How Parle-G Biscuit Shows Purchasing Power Of India’s Bottom Pyramid Arab

Apparently, Ramvva’s mother did not breastfeed him, but fed him only Parle-G biscuits and cow’s milk since birth. Even after growing up, the girl refused to eat anything else. Her poverty-stricken parents, who could not afford the six or seven packets she ate a day, tried to switch her to other foods, but were unsuccessful. Nutrition researchers found her to be essentially healthy but somewhat underdeveloped for her age.

Ramavva is perhaps an extreme case, but millions of fanatical consumers like him – mostly from India’s often-neglected lower pyramid market – are the reason why Parle-G – a basic flour-and-sugar biscuit is sold in packs. as 2 – has become the largest biscuit brand by volume in the world and has transformed its maker, Parle Products, into a $2 billion-in-revenue company.

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That’s right, two billion dollars. Nearly a century-old maker of biscuits and snacks reports net sales 16,202 crore for the year ending March 31, 2022, according to a filing with the Registrar of Companies (Parle Products is not a listed company). It was a healthy 9 percent higher than sales 14,923 crore it had logged in FY21.

Not bad for a company that isn’t exactly the market leader in terms of value in India – rival Britannia is a shade ahead. But while Britannia gets its volume – and market share – from high-priced cookies catering to the urban middle class, Parle is focusing on the mass market and its most affordable product. Result: While Britannia has more than double the market share of Parle in the high-priced range, Parle has 85 per cent market share in the basic glucose biscuit category.

It has also managed to hang onto the “magic price point” of – despite inflation 5 per pack for close to three decades. The price of its most popular pack- Parle-G’s 5 pack – has remained unchanged since 1994. However, the weight of the pack has dropped dramatically. In 1994, the The weight of 5 packs was 100 grams. Today its weight is only 55 grams. But affordability is important for India’s poor. This is the reason why Parle-G 5 pack and haldiram 5 bhujia packs have helped both of them become billion-dollar brands in India.

Parle-G’s success is also a testimony to the collective purchasing power of India’s poor. According to the United Nations data, based on 2020 population data, India has the largest number of poor people (228.9 million) in the world. More than 90 percent of them live in rural India. And this is where Parle-G sells most of its biscuits. Biscuits have an astonishing 83 percent penetration in rural India and over 94 percent in urban India, making biscuits the largest FMCG category in India.

This strong rural connect has helped Parle-G maintain itself at the top of the charts for India’s “most chosen” brands for more than a decade, beating out another household food giant, Amul. According to Kantar Worldpanel’s Brand Footprint study, Parle-G occupied the top spot as the most chosen brand based on its estimation of consumer touch points – a composite metric that combines how many households are buying a brand (penetration) and how often (frequency of purchase). At the top with 6,531 million CRP, followed by Amul with 5,561 million, its easy availability even in remote markets, its affordable price and above all, its ability to maintain consistency in taste and quality, is one of the key factors in longevity of any food brand. important for.

This, more than anything else, underscores the real potential at the bottom of the pyramid in India. Income poverty is an obvious barrier to consumption – but that doesn’t mean the poor consume nothing. If brands can get the ‘three Ps’ of marketing right – product, price and placement – ​​there is still fortune waiting to be made at the bottom of the pyramid.

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