Oligopoly: Market Form Market Industry Monopoly Greek Strategic Planning

OLIGOPOLY
An oligopoly is a market form in which a market or industry is dominated by a small

number of sellers (oligopolists). The word is derived, by analogy with "monopoly", from
the Greek "to sell". Because there are few sellers, each oligopolist is likely to be aware of
the actions of the others. The decisions of one firm influence, and are influenced by, the
decisions of other firms. Strategic planning by oligopolists needs to take into account the
likely responses of the other market participants.
INTRODUCTION
Parle-G or Parle Glucose
 The biscuits manufactured by Parle Products Pvt Ltd, are one of the most
popular biscuits in India.
 Parle-G is one of the oldest brand names as well as the largest selling brand of biscuits
in India.
 For decades, the product was instantly recognized by its iconic white and yellow wax
paper wrapper with the depiction of a young girl on the front. Counterfeit companies
have attempted to recreate and sell lower quality products of similar names with virtually
identical package design.
 The company's slogan is G means Genius. The name, "Parle-G", is derived from the
name of the suburban rail station, Vile Parle which in turn is based on village Parle in
olden days (there is also area called Irle nearby where the Parle Agro production factory
is based).
 This popular biscuit is primarily eaten as a tea-time snack.
 Parle-G is the largest selling biscuit in the world. It has a 70% market share in India in
the glucose biscuit category followed by Britannia, Tiger (17-18%) and ITC's Sunfeast
(8-9%). The brand is estimated to be worth over Rs 2,000 crore (Rs 20 billion), and
contributes more than 50 per cent of the company's turnover (Parle Products is an
unlisted company and its executives are not comfortable disclosing exact numbers).
Britannia Industries Limited
 An Indian company based in Bangalore that is famous for its Britannia and Tiger brands
biscuit, which are highly recognised throughout the country.
 Britannia is one of India’s leading biscuit firms, with an estimated 38% market share.
 The Company's principal activity is the manufacture and sale of biscuits, bread, rusk,
cakes and dairy products.
 Between 1998 and 2001, the company's sales grew at a compound annual rate of 16
per cent against the market, and operating profits reached 18 per cent. More recently,
the company has been growing at 27 per cent a year, compared to the industry's growth
rate of 20 per cent. At present, 90 per cent of Britannia’s annual revenue
of Rs2,200 crore comes from biscuits.
Biscuit Industry: India
Overview:
 The total production of biscuits in India is estimated to be around 30 lakh MT,

the organized sector accounts for 65% and the unorganized sector accounts for
35% of the total industry volume.
 The organized sector is valued at above Rs 8000 crores.
 The biscuit industry is estimated to grow over 15-17% in the next few years.
 The per capita consumption of biscuits in India is 2.0 kg.
 India is ranked 3rd after US and China amongst the global biscuits producers.
 The imports are not significant amount as compared to the total consumption.
 The penetration of biscuits in urban and rural market is 85% and 55%
respectively.
 The Biscuit industry employs almost 3.5 lakh people directly and 30 lakh
people indirectly.
The organized biscuit manufacturing industries annual production
2003- 2004- 2005- 2006- 2007- 2008-

Year
04 05 06 07 08 09
Annual Production(Lakh 11.00 12.54 14.29 16.14 17.14 19.5
MT)
Main Categories of Biscuits : Glucose, Marie, Sweet, Salty, Cream & Milk.
Glucose biscuits accounts for more than 50% of the total biscuit market value,
Parle G dominate this market with more than 60% share followed by Britannia and
ITC.
Consumption Pattern across Various Regions
2009 – New Prospects in the Indian Biscuit Industry

 PepsiCo India Launched biscuit brand Aliva, it will be produced by food
division Frito Lay India.
 United Biscuits (UK), world’s third largest biscuit company, is set to enter India
market.
 Shakti Bhog plans to enter biscuits segment.
MAJOR PLAYERS
 Britannia Industries Ltd. : Net sales for FY 2008-09 are Rs 3,112.2 Cr.
For FY 07-08 biscuits recorded sales of Rs. 2,329.9 Cr.
Key Products Tiger, Good Day, Bourbon, 50-50, Treat, Milk Bikis, Marie Gold,
NutriChoice, Timepass, Little Hearts
 Parle Products Pvt. Ltd : Established In 1929, company has factories in

Mumbai, Bangalore, Bahadurgarh in Haryana and Neemrana in Rajasthan,
Additionally, Parle Products also has 7 manufacturing units and 51 manufacturing
units on contract. Company has about approximate market share of 30-35% of the
total biscuit market. Parle-G accounts for the major volume turnover it accounts for
approximately 80% of the total biscuit tonnage for the company.
Key Products : Parle - G , Hide and Seek ,Krackjack ,Hide & Seek Milano ,Magix
,Digestive Marie ,Monaco ,Parle Marie ,Kreams ,Milk Shakti ,Parle 20-20 Cookies
,Golden arcs ,Nimkin ,Kreams Gold ,Chox ,Monaco Jeera
 Surya Food & Agro Ltd : Manufacturing & selling of biscuits under brand
“Priyagold”. Company has three plants located in Greater Noida, Lucknow &
Surat. They also outsource some of our requirements to another plant located in
Hyderabad. Capacities have reached 1, 50,000 MT p.a.
Key Products : Classic Cream , Butter Bite ,Kids Cream ,Bourbon ,Big Boss
,Marie Lite ,Magic Gold ,CNC ,Cheese Cracker ,Snacks Zig Zag ,Don ,Coconut
Crunch ,Cheez Bit Classic Salt ,Chatpata
 Anmol Biscuits Ltd : Anmol is a popular brand of eastern & northern

region, having manufacturing facilities in W.B & U.P.
Key Products : Lemon Mazaa , Funfill Choco Vanilla , Yummy - Milk Cream ,
Tip Top Kajoo Kurkure Masala, Coconutty , Thin Arrowroot , Marie,2 in 1, Butter
Bake , Cream Cracker , Dil Khush , Dream Lite , E-Time , Funfill Orange , Funfill
Rich Chocolate ,Golmol ,Jadoo ,Marie Time , Snackles ,Milk Made
THE MARKETING STRENGTH/structure
Marketing Analysis of PARLE

 The extensive distribution network, built over the years, is a major strength
for Parle Products.
 Parle biscuits & sweets are available to consumers, even in the most remote
places and in the smallest of villages with a population of just 500.
 Parle has nearly 1,500 wholesalers, catering to 4,25,000 retail outlets
directly or indirectly.
 A two hundred strong dedicated field force services these wholesalers &
retailers.
 Additionally, there are 31 depots and C&F agents supplying goods to the
wide distribution network.
 The Parle marketing philosophy emphasizes catering to the masses.
 They constantly endeavor at designing products that provide nutrition & fun
tot he common man.
 Most Parle offerings are in the low & mid-range price segments.
 This is based on their understanding of the Indian consumer psyche.
 The value-for-money positioning helps generate large sales volumes forthe
products.
Pattern of market segmentation

 If we divide the whole market on basis of their preferences foe sweetness
and saltiness in the biscuits then the possible outcome would be that the
preferences are clustered near some tastes
 i.e. the consumers would not like to have something really vague like
50%salty, 25%sweet and25%creamy.That is why the preferences are
clustered and not diffused wherein the preferences have to be very extreme
and vague.
 Parle as a company makes use of this clustered preferences and
manufactures biscuits for each and every cluster.
 For e.g. Monaco for entirely salty biscuits and its latest product Krack jack-
cream is for sweet and salty taste.
Market Strategy of PARLE
PARLE Company as a whole inculcates SELECTIVE MARKET
SPECIALIZATION strategy.
Target Marketing:
Segmentation reveals only the firm’s opportunities. The firm now has to Evaluate
the various segments and decide how many and which segments it can best serve.
Evaluating Market Segments:

A firm must look at three factors to evaluate market segments: segment size and
growth; segment structural attractiveness; and company objectives and resources.
The company must first collect and analyze data on current segment sales, growth
rates, and expected profitability for various segments.It will be interested in
segments that have the right size and growth characteristics. But “right size and
growth” is a relative matter.
There are several structural characteristics that affect long-run segment

attractiveness:
 The segment is less attractive if there are several strong, aggressive
competitors.
 The existence of many actual or potential substitute products may limit prices
and the profits that can be earned.
 The relative power of buyers also affects segment attractiveness.
 A segment may be less attractive if it contains powerful suppliers who can
control prices or reduce the quality or quantity of ordered goods and services.
 The company must take into account its own objectives and resources in
relation to the segment.
 If a segment does not mesh with the company’s long-run objectives, it can be
dismissed.
 The company must take into consideration whether it has the skills and
resources needed to succeed in the market.
 The company should enter only segments in which it can offer superior value
and gain advantage over competitors.
Selecting Target Market Segments

A target market consists of a set of buyers who share common needs or
characteristics that the company decides to serve.
THE STRENGTH OF THE BRAND

 Over the years, Parle has grown to become a multi-million US Dollar
company.
 Many of the Parle products - biscuits or confectionaries, are market
leaders in their category and have won acclaim at the Monde
Selection, since 1971.
 Today, Parle enjoys a 40% share of the total biscuit market and a 15%
share of the total confectionary market, in India.
 The Parle Biscuit brands, such as, Parle-G, Monaco and Krackjack
and confectionery brands, such as, Melody, Poppins, Mangobite and
Kismi, enjoy a strong imagery and appeal amongst consumers.
 Be it a big city or a remote village of India, the Parle name symbolizes
quality, health and great taste! And yet, we know that this reputation
has been built, by constantly innovating and catering to new tastes.
 This can be seen by the success of new brands, such as, Hide & Seek,
or the single twist wrapping of Mango bite.
PARLE VS BRITANNIA
Description Britannia Parle

Established 1896 1929
Nature of business Public ltd Family run business
No of manufacturing 5 own ,40CMU 8 own units ,60 CMU

units
Market share ( value) 32.80% 32.94%
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OLIGOPOLY

An oligopoly is a market form in which a market or industry is dominated by a small

 This popular biscuit is primarily eaten as a tea-time snack.

Biscuit Industry: India

 The total production of biscuits in India is estimated to be around 30 lakh MT,

The organized biscuit manufacturing industries annual production

2003- 2004- 2005- 2006- 2007- 2008-

Consumption Pattern across Various Regions

2009 – New Prospects in the Indian Biscuit Industry

 Parle Products Pvt. Ltd : Established In 1929, company has factories in

 Anmol Biscuits Ltd : Anmol is a popular brand of eastern & northern

THE MARKETING STRENGTH/structure

Marketing Analysis of PARLE

Pattern of market segmentation

Evaluating Market Segments:

There are several structural characteristics that affect long-run segment

Selecting Target Market Segments

THE STRENGTH OF THE BRAND

Description Britannia Parle

No of manufacturing 5 own ,40CMU 8 own units ,60 CMU

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