How Surf Excel beat Ariel

Surf Excel, a popular detergent brand from market leader Hindustan Unilever (HUL), has grown to be a $1 billion brand in terms of annual sales. According to Unilever’s Mumbai-based local subsidiary, the brand booked Rs 8,200 crore in sales during the calendar year 2022, trying to make it HUL’s first billion-dollar brand.

While Surf Excel has dominated the local market for years, its path to that position has not been easy. It is the result of decades of playing nimble and masterfully fending off severe challenges.

Originally launched as Surf by Unilever in the late 1950s, the now-iconic brand was aimed at housewives from middle-income households in developed markets such as the United States and Europe. Surf was a premium brand in India from its inception, at a time when the majority of housewives were used to cheaper bar soaps. However, the greatest threat came from somewhere else, in a different form. Nirma, a modest small-scale Gujarati brand, shook the boat violently.

When chemist Karsanbhai Patel launched Nirma in the 1970s at a 75% discount compared to competing products from multinationals like HUL (then Hindustan Unilever Ltd.), it quickly emerged as a major challenger. By the 1980s, Nirma had surpassed all other brands, including HLL’s, to become India’s largest detergent brand.

Surf Excel

Surf Excel encountered such difficulties several times during its long journey. Surf Excel has had to concede its supremacy to new competition, whether it was Ariel from rival Procter & Gamble (P&G) in the 1990s or another local player Ghadi Detergent in 2015, only to emerge stronger and reclaim the top spot.

HUL’s MD and CEO, Sanjiv Mehta, previously told Business Today that the company’s goal is to constantly premiumize its portfolio, particularly in the fabric wash products category. “In terms of premiumization, we are now significantly over-indexed to the market,” Mehta recently stated in a post-earnings call this month.

“Our premium products, whether liquids or premium powders, have grown quite well. And the total portion of our business in the portfolio is now over-indexed to fluids and premium assets versus mass assets,” said Ritesh Tiwari, Chief Financial Officer, HUL, during the call. Adding HUL’s product mix “keeps altering the way we drive new markets for driving premiumisation”.

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