In February 2019, a Twitter user from Kerala posted a picture, with the tweet “Dear Parle. Bring this back” . The tweet urged Parle to bring back Rol-a-Cola, a cola-flavoured candy, production and sales of which it had discontinued in 2006. Even though the product was taken off the shelves in India due to product rationalisation, Parle continued to sell it in international markets in Africa and West Asia.
Following 10,000 retweets for the recall of Rol-a-Cola in a month, Parle decided to bring back the iconic brand. As of October 2, 2019, the #BringRolaColaBack campaign had secured more than 0.7 million impressions on Twitter. B Krishna Rao, Senior Category Head at Parle, said that a brand comeback based on consumer demand using social media as a platform was a unique experience in the marketing of Parle products, and that the company was looking forward to achieving sales of 200 tonnes of Rol-a-Cola in the first year of its re-launch. Parle expected to achieve sales of ₹1 billion, accounting for 10 per cent of its overall turnover in the first year of Rol-a-Cola’s re-launch.
By mid-September 2019, Parle had started production and distribution of the candy across stores in India. It planned to reach 0.5 million stores within the first six months of the re-launch of Rol-a-Cola. Krishna Rao observed that even after 13 years, there was space for the brand in the Indian market and they should not have discontinued it in 2006.
Background
The recall of the Rol-a-Cola brand was seen by many analysts as a strategy to offset the losses incurred by Parle because of falling demand for its Parle-G biscuits (Parle-G). Parle-G was launched in 1939 as a low-cost alternative to expensive British biscuits, that were not affordable for the common people in India. Parle-G’s low price (₹5 for a standard pack) and deep reach (available even in the remotest villages) enabled Parle to claim a leadership position in the volume-driven and price-conscious biscuit segment. Even in the mid-1990s, after the launch of Tiger biscuits by Britannia Industries in the low-cost format, Parle did not change its price. According to market research firm Nielsen, Parle-G was the largest selling biscuit brand in the world in 2010.
In 2019, the standard biscuit variants of Parle, which comprised milk and glucose biscuits, saw a 7-8 per cent drop in sales. The company attributed the economic slowdown and the high GST on biscuits to low sales. In August 2019, Parle-G had the worst sales, and the biscuit-maker was mulling options to lay off 10,000 employees.
Confectionery Market in India
The confectionery market in India is valued at around ₹100 billion, with candy occupying 30 per cent of the market. Parle’s share in the confectionery market was around 20-21 per cent and it planned to add 2-5 per cent by 2020 with the re-launch of Rol-a-Cola. The various confectionery brands of Parle were Kismi Range, 2in1 Eclairs, Cafechino, Friberg Range, Mazelo, Londonderry, Poppins, Mango Bite and Orange Bite.
Parle’s competitors in the Indian confectionery market are Mondelez, Mars Wrigley (Mars), and Perfetti Van Melle (Perfetti). Mondelez was the leader with a market share of 66 per cent as of 2019, and its brands include Cadbury, 5-Star, Gems, and Perk. Mars’ brands include Mars chocolate, Bounty, Snickers, Spearmint and Wrigley juicy fruit. Perfetti’s brands are Alpenliebe, Mentos, Chocoliebe Eclairs, Alpenliebe, Juzt Jelly, Centerfresh, and CenterFruit.
Rol-a-Cola 2.0: Old Candy in New Packaging
Parle had launched the Rol-a-Cola candy in the early 1990s, around the same time the Coca Cola beverage was launched in the Indian market, then priced at ₹10 per bottle. As most Indians considered the price of Coca Cola a bit steep, Parle saw an opportunity to fill the gap and came up with a cola-flavoured candy priced at ₹2 per pack. The candy was a fusion of Poppins (another Parle brand) and the coca flavor.
In the re-launched Rol-a-Cola, the flavour and formulation were expected to remain the same, with more vibrant packaging and bigger candy size, in tune with the preferences of the target group of 13 years and above, including millennials (See graphic on old and new packaging) .
Relaunch Powered by Digital Media
Parle worked along with ad agency ‘Please See’ to relaunch the Rol-a-Cola brand and had earmarked 100 per cent of the advertising funds for the digital launch. The theme for the re-launch campaign on social/digital media was that Rol-a-Cola had gone on a long vacation abroad, had felt really homesick and was returning to India, stronger, bigger and sharper (See Graphic on re-launch campaign of Rol-a-Cola).
The digital platforms included Twitter, Instagram, Facebook, and LinkedIn. Other digital initiatives included integration of the brand with the Web series and release of the digital films on OTT (over the top) platforms such as Voot, Hotstar, ZEE5, and SonyLIV.
Competitive pricing
Before 2006, the candy was sold at ₹2 per pack and, in its new avatar, it was sold in two pack sizes priced at ₹5 and ₹20. The low cost was expected to ensure affordability, even for kids.
Banking on distribution
Parle had started production and distribution of re-launched Rol-a-Cola by mid-September 2019 and, by the end of the month, had sold 20-25 tonnes in the Indian market. The distribution initially started in the southern market and moved to the North and East and finally to the western market. The production facility for Rol-a-Cola is located in Indore, close to the western market. With a good distribution network, Parle expects Rol-a-Cola to become a ₹500 million brand in the next six months and a ₹1-billion brand in the next 12 months.
Will Rol-a-Cola garner sales for Parle?
Even though Rol-a-Cola had garnered sales of 20-25 tonnes by the end of September 2019, analysts opined that it was too early to conclude that the trend will continue in the future. It remains to be seen if Rol-a-Cola will be able to make up for the decline in sales of Parle-G and become a ₹1-billion brand by October 2020.
Your Assignment
Consider yourself part of a team tasked with analysing the marketing strategy of Parle for relaunching Rol-a-Cola in India.
· What promotional strategy should Parle adopt for Rol-a-Cola to appeal to the rural market?
. Parle has traditionally used a low-pricing strategy. Should it employ a different marketing strategy for Rol-a-Cola in urban and rural markets?
· What strategy should Parle adopt to ensure long-term sales of Rol-a-Cola?
Send in your strategy, with graphics if needed, to blcasestudies@thehindu.co.in not later than midnight of January 12 . You can work in teams of two students, though solo entries are accepted too. Entries should be no more than 850-900 words long. Read the detailed contest rules on the Case Studies page.
(Sanjib Dutta is Research Lead and Anil Anirudhan is a Sr Research Associate at the Case Research Centre, ICFAI Business School, Hyderabad. This case was compiled from published sources, and is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation.) )
Sources for graphics: https://www.adgully.com/a-tweet-bhaag-milkha-bhaag-the-story-of-parle-rol-a-cola-s-comeback-88710.html