Parle-G and the reason why this packet of biscuit still costs Rs 5

In 1994, the price of a small packet of Parle-G was Rs 4 and it remained that until 2021, when it was hiked by a rupee. As of today, a small packet costs Rs 5.

Parle-G is a brand of easily available and affordable packet of biscuits to some and an emotion to others. As the biscuit staple thrived for 25 years without changing its price, Saptarshi Prakash, Director of Design at Swiggy, recently shared some insights on how Parle-G is still available for Rs 5.

"In the year 1994, the price of a small packet of Parle-G was Rs 4 and it remained that until 2021, when it was hiked by a rupee. As of today, a small packet costs Rs 5. Ever wondered how is that even possible?" Prakash shared on LinkedIn. "Along with many operational optimisations, Parle also applied an incredible psychological hack to achieve this fete."

Elaborating on the hack, he added, "Now, when I say 'small packet', what comes to your mind? A packet which nicely fits in your hand holds a handful of biscuits? Majority of us would perceive it that way and Parle knew it very well."

Therefore, instead of hiking the prices they slowly and steadily kept reducing the size of portion over time, while maintaining the perception of small packet.

"It first started with a portion of 100 gm and a few years later they made it 92.5 gm and then to 88 gm and as of today, the small packet that costs Rs 5 weighs 55 grams, which is a good 45 per cent reduction from what they had started with in 1994," Prakash said.

Read more: On IndiGo flight, MD Rahul Bhatia's tea with Parle-G biscuits

Describing the technique as graceful degradation, he explained that companies manufacturing potato chips, chocolate bars, and toothpaste, among others also follow it. "This technique is called graceful degradation where something not-so-desirable happens so steadily that the consumers don’t feel the consequences of it," Director of Design at Swiggy.

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