Glucose biscuits, once the biggest segment in the market, is now witnessing cream biscuits and cookies cornering more market share from glucose segment as consumers are going for premium range of products.
Parle G, the iconic glucose biscuit brand (in fact, the “G” stood for glucose), and Britannia are the top players in the Rs 6,500 crore glucose biscuit market. But over time,the market dynamics have changed and the glucose biscuits market has witnessed premiumisation of products and companies are launching more products in cream and cookies segment. ITC's Sunfeast has got a strong foothold in the cream biscuits segment.
The perfunctory presence was at the behest of retailers in the market, who used to press for a carrier brand and glucose was the category to be in. According to data from trade sources, during April-September last year, the glucose category accounted for a 19.3% share in the biscuit market, in terms of value, while cookies had a 26.2% share and cream 22.2%. The figures for the first half of 2010-11, however, show that glucose was at 26.5% with cookies and cream at 23.8% and 16.6%.
Recently, ITC Food's CEO, Chitranjan Dar had told this paper that the glucose segment is now loss making and it has shirnked. “The glucose segment is loss making. Its success or failure depends on the prices of sugar, wheat flour etc. There was a time when this segment was profitable and the old companies capitalized on this, and made it what it is. They had also spent a lot on the segment. By the time we came into the business, we realized there is nothing to it, but as starters one can’t be arrogant and say that I don’t want to do this. So we still did it,” Dar had told Business Standard.
Analysts too indicated the as Kaustubh Pawaskar, research analyst at Sharekhan, said,” The biscuit market is already witnessing a shift towards premium products and high margins in the cream and cookie segment is luring biggies to offer more variants in these segments. The non-glucose segment earns at least 10% higher margins,” said
Even Parle-G, has introduced several cream and cookie brands. Other players, such as Cadbury, has brought Kraft Food’s Oreo to the country, and GSK, which has extended its Horlicks brand into cookies, too have added
to the growth of the premium category. The UK’s United Biscuits is another player with a significant presence in the high-value segment.
