Case Challenge
‘CREAMING COOKIES’
July 19, 2014
Instructions:

Teams will submit a case analysis/solution document comprising no more than 6 pages
of single spaced, 12-point font (including illustrations and excluding TOC, Cover page). The first page
of the document must comprise of an executive summary of the solution suggested by the team. The
executive summary should be limited to one page only.

Along with the word document each team must submit a 10-slide presentation of the case
analysis/solution suggested.

There is no pre-determined structure to analyse the case. Participants are free to use any format which
best illustrates and provides convincing arguments supporting their solutions.

Wherever necessary, the participants must make references to the sources of information and data.

Case presentations will be judged based on the following criteria – the originality, creativity and
uniqueness of the idea will receive the highest weightage; the implementability, sustainability and
scalability of the idea; its fit with ITC’s vision and the manner in which it can leverage ITC’s strengths;
the thoroughness of research, analytics and economic logic used to defend viability and execution of
the idea.

Last date for submission of case solutions is 4th August 2014. Teams must send their entries to the
email ID provided for the campus.

For full details please refer to the Interrobang Season 4 Case Challenge Brochure available with your
Campus Point of Contact or contact interrobang@itc.in.
ITC Interrobang Season 4 Case Challenge: Creaming Cookies
CREAMING COOKIES
ITC Interrobang Season 4 Case Challenge1
Monday Early Morning @ Tushar’s Lawn:
Tushar was an early riser. His morning ritual of reading six newspapers from across the country in different
languages and genres along with a hot cup of the finest handpicked Assam tea was sacrosanct. This
morning, an article in India’s biggest business newspaper Business India brought a smile to his face. The
headlines read “ITC’s Sunfeast biscuits cream competition”. The contents of the article made Tushar proud;
the industry had acknowledged the remarkable success of Sunfeast’s creams portfolio.
Over the last couple of years, Tushar had overseen multiple launches in the cream biscuit space. These had
catapulted Sunfeast to a leadership position in the space. Sunfeast’s play in this category was through 3
sub brands; Sunfeast Special at the mass end offering a superior value experience at a price point of Rs.5
per pack, Sunfeast Dream Cream in the popular space targeted at kids and Sunfeast Dark Fantasy at the
premium end of the spectrum appealing to the “connoisseur” through indulgent and innovative products.
Each of these brands had achieved a leadership position in its respective segment not only in terms of
consumer wallet share but also mindshare. It was this performance that was making media headlines.
Keeping the newspaper aside, Tushar’s thoughts shifted to his weekly work plans. He had no idea what was
in store for him!
Monday mornings were always hectic with some fire or the other to douse. Running from agency meetings
to production meetings to meetings to decide when the next meeting could be scheduled; there was no time
for Tushar to revel in the public acknowledgement of the brand team’s success. It was almost noon when
he got the first opportunity to open his mail box. 60 odd unread mails, he slumped in his chair and sipped
his tea. Steadily ploughing through his mail box, a mail caught his attention. It was an invitation, titled “The
Next Big Thing”; the invitation was from his boss Samir. Samir was a man of few words and such a title was
almost against his personality.
The who’s who of the marketing team at ITC Foods were invited. The marketing director, Ratan, whose
razor sharp insights, observations, consumer understanding was unparalleled; the head of Research,
Jignesh, whose grasp on numbers could put Aryabhatta to shame; Joe Wilfred, head of the Advertising
Agency, a man who had worked on numerous successful brands across his 22 year advertising career. The
only minion amongst the stalwarts was Tushar.
Monday Afternoon, Samir’s Room
Samir was in his room with his back towards the cabin door and his eyes glued on the laptop screen. “Did
you read the Business India today; it says good things about your brands! So even the media thinks that our
strategy has worked? Not knowing whether it was a praise directed at him or a question, Tushar replied
“Hmmm, I think we should give it time, our competitors will surely react, and there have been a slew of new
launches. We have to watch out for this new brand, Oreo too. ”
Samir turned around and now looking directly at Tushar said, “Good, anyways I didn’t call you to discuss
creams today, though today’s discussion might have an impact on creams too.” Tushar was puzzled, settling
down in his chair in the most comfortable position possible with his afternoon black coffee, he asked, “Sir,
I read your mail about the next big thing. Sounds exciting, what is it all about?”
Samir smilingly responded, “Ah! it caught your attention, it was meant to.” Samir then continued in a serious
tone. “We have tasted success in cream biscuits and I agree with you that the task in creams has just begun.
However, we need to start thinking about where will we get our next big growth from. I believe our next
target should be the cookies segment and this is the next challenge that I am throwing at you. We will be
discussing our approach to cracking the cookie code – 3 C’s at the meeting this afternoon.”
Tushar was pleasantly surprised, however he realised he wasn’t ready for the meeting. He replied, “Sir I
am not ready for today’s meeting.” Before Tushar could complete, Samir interjected, “Don’t worry it is just
1This
Case is developed by and is the sole property of ITC Limited. This is for academic purposes only and is not
intended to be copied or displayed or reproduced at any place outside the Campus.
ITC Interrobang Season 4 Case Challenge: Creaming Cookies
a context setting meeting, I want you to come in with an open mind. Jiggi has helped me put together a small
presentation.” Samir thought if Jiggi has made the presentation, it could never be small.
4:00 PM- Main Conference Room
Smell of coffee permeated the room. Empty coffee cups were strewn on the table, this was the 4 th round of
coffee and all the participants knew that it was going to be a long day ahead! Jignesh had just finished
summarising his read of the biscuit industry.
Biscuits context
Last year had not been a great year for the biscuits category. With inflationary pressures and a slowing
down of the economy, the most penetrated food category in the country had suffered, managing an anaemic
8% growth. Biscuits being an industry of mammoth proportions necessitated it being sub-divided into
smaller categories for ease of management and understanding. The three dominant categories Cream,
Cookies and Glucose, contributed close to 70% of the industry.
However, the consumer did not divide the products in this manufacturer defined manner and there were a
lot of interactions between these categories. Over the years, glucose biscuits had been losing consumers to
lower priced creams and cookies. Over the last decade or so, cookies had become the largest segment
garnering almost a 1/3rd of the biscuit’s consumer spend.
While 2012-13 was the year of creams, cookies had made a great comeback this year. The category had
grown at a pace almost double that of the industry and had attracted consumers from almost all other
categories. Now it was Samir’s turn to lay down his thoughts on the table. He started with setting the
Competitive and Category context.
Cookies like cream biscuits are available across price points. There are cookie packs available at prices
ranging from Rs.5 to Rs.500 and remarkably all are referred to as cookies by the marketer and the
consumer. Cookies are consumed at various occasions, from packs bought as impulse purchase from the
nearest Kirana or Paan Shop ranging to gifting packs bought at gourmet shops located in hi-street malls.
Cookies, which are essentially a western concept, have been Indianised through flavours like Jeera, Kesar,
Elaichi, Butter, etc. and have also tickled Indian taste buds through Classical Western flavors like Oats and
Chocolate Chip cookies.
To sum up, it is an extremely complex category. However, there is one brand which defines this complex
category, just like Amul defines the Butter Industry, Xerox defines the Copier Industry and iPod defines the
Portable Music Player Industry; that brand is Britannia Good Day.
Britannia Good Day was launched in the 80s in two avatars - Good Day Cashew and Good Day Butter, since
then these two variants have led the growth of Britannia in the cookies category. Later on more variants
were added to the portfolio, Pista Badam, Chocochip and Choconut. Since its launch, Good Day was a hit
with the Indian consumers and for a decade or so there was little or no competition to the brand in cookies
space and it enjoyed an amazing, unhindered growth phase. Good Day operated at the premium end of the
industry and was available at a price point of Rs.10 and above only and commanded a market share of more
than 80%. This kind of market share might have made them complacent and they missed an opportunity
to expand the cookie segment.
This is where ITC with its Sunfeast Special brand made its play in 2006. It introduced to the Indian
consumer the concept of a cookie pack at Rs.5. This segment was taken one step further by the other homegrown player Parle. Parle’s masterstroke was the launch of its cookie brand, 20-20 at Rs.5 in the year 2007.
Backed with its extensive rural reach and a high advertising spend during the first few IPL seasons, 20-20
was a hit. Consumers saw value, they moved from glucose to cookies just like wildebeest move from dry
pastures to greener pastures in Masai Mara. Parle 20-20 became a Rs 1,000 crore brand in just 3 years.
Today, 20-20 dominates the popular segment with a 40% market share and Sunfeast Special has a 15%
market share and is predominantly strong in the South.
In the premium segment, the leadership position of Good Day continues. In the meantime, a new superpremium market emerged through Parle’s Hide & Seek. This segment also witnessed the launch of Sunfeast
Delishus in 2013, a super-premium cookie. The idea with Delishus was to exploit the gourmet cookie
ITC Interrobang Season 4 Case Challenge: Creaming Cookies
segment, a small albeit fast growing segment. Delishus seems to be working quite well in the initial stages
of its existence, carving out a distinct niche for itself among the sophisticated cookie consumer.
Samir ended his read of the industry with one last twist in the tale. It was only a matter of time before
Britannia started looking for a share of the value/mass cookie segment. It had tried this earlier through the
introduction of Britannia cookies but struggled to make any headway. Finally it did what marketing pundits
would dread to do. Britannia introduced Good Day at Rs 5 packs into the market at pack sizes equal to 2020 and Sunfeast Special in the strongest Rs 5 markets of North and West.
Who would have thought that one brand could straddle price points from Rs.100 to Rs.5, address indulgent
as well as mass needs, and satisfy the middle class Indian and also the nouveau rich mall going urban Indian.
The Indian consumer always appreciated value and on seeing her favourite brand now easily accessible,
flocked to it in hordes. Britannia tasted success and there was no stopping it. It soon extended the Good
Day Rs 5 pack to its stronghold, South India where Sunfeast Special enjoyed a monopoly in the space. So at
present the cookie story sounds something like this:
Good Day has successfully managed a strong play in both, the mass and premium price segments. Parle 2020 is fighting tooth and nail to protect its leadership position in the mass space and ITC Delishus is creating
a new space at the super-premium end of the spectrum while defending its share in the South in the face of
the new challenge posed by Good Day in the mass space.
Now with the context set, it was time to state the problem. At this moment, Ratan got up from his seat and
laid down the problem at hand in very precise and measured words.
“Gentlemen, it is time Sunfeast bakes the perfect cookie. It is time to go after the cookie market.”
After a brief moment of silence, he continued, “I have given it a lot of thought and the first question that we
need to work on is –
What should be the brand architecture to tackle the cookie market? Should we tackle it with one
cookie brand or go in with multiple brands, each for a specific consumer need or price band?”
Like his usual self, Tushar was ever ready with an answer. “Sir, that is easy, we tackled creams with multiple
brands. Each brand satisfying a need, Dark Fantasy for indulgence, Dream Cream for fun and Sunfeast
Special for value for masses”. “Too fast kid”, Ratan retorted. “What are your thoughts about this brand called
Oreo, it is one brand which straddles multiple product categories and price points available at mass and
premium end of the industry and across consumer segments, both adults and kids. Within the cookies space
there is Good Day whic has worked with one brand across multiple price points. Such a strategy enables
them enjoy economies of scale. While you will be spending on creating 3 brands, competition will be
spending on one brand. Tell me who will have a better mind share?”
Joe not used to being quiet for so long also pitched in, “Listen Tushar, consumers do not think of brands in
price buckets, we should create different brands if there are distinct, sizeable consumer need segments
which can’t be satisfied by one single brand.”
Valid points thought Tushar, perhaps the reason why Parle is trying multiple brands to crack the cookie
space. Perhaps this was the reason why Sunfeast’s strategy worked in creams. Tushar knew that men
around the table were just giving him food for thought and cues to dig deeper. This will be the first question
that he will have to answer.
Out came the next question from Sameer:
“Should we approach from the premium end with Delishus and other innovative offerings or go
directly head on with Good Day & 20-20 in the Mass and Premium Segment? What would be the
product portfolio?”
This time Tushar didn’t jump the gun and waited for the sharp observations of Ratan. “Our approach in the
super premium segment through Chocofills in Dark Fantasy has given us great results. An innovative
product route delays competitor response and hence gives us extra time to establish the brand”, said Ratan.
Tushar thought I won’t have to find an answer to this one at least.
However Joe had other ideas, “Innovative sounds good, but does the consumer want innovation in this
category. It looks like he is happy with cookies and is ready to switch provided we give him better value. I
ITC Interrobang Season 4 Case Challenge: Creaming Cookies
say go hit them where it hurts the most; Go after Good Day head one.” Sameer pointed out the fact that
“Going after Good Day is all good on paper but then we should be ready for a strong reaction, Britannia will
be merciless in its counter. After all it Good Day contributes to 60% of Britannia’s profit.”
The magnanimity of the task was gradually sinking in; Tushar had a complex problem on hand. Solving this
will mean a lot of black coffee, hours in front of computer screen. Apart from the two fundamental questions
that were put on the table there were other ancillary questions that he had to think about:
 Positioning Strategy: Once he decided on single brand or multi brand what should be the need
space that he should position the brand. The product strategy will have a bearing on positioning
also.
 Product Strategy: Me-too products as Joe had talked about or the innovative product strategy of
Ratan.
 Pricing Strategy: Should he discount? Or should he price similar to the competition. He knew very
well because of lack of scale he won’t have the profit margins the competition has and hence should
he compromise on profits in a business scenario where every penny counted.
So many complex questions, Tushar sank deeper in his seat. At this moment, all the three stalwarts looked
at Tushar and smiled. It was as if they were confident that he will come back with the right answers. Tushar
needs your help to find out the right answers.