Ivey Publishing

Product Details

Product Number:
Publication Date:
16 pages (9 pages of text)
Product Type:
Case (Field)
In 2009, Parle Products Pvt. Limited (Parle), a leading Indian biscuit manufacturer, had the distinction of producing the largest selling glucose biscuit brand by volume in the world, the Parle-G. Parle-G biscuits sold for approximately US$1 per kilogram and as very few processed and ready-to-eat foods were available at this price point, Parle-G was strongly associated with offering value for money (VFM). A looming problem in this brand category for Parle was that the input prices of two major raw materials for the Parle-G biscuits (which together accounted for 55 per cent of their input costs) had risen enough in the past 18 months to decrease margins from 15 per cent to less than 10 per cent. Pressure to restore margins led Parle to consider a price increase yet a previous attempt had caused dramatic reduction in sales. Parle subsequently addressed rising input costs by reducing the weight of the package, franchising production, reducing supply chain costs and reducing packaging costs. Parle could not ignore the deeply entrenched perception of VFM when devising both short- and long-term marketing plans to retain Parle-G's success in the marketplace. These plans needed to address segmentation, positioning and changing Indian demographics when considering a potential price increase for Parle-G biscuits.
Learning Objective:
This case exposes students to the strategic complexities underlying a major pricing decision. The major learning objectives are as follows:
  • To enable students to appreciate that tactical decisions such as pricing are not made (or, at least, are not made effectively) in isolation of bigger picture marketing strategy
  • To encourage students to explore the challenges surrounding the sustainability of a value-for-money positioning
  • To provide students with the opportunity to devise both short- and long-term marketing plans
International,  Marketing
India, Large, 2009
Intended Audience:
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