India's big and growing biscuit market is dominated by three players: two old timers, Britannia and Parle, and one new kid on the block, ITC Foods. Britannia and Parle each command over 30% of the total market, while ITC Foods comes in at around 10%. The three players account for some 75% of the market. Britannia has grown at over 15% over the last three years, posting sales increases of 13%, 28% and 17%, in the fi scal years of 2006, 2007 and 2008. The 2009 year-to-date growth rate is 24%. Profi tability, under pressure from raw material cost infl ation, has been more volatile, but return on sales has nevertheless been a respectable 8.5%, 4.9% and 7.4%. So Britannia is a leader in terms of market share and has appreciable momentum in the form of strong revenue growth while maintaining a respectable return on sales.

To reach this position, Britannia's strategy has been one of incremental rather than radical innovation. From a branding standpoint, their recent strategy has been to leverage well-established brands, rather than establish new ones. Rather than venture into new product categories, Britannia has used line extension, staying within existing categories and introducing product variations (often around nutritiousness). One recent visible area of innovation has been packaging, with the introduction of lowprice, small-quantity packs, known as nano packs. By and large then, the strategy has been a conservative one, building on existing strengths, rather than creating new ones from scratch.