An FMCG company that has made its presence known in all parts of the country
Amongst the many food combinations that have stood the test of time, chai and Parle G remain one of the most loved. Termed “the common man’s biscuit” the brand has withstood geographical barriers and made its presence significant in every corner of the country. The nostalgia of every ‘90s kid, Parle, a company that was started in 1929, remains as relevant as it used to be 93 years ago.
How is Parle related to the Swadeshi Movement?
Mohanlal Dayal, hailing from a family of Mumbai-based silk traders, was deeply influenced by the Swadeshi Movement, which called for the promotion of Indian-made goods and products. He sailed to Germany to learn the art of confectionery making and came back with both skills and machinery. An old factory located between Irla and Parla in Mumbai was bought and set up in 1929 with just 12 employees, (most of them from his own family) who served in different capacities as engineers, managers, and confectionery makers.
Amidst the daily struggle of managing the factory, it is said that the managers forgot to name the company, and it was finally named after its place of birth, Parle. It is a little-known fact that Parle’s first product was actually orange candy, which was followed by other toffees and confectioneries. The biscuit operations only began a decade later in 1939.
At that time, biscuits were considered an extravagance that was usually imported and consumed almost solely by the elite. Huntly & Palmers, Britannia, and United Biscuits were some of the popular British brands in the market. To counter this notion, Parle released Parle Gluco as an affordable source of nourishment for the common people. Meant for Indian palettes and made accessible to all areas, this biscuit gained popularity quickly. This biscuit was also much demanded by the British-Indian soldiers during World War II.
Who is the girl on the cover of the Parle G packets?
Following Independence and the partition, India suffered a huge shortage of wheat due to which Parle had to stop production of its most popular product in 1947. Despite their hardships, they put out an ad saluting the Indian soldiers and urging their consumers to compensate with barley biscuits until the normal wheat supply was restored.
By the 60s, there were other players such as Britannia that entered the market with their own variety of glucose biscuits and Parle began to feel the competition. Confused by multiple brands, consumers would just ask shopkeepers for ‘glucose biscuits’ which resulted in Parle losing out on a lot of potential sales.
To counter this confusion, Parle launched a new packaging that was a yellow wax paper wrapper on which there was an image of their biscuit and their brand name, along with the image of a girl. There has been a lot of contention about the identity of the girl with names like Neera Deshpande and Sudha Murthy being tossed around; however, the girl is a mere illustration created by Everest Brand Solutions.
However, this packaging did not help them distinguish themselves from the host of other glucose brands. Finally, in 1982, they changed their packaging material to low-cost printed plastic to avoid duplication. Parle Gluco was rebranded as Parle G. Parle products finally carved a unique identity for themselves, along with a cheeky tagline “Often imitated, never equaled”.
In the meantime, Parle had widened its portfolio and released a slew of other biscuit brands and confectioneries that are still a staple part of every grocery store today. The famous Monaco cracker was released in the 1940s, followed by Cheeslings in 1956 and Krackjack in 1974. In the confectioneries segment, Kismi and Poppins were introduced in the 1960s, and Melody and Mango Bite in the 1980s. All these products were united in their mass appeal, especially targeting children.
In 1996, the company entered the premium segment with Hide & Seek. This segment was further widened by the introduction of Nutricrunch and Milano, a range that was later rebranded as their ‘Platina Range’. The products in this segment were soon marketed without the Parle brand name, as the name was synonymous with a mass brand.
Indians are compulsive snackers, and extending into that industry was a natural progression. Although a late entrant in 2008, a time when players like Pepsico, Haldirams, and Balaji wafers enjoyed high market share, Parle approached the segment differently. They zeroed in on smaller towns and villages with a high-volume, low-cost strategy. At the time, for Rs.5, a pack of Parle Wafers contained 15.6gms of chips while Lays only had 12.5gms of chips for the same price.
As of 2022, Parle has 200+ products in its portfolio spanning the snack, cake, biscuit, rusk, confectioneries, Platina, atta, and cereal segment.
In the last 28 years, Parle G’s price has only been hiked by 1 rupee
In 1994, a small packet of Parle G cost Rs.4. In 2021, it was hiked by all of 1 rupee to get to Rs.5 per small packet. How are they managing to stay profitable? A major psychological hack was employed to pull this off. Instead of incrementally increasing the prices, they slowly reduced the portion size over time while still maintaining the ‘small packet’ perception.
In 1994, a packet that held 100gms of biscuit was reduced to 92.5gms, then 88gms, and now the Rs.5 packet weighs 55gms. This technique called graceful degradation is one that is employed by chips, toothpaste, and chocolate companies, where the changes are so minute that the customers don’t realize it. Parle has managed to reduce its packet size by 45% without inciting complaints. At their price point, the price of the product becomes more important than its weight.
Unlike the trajectory of most companies, Parle clocked its best growth during the lockdown
In 2013, Parle became the first FMCG brand in India to cross the Rs.5000cr mark in retail sales. However, it was during the lockdown in 2020 that Parle made its highest sales. Parle saw its overall market share increasing by nearly 5% in May and 80-90% of this growth came from Parle-G sales.
During natural calamities and emergencies, when there is an urgent need for food rations, Parle G is known to be the go-to comfort food. “It has a longer shelf life and the packaging keeps the biscuits fresh, thereby making it an ideal storage item,” said Mayank Shah, Sr. Category Head, Parle Products. Various NGOs include Parle G in their donation kits and many people even stocked it in their homes for emergencies.
From ‘G Maane Genius’ to ‘Melody Itni Chocolatey Kyun Hai’ Parle has released a lot of well-loved ads throughout the years
Over the years, Parle products have managed to carve a niche for themselves in the content and advertising space, with each brand owning a unique identity. It’s impossible to say ‘Melody’ without following it up with ‘itni chocolatey kyun hai’. Similarly, Hide and Seek with its ‘innocent love’ appeal, Parle G and ‘G maane Genius’, and Monaco’s witty ad films, it is impossible for an average consumer to identify that all these brands belong to the same company. Each of these brands has revived its messaging with changing times while staying strong in its positioning, which is why consumers still remember these ad films so fondly even today.
Pre-pandemic, their budget for digital was just 12% of their total ad spends, however currently they spend close to 25% on digital, aiming to communicate their message through digital channels as well. In 2020, Parle launched a co-branded video on Amazon Prime Video in partnership with the film ‘Shakuntala Devi’, to build a stronger association with the ‘Genius’ in Parle G.
When it comes to diversification, for Parle, the sky’s the limit
In an interview in 2018, Mayank Shah, Category Head, Parle Products said, “If you look at Parle as a company, we have always been known for biscuits and confectionery. But we have got into quite a few categories over the last two years. We have entered into the bakery items segment like cakes and rusk, high-end chocolates, snacks, and of late into pulses. So, I think now is the time to consolidate before we move forward and get into new categories.”
At a time when a lot of segments are moving from unorganized to organized segments, one category that is set to grow starkly is pulses. To fill the gaps in their offerings, Parle has launched a new brand, Fresh Harvest that offers numerous types of dal. Although they are focusing on Karnataka and Maharashtra at the moment, they hope to expand in the coming years.
Parle Products has remained a privately owned company after all these years, which is an ode to their calculated business decisions, whether it be their advertising tone or entering a new segment. By diversifying their offerings, they’ve managed to capture the length and breadth of Indian consumers. While the company is moving full steam ahead and aiming for a 20,000 crore turnover by 2024, all we can do is raise a glass of cutting chai and a Parle G to its continued success.