things don't change.

Market share

Disclosing the present market share for its flagship personal care products, Agarwal says, “Some of the brands like Boro Plus have a market share of more than 60%, Mentho Plus balm and Zandu balm combined, will have a market share of more than 75%. Navratna oil would have a market share of more than 70%, while Fair & Handsome has a market share of more than 60%, and for the prickly heat or cool powder portfolio, the market share will be more than 70%.”

Agarwal is optimistic about the coming future - one reason being the upcoming elections. “Whenever elections are there, we expect increases from the consumer side, because there is more money in their hands! Also, our products are not very highly priced - we are more towards the belly of India.”

Dismissing the notion that the brand enjoys a better market share in the rural regions as against urban, Agarwal says, “Not so much towards the rural sector, but depending upon the brand and category, it will be a 50-50 for rural and urban.”

The Green thrust

Speaking about the group’s vision towards green energy and sustainability initiatives, Agarwal said, “We have a biodiesel plant with a current capacity of 350 tons per day, to which we are adding another 350 tons in February, by converting the byproducts obtained from our edible oil manufacturing.”

By August this year, the group has plans to make it a 1,100 tons per day capacity plant, making it the only producer of biodiesel in Eastern India and the largest in the rest of India, according to Agarwal.

The group was also into solar energy, with around 35 megawatts capacity till it divested out of it pre-Covid. However, all of the group’s plants still function on solar energy, Agarwal stated.

On diversification, acquisition and consolidation

The company has seen a lot of diversification in the last several decades, according to Agarwal. “In the lifespan of every company, there comes a time when you have to consolidate, and then again you spread your wings,” he asserted.

Currently, the group is undergoing a consolidation phase, wherein during the last three to four years, the company has divested two businesses - one is a healthcare business and the other is a cement business.

Having started the cement plant circa 2018, the group sold it off for a good value recently, akin to the startup culture. Agarwal calls it a practice that makes good business sense, despite it being frowned upon in India.

Presently under the consolidation drive, the group is veering towards businesses which are more consumer-facing such as personal healthcare products, food, edible oil and so on, he shares.

On whether this means more acquisitions, Agarwal says, “Emami has grown through a history of acquisitions. We acquired a paper mill, a pharmacy chain, we acquired CRI tips - which was called 'Cash Registers of India', we acquired a cement plant, brands in edible oil and cooling talc, we even acquired sick units. And now we are also investing in startups. So acquisitions will continue.”

The roadmap ahead

Agarwal is not a fan of changing things around merely for the sake of change. He’s non-committal on the changes the second-generation leaders plan to usher in as torch-bearers of the legacy brand.
“I am again a believer. Unfortunately, I see many times, say in an agency, whenever a new creative person or a new account person comes in he/ she tries to bring change. Or even in a company when a new brand manager comes, he tries to change the whole ethos of the brand." Instead, states Agarwal, one must focus on why one really wants to reinvent the wheel.