How mass market biscuit maker Parle became a leader in luxury chocolate segment with Friberg

In 2016, when Parle products announced its foray into the untapped luxury chocolate market with Friberg, which is mostly dominated by foreign brands, many thought the mass biscuit maker would hardly be able to stand a chance in the segment that mainly caters to affluent and well-travelled Indians.

But within two years, the premium chocolate brand, which sells a 100 gm bar of Belgian chocolate at Rs 500, almost double the price of its international competitors, emerged as the top player.

Mayank Shah, Category Head, Parle Products, said no other Indian brand is operating in the super-premium chocolate category. Asked what made Parle venture into this risky category, Shah said, “We don’t see any Indian brand out there and that’s the reason we thought we should have an offering. That, to our mind, was known to be an uncluttered and untapped market.”

Mayank Shah

“As it is not cluttered, we see consumer interest around there. There are these evolved Indian consumers who have globally travelled, looking at varied experiences, exotic flavours. We are seeing a good amount of buzz and traction there. Over a period of time, you will see more as the income level grows. As the aspirations of consumers grow; you will find more consumers moving into a category like this and that’s when you will see this kind of category finding traction in the market,” added Shah.

According to industry estimates, the chocolate market in India is pegged to cross $17 billion by 2020. And by being the first one in the market, Parle aims to shape the industry and set an example for other brands. The only competitors in the market for Parle are Lindt and some designer chocolates.

“In terms of premium category, for two-three quarters, we were number two in the markets that we were available in, only after Lindt. Lindt becomes really difficult to track because it comes through multiple channels — official and unofficial. However, we are one of the first movers (Indian corporate) to get into this category, so we would be developing the category. I don’t see much competition now. It is going to be a slow-burn process; you may see probably 50% to 80% growth rate on a very small base. It is not going to be very big volume or sales,” said Shah.

Friberg is only found in the top 10 metros and will restrict itself there for a while.

The company isn't doing any mass media campaigns for the luxury chocolate brand but is instead focusing on in-store and sales point promotion. It has planned very selected digital media presence.

In terms of sales, Parle hopes to increase traction during the Diwali season through in-store promotions.

“Volumes peak during the festive time; otherwise, you would not see much traction happening in this super premium category. A lot of that goes into gifting and is consumed during the festival. The category peaks during Diwali, Valentine’s, New Year’s end. It starts from Raksha Bandhan and goes all the way till Valentine’s Day, after which, due to summer, demand goes down.”

“In terms of our offerings during the festive season, you will see a good amount of gifting baskets in which you would find Friberg. We would also be offering some kind of promotions and offers, just to encourage customers to pick more,” said Mayank Shah, Category Head, Parle Products.

Since Friberg is talking to the super-premium category, it is only seen in selective chains like Nature’s Basket, Foodhall, Godrej. Imported from Belgium, Friberg started as chocolate wafers, first-of-its-kind in India. However, Parle failed in its experiment and decided to revamp the brand within a year. It will continue to promote its brand locally and will stay away from traditional advertising.

“With the wafer, we were not able to maintain its form because of the weather condition in India. It requires cold storage and entire infrastructure. And if it is exposed to even a little heat, the wafers stick together and deform. We faced these challenges and as a result of which we did away with it and moved to only bars. So, because of the kind of offering and target that we have selected, top-of-line kind of audience, even the advertising will be very selective. We are looking at advertising locally in-store branding. There will be a select digital, targeting the up-market crowd,” said Shah.

They have now six variants under Friberg and with the changing preferences; they will soon have more varieties to offer.

“We have revamped the offering. We had a milk and dark chocolate. Now we have added variants to bars, they were Swiss bars earlier and now we have moved to Belgium bars. This is like a top-of-pyramid kind of thing. If you look at other offerings than milk, they are all unique; Blackberry ginger, caramel sea salt, organic chocolate. No other player in the market has this kind of variety in the market. In the coming years, you will see more. We have started with these five, you will see more being added over a period of time.”

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