Parle Agro: Packing An Aggressive Punch

Updated: Jun 29 2002, 05:30am hrs
It seems that the taste of competition is stirring further the Indian beverages industry. While there is a lot of fizz on the cola front, action is also hotting up in the tetrapak fruit drinks segment too. And, here, clearly the accent is on innovation as major players in this segment are now stepping up their research and development (R&D) initiatives in a bid to cater to the specific needs of consumers across the country.

Prakash Chauhan, chairman and managing director, Parle Agro
Sitting at the helm of the Rs 420 crore Parle Agro Private Ltd, Mr Prakash Chauhan, chairman and managing director of Parle Agro (brother of Parle Bisleri’s Ramesh Chuahan) is now drawing up an ambitious gameplan which includes major expansion drives, strategies for growth, new product launches, research and development initiatives, extension of its distribution network, renewed thrust on exports, marketing and advertising plans.

As a major step in its ambitious first phase of the action plan, the company plans to set up a manufacturing base (for Frooti) in Sri Lanka to start with.” After Sri Lanka, we will move on to UAE. After seeing the great demand for tetrapak fruit drinks -specially for mango drinks—in many foreign countries, we opted to spread our wings to foreign locales this year,” says Mr Chauhan. India Inc. takes a close look at the Prakash Chauhan gameplan.

Thrust on R&D
At Parle Agro, Mr Chauhan strongly believes that ‘research and development’ plays a crucial role in gaining market share as well as mind shares of consumers in India. Hence, in sync with its new game plan, the company is laying a lot of emphasis on its R&D initiatives this year. With a sharp focus on this area, the company will soon be foraying into new categories too, informs Mr Chauhan. With a twinkle in his eyes, Mr Chauhan talks about his new product launches which are slated for Diwali season this year.” We are going to roll out a host of new products in the next few months. We are currently conducting consumer researches before launching these products. Enthused by the success of our—N-joi-a fruit and dairy product, we will be launching new products which has milk and fruit. In fact, I have two surprise packages for Diwali this year.” However, Mr Chauhan was reluctant to divulge further details about the Diwali surprises from Parle Agro.

Market pundits predict that Parle’s forthcoming new products could have fruit and milk ingredients.” Probably, the company may celebrate Diwali with the launch of chocolates, milk sweets, yogurt and jams. Foray into new categories will certainly propel the growth rate of Parle Agro,” comments an analyst in Mumbai.

But at another level, is Parle Agro’s mineral water brand losing its foothold as MNC brands surge ahead Replies Mr Chauhan, “ In fact, our mineral water brand has registered a growth rate of 20 per cent over last year. But, there’s an acute shortage for the brand as we are not able to meet the growing demand for Bailey in major metros.”

Incidentally, Parle Agro is also planning to foray into the healthcare segment by launching ‘Parle Bailey Digestive Water’ very soon, inform industry sources. “The company is currently conducting researches for its new healthcare brand which has digestive properties,” adds sources. On the new strategic move of the company, Mr Chauhan refuses to divulge details. As part of its marketing strategy to promote Parle Bailey, the company now offers customised water bottles for institutions and corporates to begin with. “Our first client is —Jet Airways. For this airlines, we have designed customised water bottles which will fit in trays of Jet Airway.

At Parle Agro, Mr Chauhan says that he believes that if one has the right game plan, you can achieve anything in life. Thus goes our corporate philosophy at Parle. He should know. Since 1983, Mr Chauhan, an engineer by profession entered this business, he has never looked back.” In this fiscal year, our sales turnovers will touch Rs 500 crore,” hopes Mr Chauhan.

On the company’s renewed thrust on ‘Research & Development’ Mr Chauhan says that in the Indian beverages industry, the name of the game is innovation today.” The proof of the product lies in its success. Our success lies in our research and development programmes. Our objective is to understand and cater products that suit Indian taste buds. So we lay a lot of emphasis on research and development initiatives,” he adds. And according to company sources, Mr Chauhan actively participates in all the research and development programmes that the company undertakes for over two decades.

Intensification of distribution network

To beef up its distribution network, the company plans to add 10 lakh retail outlet to its existing system by the end of this fiscal.” We will extend our network by 20 to 30 per cent this year. We plan to extend our reach to small ‘Talukas’ in the rural belts of India.

In a bid to reach out to a wider target audience, the company is currently beefing up its distribution network by adding 10 lakh retail outlets to its Parle Agro chain by the end of this year. “ We plan to expand our distribution network by 20 per cent this year. Also, we plan to reach out to small ‘Talukas’ in the rural belts across the country,” explains Mr Chauhan.

At present, the manufacture, distribution and promotion of Parle Agro brands are entrusted to a network of franchisees, strategically located to cover the length and breath of the country. Further, Mr Chauhan informs that the company’s franchisees never operate alone as Parle Agro provides them with all the support and information to sustain leadership in their area of operation.

In addition to Parle’s active research wing, Parle Agro Retail Barometer (PARB)intelligence, the company’s support to its franchisees also extends to the formation of a strategic stockists network, explains Mr Chauhan. Currently, these franchisees are empowered with an array of support systems which include, quality control, periodic technology upgradation, fresh distribution patterns and even the installation of new machinery as and when the need arises.

Integrated marketing
After establishing its position in the domestic markets, the company has now turned its attention to international marketing arena this year. Recently, the company has begun exporting its flagship brand—Frooti—to United Kingdom and United States.” After seeing the response to our mango drink in UK and USA, we planning to export our brand to other countries too. Our mineral water brand Parle Bailey is one of the few brands which is being exported to foreign countries now,” adds Mr Chauhan.

In a bid to promote its products, the company is planning to opt for a multi-pronged marketing strategy to woo consumers across the country. In fact, the company has earmarked an advertising budget of Rs 15 crore this year, informs Mr Chauhan.

Currently, leading advertising agencies Everest Integrated Communications and Quadrant Communications handle the adverting accounts of all the products from the Parle stable. In an effort to create a hype around its popular brand—Frooti-, the company had unleashed a multi-media ad blitz revolving around a mysterious character called ‘Digen Verama’. The objective ,according to the company was to showcase the rebellious spirit of the youth segment, the core target audience of Frooti through Digen Verma. As per media reports, people expected Mr Digen Verma to surface this year.But till today, there’s no news of Digen Verma. Why

On the past Digen Verma controversy, says a spokesperson from the company:” He was not meant to surface as he was just a fictitious characters created to catch the attention of the youth segment. Our brand will always be the hero in all our communications. In fact, our Digen Verma ad campaign won a host of awards last year.”

In the final analysis, Mr Chauhan says that strategic planning today has to take into cognisance the rapid changes in technology, increased competitiveness and the turbulent business environment. Sums up Mr Chauhan, “ Strategizing covers every aspect of business: from new business development, product development, brand positioning to advertisements and promotional campaign. In short, it’s a game of innovation -to be first off the mark.”