Same Price, Different Bite: Non‑Price Competition in India’s Biscuit Market

 Same Price, Different Bite: Non‑Price Competition in India’s Biscuit Market

Abstract

Indian FMCG markets are characterised by extreme price sensitivity, rigid psychological price points, and intense brand rivalry. In such environments, firms frequently converge on identical MRPs while competing aggressively on non‑price attributes. This case‑cum‑research paper analyses non‑price competition through the lens of the Bourbon biscuit segment, focusing on Britannia Bourbon and ITC’s Sunfeast Bourbon Bliss. Despite selling at the same ₹10, ₹20 and ₹40 price points, consumers consistently report differences in taste, creaminess, mouthfeel, and emotional experience. Using theory from behavioural pricing, industrial organisation, and marketing strategy, the paper demonstrates how “same price, different bite” becomes the dominant competitive logic in mass Indian FMCG categories. Comparative examples from Parle‑G, Good Day, Marie Gold, Patanjali, and HUL further illustrate how Indian firms defend price anchors while innovating on quantity, recipe, branding, and distribution. The paper concludes with a research design, managerial implications, and detailed teaching notes for classroom use.

Keywords

Non-price competition; Behavioural pricing; Price–pack architecture; FMCG marketing India; Biscuit industry; Brand positioning; Taste perception; Psychological price points; Britannia; ITC Sunfeast.

1. Introduction

Price competition in Indian FMCG markets rarely follows textbook models of continuous price undercutting. Instead, firms cluster around fixed psychological price points—₹5, ₹10, ₹20, ₹50—creating what appears to be price parity. Yet competition remains fierce. This paradox is particularly visible in biscuits, one of India’s largest packaged food categories, where consumers routinely choose between brands priced identically but perceived as qualitatively different.

The Bourbon biscuit category provides a clean illustration of this phenomenon. Britannia Bourbon, often perceived as the category’s originator and reference brand, and Sunfeast Bourbon Bliss from ITC, a later entrant, are almost always priced identically at the mass pack level. Still, consumers articulate clear preferences based on taste intensity, cream richness, cocoa flavour, crunchiness, and brand meaning. This raises a central strategic question: when price is held constant, how do firms compete, and what truly drives consumer choice?

This paper addresses that question by developing a structured case‑cum‑research study suitable for MBA, BBA, and executive classrooms, as well as for empirical research in Indian marketing contexts.

 

2. Market and Consumer Context: Biscuits in India

2.1 Category Overview

India is among the world’s largest biscuit markets, driven by low unit prices, wide distribution, and high consumption across age and income groups. Biscuits function as snacks, tea accompaniments, and even meal substitutes for lower‑income households. The market spans glucose, Marie, cream, cookie, and premium chocolate segments, with both organised players (Britannia, ITC, Parle, Mondelez) and unorganised local manufacturers.

2.2 Indian Consumer Realities

Three India‑specific realities shape biscuit competition:

• Extreme price sensitivity: Even small nominal changes (₹2–₹5) can trigger demand shifts.
• Income dispersion and regional taste diversity: Sweetness, cocoa intensity, and texture preferences vary by region and age.
• Channel dominance of kiranas: General trade prioritises fast‑moving packs at standard MRPs, reinforcing price rigidity.

Within this context, stable price anchors become almost non‑negotiable. Brands that disturb them risk volume loss and retailer resistance.

 

3. Pricing Architecture and Strategy

3.1 Price–Pack Architecture (PPA)

Indian biscuit brands operate a layered PPA:

• Entry packs: ₹5–₹10, aimed at impulse and low‑income consumers.
• Core packs: ₹20–₹30, the volume drivers.
• Family/value packs: ₹40 and above, targeted at urban households.

Britannia and Sunfeast mirror each other almost exactly on this architecture in Bourbon biscuits, signalling price parity to consumers.

3.2 Behavioural Pricing Logic

Behavioural economics explains why firms resist repricing a ₹20 pack to ₹18. Consumers encode price points as categories; deviation disrupts perceived fairness. As a result, brands prefer:

• Shrinkflation or expansion of grammage.
• “Extra grams free” promotions.
• Recipe or quality cues that justify the same price.

Thus, the competitive battlefield shifts from price to perception.

 

4. Positioning and Value Proposition

4.1 Britannia Bourbon: The Original Reference

Britannia Bourbon positions itself around heritage, consistency, and the “original” chocolate cream experience. Key elements include:

• Balanced cocoa sweetness.
• Stable biscuit‑to‑cream ratio.
• Packaging cues emphasising familiarity and trust.

For many consumers, Britannia Bourbon defines what a Bourbon should taste like.

4.2 Sunfeast Bourbon Bliss: Indulgent Modernity

Sunfeast Bourbon Bliss adopts a contrasting yet non‑conflicting position:

• Richer cocoa and darker biscuit tones.
• Thicker cream perception.
• Language of indulgence: “chocolate bliss,” “luxurious cocoa.”

ITC leverages its broader Sunfeast brand promise of “Spread the Smile” to inject emotional warmth and modern indulgence into the category.

4.3 Perceptual Mapping

On a perceptual map with Price (low–high) on one axis and Perceived Chocolate Intensity on the other, both brands occupy the same price zone but different experiential positions. This separation enables coexistence without direct price warfare.

 

5. Non‑Price Competition Framework

5.1 Quantity and Grammage

Empirical studies of Indian biscuits show that more productive firms often offer higher grammage at the same price. Consumers may not compute price per gram precisely, but they perceive “more biscuits” as better value.

5.2 Recipe and Sensory Differentiation

Taste becomes the primary differentiator:

• Cocoa strength.
• Sweetness and salt balance.
• Crunchiness and cream mouthfeel.

These attributes create switching without price changes.

5.3 Branding and Communication

When price signals are muted, branding becomes louder. Nostalgia versus novelty, tradition versus indulgence, and trust versus excitement shape preference.

5.4 Distribution and Visibility

Availability across rural kiranas and urban modern trade ensures that identical price packs are visible everywhere, reinforcing the perception of direct comparability.

 

6. FMCG Parallels: Same Price, Different Experience

6.1 Parle‑G

Parle‑G rarely deviates from its iconic ₹5–₹10 pricing, instead reinforcing value through nutrition cues and emotional messaging around affordability and care.

6.2 Good Day vs Sunfeast Cookies

Both brands often sell at identical prices but differentiate through butter richness, chunkiness, and indulgence cues.

6.3 Patanjali vs HUL Soaps

Patanjali frequently matches HUL’s MRPs while differentiating through Ayurvedic ingredients and nationalist symbolism rather than price cuts.

These examples confirm that non‑price rivalry is a systemic feature of Indian FMCG, not an exception.

 

7. Analytical Framework Integration

This case integrates six analytical blocks:

1. Context: Market size, consumers, channels.
2. Pricing Architecture: Fixed price anchors and PPAs.
3. Positioning: Perceptual separation at identical prices.
4. Non‑Price Competition: Quantity, taste, branding, availability.
5. Capabilities (VRIO): Brand equity, distribution, R&D.
6. Empirical Design: Measurement and hypothesis testing.

 

8. Research Design and Hypotheses

8.1 Research Objective

To examine whether perceived taste and experiential attributes, rather than price, drive brand choice and repurchase intention when prices are identical.

8.2 Sample and Method

• Sample: Consumers purchasing ₹10/₹20 Bourbon packs.
• Tool: Structured questionnaire with Likert scales.
• Variables: Taste intensity, cream richness, crunchiness, brand trust, perceived value.

8.3 Hypotheses

H1: There is no significant difference in perceived price fairness between Britannia Bourbon and Sunfeast Bourbon.

H2: Perceived taste superiority has a significant positive impact on brand choice at identical prices.

H3: Brand heritage moderates preference among older consumers, while indulgence cues dominate among younger consumers.

 

9. Managerial Implications

• Price parity does not imply strategic parity.
• Sensory differentiation can substitute for price competition.
• Fixed price anchors demand innovation in product and communication.
• Indian FMCG success depends on managing perception at stable MRPs.

 

10. Teaching Notes

Teaching Objectives

• To understand non‑price competition in price‑sensitive markets.
• To apply behavioural pricing concepts to Indian FMCG.
• To analyse positioning strategies under price rigidity.

Suggested Class Flow

1. Begin with a blind taste comparison discussion.
2. Ask students why prices are identical.
3. Introduce behavioural pricing and PPA.
4. Map brands on perceptual charts.
5. Extend discussion to other FMCG categories.

Discussion Questions

1. Why don’t Britannia or ITC cut prices to gain share?
2. How sustainable is taste‑based differentiation?
3. Can non‑price competition backfire in the long run?

Additional analysis

Price Parity, Perceptual Similarity, and Consumer Confusion in India’s Biscuit Market

In India’s biscuit market, leading brands such as Britannia and Sunfeast often adopt identical price points and similar category cues while differentiating only marginally on attributes like taste, grammage, and pack design. For a fast-moving, low-involvement product, this strategic convergence produces a paradox: objectively differentiated products are perceived as interchangeable. The result is consumer confusion driven not by lack of choice, but by excess similarity under severe attention constraints.

1. Price Parity and the Erosion of Price as an Informational Signal

In FMCG categories, especially biscuits, pricing is heavily clustered around long-established “magic price points” such as ₹5, ₹10, ₹20, and ₹30. These anchors have remained remarkably stable over the past decade due to consumer resistance to nominal price increases and the psychological salience of round numbers. When competing brands price at exactly the same MRP, price ceases to function as a meaningful signal of quality or value.

At identical price points, firms compete through non-transparent adjustments—altering grammage, number of biscuits, or ingredient intensity—rather than changing the headline price. Such adjustments typically yield differences of 8–15 percent in quantity or recipe richness, but these are difficult for consumers to detect without deliberate scrutiny. Consequently, shoppers form the perception that “everything costs the same and offers roughly the same value,” even when objective value differs. Price parity thus compresses perceived differentiation and shifts competition into dimensions that are cognitively costly for consumers to evaluate.

2. Non-Price Competition and Cognitive Overload

Uniform pricing intensifies non-price competition. Brands introduce multiple variants, highlight incremental claims (“extra cream,” “more chocolatey,” “richer taste”), and frequently tweak pack configurations within the same price band. While these strategies are rational from the firm’s perspective, they increase cognitive load for consumers, particularly in high-volume ₹5 and ₹10 segments that dominate biscuit sales.

For consumers operating under time pressure and low involvement, the proliferation of near-identical SKUs creates choice overload rather than empowerment. Evaluating subtle differences in grammage or formulation requires effort that is disproportionate to the perceived stakes of a biscuit purchase. As a result, consumers default to heuristics—brand familiarity, pack colour, or past vague impressions—rather than rational comparison. In rural and lower-income markets, where price sensitivity is high but price variation is absent, this mismatch further heightens the risk of perceived poor value or post-purchase regret.

3. Lookalike Packaging and Weak Category Boundaries

Packaging similarity compounds the problem created by price parity. In Indian FMCG markets, brands often rely on shared category codes—chocolate-brown colour palettes, cream splashes, biscuit imagery, and bold English typography—to signal product type quickly. When multiple brands adopt highly overlapping visual elements at the same price, the distinctiveness of individual brands erodes at the point of sale.

Under conditions of imperfect recall and cluttered retail environments, consumers may struggle to distinguish brands reliably, leading to accidental substitution or retailer-led switching. In small kirana stores, where purchases are often verbal and rapid, a generic request such as “₹10 chocolate cream biscuit” can easily result in either brand being handed over. Thus, similarity in “overall get-up” weakens mental brand boundaries and sustains a persistent zone of confusion between competing products.

4. Convergent Quality Signalling and Perceived Interchangeability

Indian biscuit brands increasingly project a “global” or internationalised image through English branding, modern layouts, and Western consumption cues. While this strategy enhances category appeal, it also homogenises perceptions across domestic competitors. When multiple brands signal comparable modernity and quality at the same price, consumers mentally classify them into a single functional bucket: acceptable, mass-market chocolate biscuits.

Because biscuits are low-involvement products, consumers rarely engage in systematic taste benchmarking across brands. Memory of past consumption is imprecise and quickly decays into general impressions rather than attribute-specific evaluations. Over repeated purchase cycles, this leads to a “same-same but different” perception—brands are recognised as distinct names, yet experienced as largely interchangeable. The coexistence of strong brand equity with weak experiential differentiation explains why leading players can sustain market share while still generating persistent consumer confusion.

11. Conclusion

The Bourbon biscuit rivalry demonstrates that in Indian FMCG markets, competition rarely revolves around price alone. Instead, firms defend psychological price points while engaging in intense non‑price rivalry through taste, quantity, branding, and emotional positioning. “Same price, different bite” is not merely a slogan but a structural reality of Indian consumer markets, offering rich insights for both managers and researcher

 

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