MRF: From selling Balloons on the streets to becoming a Tyre Giant
In the year 1946, a young guy named K.M Mammen Mappillai is selling balloons on the streets of Madras. Mammen, who was born into a Christian household in Kerala and has nine other siblings, had no notion that those balloons would be the foundation for his success.
It was a modest business; it was a small manufacturing unit in a shed that used to create toy balloons, which Mammen would load into a bag and sell from street to street.
In 1952, he spotted a foreign firm selling tread rubber to a tyre retreading plant, and that was the turning moment (So, a tread rubber is a rubber in the tyre that makes contact with the road, and tyre retreading is the process of making old tyres re-usable.) He had a thought,
The Starting Point
With all of the money he had accumulated over the years, he decided to invest it all at once in the tread rubber manufacturing industry, which finally gave rise to MRF or Madras Rubber Factory as it is more well known.
This firm grew quickly because it was the only Indian company producing tread rubber, and its competitors were international companies. As a result of its exceptional quality, MRF was on its way to the big league, and within four years it had a 50% market share. Many foreign manufacturers withdrew as a result of this.
Things were going so well that Mammen decided to branch out from merely making tread rubber, and this time he set his sights on tyres!
The year was 1960, and MRF had already established itself as a well-known brand when it came to treading rubber, but manufacturing tyres was a different storey. Mammen had previously managed to drive foreign competition out of the country, but this time they needed help from such companies to set up a tyre manufacturing unit because India was not technologically advanced enough to produce the high-quality tyres that Mammen desired. As a result, the Mansfield Tire & Rubber Company from the United States was brought in as a technical partner.
The tyre manufacturing unit was soon up and running, and work began. The first tyre from the unit was produced in 1961, and MRF launched its first public offering on the Madras Stock Exchange the same year.
Everything was going swimmingly until Mammen realised that the technological collaboration with Mansfield was unsuitable for Indian road conditions.
On the other hand, foreign corporations posed an insurmountable challenge. Multinational tyre manufacturers such as Dunlop, Firestone, and Goodyear controlled the Indian tyre manufacturing business at the time.
These three corporations dominated the industry in terms of pricing, production numbers, and suppliers, as well as providing stiff competition to newcomers.
Dunlop had a huge market share and made it difficult for smaller companies like MRF to enter.
India had just recently acquired independence, and political officials were eager to promote Indian businesses, particularly in the rubber industry, which boosted MRF’s prospects even further. MRF began to compete strongly for government contracts after the government intervened to ensure fair competition.
Also, do you recall how Mansfield Tire & Rubber Company’s tyres were inadequate for Indian road conditions? This challenge was rectified in 1963, when the Rubber Research Center was established at Tiruvottiyur, paving the way for the Tiruvottiyur factory to open.
Decades have passed since a young man named K.M Mammen Mappillai sold balloons on the streets of Madras, and his company, MRF, was inducted into the Hall of Fame in 1963.
The Cut Throat Marketing
MRF was growing in size, and Mammen wanted it to grow even more. Until recently, the firm had remained a B2B player, and it was not particularly strong in OEM when it came to the car sector. OEM stands for an original equipment manufacturer. OEMs are firms in the automobile industry that make things utilised in the manufacturing process of a vehicle. MRF tyres were rarely utilised by OEMs. Mammen just had one opportunity at becoming bigger, and that was in the retail market, which included us.
Mammen wanted to be the top player in replacement demand, which means that when a store replaced a tyre, they picked nothing but MRF as a replacement, and in order to do so, he had to let people know what MRF was, and the firm had to connect with the public.
Alyque Padamsee was brought in to help with this. At the time, he was the Marketing rockstar. Also known as the God who altered the course of Indian advertising. Padamsee began interviewing other truck drivers. Who said a tyre had to be robust and powerful? As a result, the identity of MRF tyres should be something strong and powerful, which gave rise to the MRF MuscleMan in 1964, symbolising the company’s tyre’s strength. Muscleman was utilised in TV advertising and billboards, so people could connect to and identify it.
What Happened Next?
Mammen had already made a name for itself in India’s retail tyre industry in the 1960s, and now was the time to expand internationally. Previously dominated by US multinationals such as Dunlop and Goodyear, MRF became the first Indian manufacturer to sell tyres to the United States in 1967. By the early 1970s, the business had established a number of factories around India. MRF was the first business in India to commercially manufacture and commercialise Nylon passenger vehicle tyres in 1973.
Moving forward to the 1980s, MRF began to dabble in sports by establishing the MRF pace foundation and supporting the MRF world series event in India.
Do you recall the cricket bat with the initials MRF on it? Each of them, from Tendulkar to Dhoni, has made the bat famous. To be honest, we all assumed MRF was a cricket bat manufacturing firm at one time.
These bats continue to captivate young boys, and the corporation is well aware of this. When the boys are young and excited about cricket, they want a bat with ‘MRF’ written on it, but when they become older, they want a bike tyre with ‘MRF’ written on it. So, in a manner, MRF marketing targets guys from a very young age through the bats. Smart?
Not just cricket, but the firm also introduced the first boxing championship to India, with 39 countries competing. MRF began producing F3 racing cars in the late 1990s.
So many activities under the umbrella of sports, right? Like an MRF tyre, it represents strength and power. Who would have guessed that a basic tyre could be branded in such a manner that people could relate to it?
By 1997, MRF’s first tyre store had opened. Fast forward to 2007, when MRF achieved a $1 billion profit, followed by a $2 billion profit in 2011. The list is endless.
Rags to Riches
The man behind it, KM Mammen Mappillai, would never have imagined when strolling the streets of Madras that he would build an empire so huge that it would become one of the world’s greatest tyre firms; his legacy will live on for generations to come, and it all began with selling balloons! He served as Chairman of the Board and Managing Director of MRF for many years until passing away in 2003, leaving behind a wonderful legacy and a real storey of rags to riches.