Sunday, June 19, 2016

Brand Story - Parle G || Daksh Bhagat || IIM Shillong || February 2016 edition

Certain brands truly live up to the age old saying ‘Old is Gold’ owing to their wide popularity amongst the masses. While travelling in a Mumbai local train enroute Andheri and further north, one might encounter the warm aroma of fresh baking. This comes across as a result of the busy ovens at the first factory of Parle Products baking a batch of the world's largest biscuit brand, Parle G. Ever thought of the fact, how is it, that, generation after generation the biscuit that dips in your tea every morning only to give you a refreshing start to the day, has been able to maintain the same standards? Let’s dig a bit deeper into the matter.

Born in 1939, as Parle Gluco and covered with a cream-coloured, yellow stripped, wax-paper wrapper with the photo of a cute girl on it, it was launched as an affordable source of nourishment to counter expensive, imported biscuits in the British Raj such as Jacob’s and Huntly & Palmers. Britannia, based out of Calcutta emerged as a market leader in the East, while, Glaxo glucose biscuits dominated the market in the South. The war between the brands began only in 1960, when, Britannia launched its first Glucose biscuit brand, Glucose D, which was later endorsed by Amjad Khan’s Sholay Avatar Gabbar Singh in the 1970’s.

Similarly, smaller players began to enter the market by just imitating the pack and adding the suffix ‘Glucose’ to their name. Thus, the positioning as a Glucose biscuit started to put Parle in trouble, because the majority would just ask for Glucose biscuits and many businesses began eating into Parle’s market share, using the product’s name. This was the time when people started getting confused by similar brand names, each with its own set of promotional strategies. Glucose biscuits no longer remained an exclusive offering of Parle in the market. It was high time for Parle to differentiate itself from the competitors and rise above all. Hence, in 1982 Parle Gluco was repackaged as Parle G. The plump girl on the packet appropriately clicked with the target audience, kids and their mothers.

In order to create a large potential market, Parle employed mass marketing for Parle G. Mass-production, mass-distribution and mass-promotion allowed Parle to maintain low-price for Parle G, while targeting all segments of the market. Owing to its nutrition-rich and value-for-money positioning, it has been able to generate large volume-sales. Parle G faced severe competition from Hide & Seek, which came out of the same company many years after Parle G, and employed niche marketing strategy to sell its premium biscuits. Other competitors such as Tiger, and Sunfeast also employed the mass marketing technique.

Since the Glucose-biscuit market has reached its maturity stage, Parle changes its conventional marketing strategies and now uses penetrative strategy to cater to this market. It provides low-price and high-quality Parle-G to its price-sensitive customers, using value pricing method. Whereas for Hide & Seek, a premium chocolate-cream biscuit, it follows a market premium strategy and charges high price for its high innovative and quality biscuits. Parle-G, being the flagship product of Parle, is meant for all markets whereas other premium sweet-savoury biscuits, such as Monaco and Hide & Seek, are targeted at specific markets and market segments, especially the price-insensitive high-income class.

Parle is one brand that has always believed in branding. In times of trouble, Parle-G came up with the tagline, ‘Often imitated, never equalled’, to create a difference in the minds of the customers and claim its superiority over its competitors. It brought about a revolution in the advertising industry in trying to get the first mover advantage. With this ideology, Parle partnered with the Indian Railways and painted Mumbai’s train compartments with Parle Gluco ads, becoming the first brand to do so after the Indian government allowed it. It was only the belief in branding that made Parle G’s makers self-reliant, build scale and maintain pricing.

Parle G has always kept pricing in check. Even when the prices of the key ingredients (Vanaspati, sugar and wheat) went up, its price hovered at around Rs 4 for a pack. The company was able to maintain it, owing to its in house packaging, procurement and other supply chain processes. Thus, it has been able to retain its position as the market leader in the Glucose biscuit industry. Glucose is now 22 per cent of Rs 24,000 crore and Parle G is around 80 per cent of it, reaching 6 million outlets. 

With the advent of the new decade, the company now faces a different concern. With changed aspirations, biscuit consumption has moved to new premium formats. Even with increased penetration, Glucose market’s share has declined. Parle Products revamped Parle G with the help of O&M, positioning it as a supplement to the curiosity, which is characteristic of the new generation kids, with the tagline, G for Genius. But it is more important to rejuvenate Parle G to appeal to the new generation. The newer generation needs to be told about the stories that the brand has been able to create with the older generations by including newer perspectives into their stride including their motto: ‘Old is not always Gold’. 


muskaan agarwal said...

Truly Parle-G is one such brand that lives upto the saying "Old is Gold"... Generations have grown up eating those lovely biscuits and the evening chai never tastes the same without our beloved Parle G. The recent brand positioning strategy of a new elite line of biscuits called 'Parle G Gold' has helped it to retain its price point for the standard product while expanding the target audience with the niche brand.

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