In the summer of 1977, a convoy of trucks loaded with a new cola drink,
Thums Up, descended
on the IIT (Indian Institute of Technology) Delhi campus. Formally dressed in business
suits, representatives from Parle, the company that owned the brand, stepped
out of the trucks and started handing out free drinks to students like me.
It was one of those remarkable moments that helped build lasting memories for the brand. Thums Up
subsequently grew to dominate the Indian cola market.
A key reason for the brand’s success was the exit of Coca-Cola from the Indian market. The
government, in 1974, asked “low-tech” companies like The Coca-Cola Company to dilute
equity participation in their Indian operations to 40%, or leave. Rather than
comply with the edict, Coca-Cola exited the Indian market, and interestingly, so did IBM.
In Coca-Cola’s absence, the battle that ensued among the
several new cola brands was eventually won by Thums Up. Spurred by astute marketing, memorable advertising campaigns, a
well formulated product and Parle’s strong distribution network, Thums Up rapidly grew to
garner over 80% of the Indian Cola market.
In 1994, after re-entering India under the improved business environment,
Coca-Cola bought Thums Up to ease competitive pressures, as well as to
acquire the brand’s extensive distribution network.
At that time, The Coca-Cola Company was singularly
focussed on the Coca-Cola brand and the investment and support for Thums Up was drastically cut. It
became a fighter brand to contain Pepsi. (Though Coca-Cola denies it,
various sources allege that the
company tried to snuff out the brand).
Yet three decades later, Thums Up still rules the cola segment
in India, with a commanding share of over 40%, and sales of over USD 1B (2022).
Thums Up’s resilience is one of the finest examples of the
enduring value of a brand. Despite relatively low levels of investment for a
prolonged period of time, Thums Up remained ahead of mega brands like Coca-Cola
and Pepsi.
Sold for a meagre US$ 60 million, at a time when it cornered
85% of the cola segment, one wonders what share Thums Up might have garnered
today, had it been nurtured and sustained to the extent it was in the nineteen
seventies and nineteen eighties.
