Last weekend, I went to a shopping store near my home and was casually buying some biscuits packs. I wanted to pick-up some Marie cookies. I saw two neatly stacked packs of biscuits, Marie Light and Marie Gold, next to each other. My initial thought was that they both belonged to the same brand, by when i picked up the packets, I realized one of them belonged to ITC and other was a Britannia cookie. I just picked them up and saw one of them had extra 21% off. And both of them were priced at Rs 10. Since, biscuits are usually a low intention purchase, I picked up 2 packs of Marie Light (the one with 21% FREE) and 1 pack of the other biscuit pack - Marie Gold. The packets also looked very similar in size and weight and nothing could really distinguish them barring the 21% off on of these packets.
Well, if you were to buy one of these, which one would you pick!? Look again at the how these packets compare with each other:
After I went back home, I flipped the biscuit pack and what i saw was truly outstanding, the Marie Light with the Extra 21% free was still smaller in size as compared to the original Marie Gold.
The Marie Light was 70g + 15g free (21% free) = 85 gm for Rs 10. And the Marie Gold was 89 gm for Rs 10. Look at the how the packets weigh:
This was pretty startling to me, as ITC is playing it really smart by offering extra 21% on an already lower base. Thus, making the overall packaging lucrative and still selling a packet which weighs less as compared to Britannia. I won’t be surprised if ITC is actually getting much more sales using this pricing tactic, while maintaining healthy margins. Hope Britannia would also counter this soon with a smarter move perhaps!
Suggest, what can be some of the strategies which Britannia can adopt to tackle this situation?
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