Thums Up

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 two decades later, Thums Up still rules the cola segment in India, with a commanding share of approximately 42% (2012).

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.

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