In today’s uncertain economic times, price-marked packs are arguably more important than ever in communicating value to customers and driving sales and profits for retailers.
The role of price-marked packs in local retailing has long been debated with some retailers preferring the option of managing prices (and thus margins) themselves, and others seeing the value of those eye-catching price marks and the effect they have on consumer confidence and rate of sale.
The last couple of years, however, have been marked by economic chaos and a cost-of-living crisis that has severely impacted on consumers’ spending power. PMPs have been shown to be one of the most effective tools in the retailer’s armoury in terms of communicating value to the customer and generating trust.
“The specific and well-communicated price point helps to increase trust between the consumer and retailer, says Clare Newton, Trade Marketing Manager at Swizzels. “By specifying prices, consumers can make impulse purchases without feeling like they aren’t in control of their budget. Having clear visibility of the value for money that our products offer with a PMP means that consumers can still treat themselves to their favourites from our range.”
Newton cites how sales of PMPs in sugar confectionery in convenience are growing at a remarkable 13.7% [Circana, Jan 2024], demonstrating the power of the little price mark.
“PMPs have seen a surge in popularity within convenience stores with a significant portion of their stock now featuring PMPs,” says Newton. “This trend is primarily fuelled by consumer demand for clarity and affordability and is being accelerated by consumers spending more time at home due to the cost-of-living crisis, a trend that has also grown sales of sweet treats.
Newton advises that “PMPs are particularly important to maximise the sales opportunity presented by the increase of at-home gatherings.” This is especially important in hanging bags. “PMPs tend to be most powerful across hanging bag products such as our Drumstick Choos, Scrumptious Sweets and Luscious Lollies, as impulse purchases tend to be made often within the sugar confectionery category. PMPs can catch the attention of consumers looking for both a sharing bag or quick snack, especially when they see a marked price that suggests a good deal.”
Stocking a full range of PMP hanging bags is therefore a sensible idea.
Newton adds, however, that ensuring PMPs are a core feature of any product range helps influence consumers’ willingness to make an impulse purchase.
Snack attack
That’s certainly true in the snacks category where purchases often happen on the spur of the moment. “With 28% of people eating out less often [Norstat, Jun 2023], convenience retailers are well placed to be the go-to place to pick up the drinks and snacks that are central to impromptu events and gatherings,” says Matt Smith, Marketing Director for Tayto Group.
For Smith, the biggest challenge retailers face is demonstrating to shoppers that they are offering as good value as the supermarkets.
“In snacks, PMPs are the proven solution,” says Smith. “Value for money is one of the top three reasons for purchase in snacks with over 90% agreeing value for money is important! [Norstat, Jun 2023]. PMPs give shoppers confidence that they are not being ripped off which is why PMPs account for over 65% of snacks sales [Circana, Feb 2024].”
With sharing snacks still huge in local retailing, stocking sharing PMPs is the key to winning in Big Night In (BNI) snacks, believes Smith. “Sharing PMPs are now the dominant part of the market making up 61% of all snacks sales with Golden Wonder outperforming sharing PMPs, +21% vs +6% [Circana, Feb 2024], having remained at £1 as others have increased price points due to inflationary pressures.”
With many brands forced to move above the all-important £1 price-point, Smith says Golden Wonder has reaped the benefits of sticking with £1 PMPs. “Our commitment to putting consumers and retailers first means Golden Wonder £1 PMPs are growing at 21% [Circana, Feb 2024]. Independent retailers succeed by being local and offering great value for money. Having a solid range of £1 sharing snacks will boost BNI sales.”
That philosophy is reflected across Golden Wonder’s entire convenience range, with every product coming in PMPs. Smith also advises grouping snack PMPs together to let consumers see the full range and choose the snack for their mission. “Grouping by pricepoint rather than brand of product really makes it easy for consumers to make quick and easy decisions about what to buy,” concludes Smith.
To help boost PMP sales, Tayto Group has recently launched Marmite Crisps and Tortillas with a £1.25 price mark (see panel) and Chilli & Lime Transform-A-Snack at £1.
The Transform-A-Snack £1 PMP range is already in 40% growth [Circana, Feb 2024] and the new line should help build on that and deliver more sales for retailers.
Tayto Group has teamed up with one of Britain’s most iconic brands to launch Marmite Crisps (65g) and Tortillas (70g) in £1.25 price-marked pack (PMP) sharing bags.
Famed for its ability to divide opinion, Marmite is one of the UK’s best-known brands and the new crisps are likely to find a quick fanbase while the launch of the tortillas is a first for Marmite and will help to attract younger consumers.
The new range, which launched last month, delivers an authentic Marmite taste and the distinctive black packs feature the Marmite logo for high visibility in store.
Matt Smith, Marketing Director at Tayto Group says: “We are delighted to be working again with such an iconic British brand and we are especially excited to be bringing Marmite Tortillas to the convenience channel ahead of this product being available in other channels.
“With Sharing PMPs being so important, both the crisps and tortillas offer consumers the unique taste of Marmite with the assurance of great value.”
With over half of the UK population liking or loving Marmite [YouGov, Oct 2022] and with 96% buying savoury snacks [Norstat, Nov 2023], these new Marmite Tortillas and Marmite Crisps have real potential to boost convenience retailers’ sales of snacks.”
Jolanda Wells, Licensing Manager at Unilever adds: “Not only will Marmite crisps be a firm favourite with Marmite fans, with a new and improved flavour profile, but they are also great for the ‘first-timers’ who are a bit unsure whether they want to buy a jar of the black stuff or not. We expect both the crisps and tortillas to drive trial with new shoppers in the impulse channel and give retailers a distinctive new offering on their snacking shelves.”
Price point
Snacking giant PepsiCo is also focusing on PMPs, with Head of Wholesale Mike Chapman suggesting that “PMPs reassure consumers of value and help independent retailers to offer an accessible price point that builds trust with shoppers”.
Chapman adds that PMPs are also ideal for catering to multiple occasions and missions but urges retailers to stock “the right mix of flavours and brands”.
“Within the Independent and Symbols channel, the top-15 Sharing PMP Snack SKUs include Doritos, Quavers, Cheetos, Wotsits and Monster Munch [NIQ, Jan 2024], which demonstrates just how important these SKUs are,” he says. “To maximise this growth opportunity, we recommend that retailers stock a variety of Walkers brands in PMP format in-store to cater to multiple snacking occasions.”
Chapman says PepsiCo has continued to invest in the PMP format through NPD and line extensions across some of the nation’s favourite brands. He comments: “Launches like our Walkers Prawn Cocktail PMP – our third bestselling Walkers single flavour – or our Wotsits Giants PMPs continue to be popular with shoppers as they look for their favourite flavours.”
He also predicts that PMPs will continue to be at the forefront of crisp and snack sales in 2024 because shoppers are still looking for accessible price points.
“Within the Savoury Snacks Category, sharing PMPs remain the number one contributor to crisps and snacks growth in value, compared with other segments [NIQ, Jan 2024],” he says. “Retailers looking to grow their savoury snacking sales should look to prioritise the bestselling Sharing PMP Snack SKUs.”
Helping drive excitement, PepsiCo has recently launched a new Extra Flamin’ Hot platform featuring a range of three products that give an intense twist to favourites Doritos, Walkers Max and Wotsits Crunchy.
Extra Flamin’ Hot is available now in sharing bags with an RSP of £2.50 and PMPs featuring a £1.25 price mark. The existing Flamin’ Hot range across brands such as Monster Munch and Cheetos will continue to be available for shoppers, rebranded as Sweet & Spicy Flamin’ Hot.
The launch is being supported by a two-month multi-million-pound marketing campaign from early last month across TV, social, digital and consumer PR, with a second wave to follow later in the year.
Large format
KP Snacks is also seeing huge success with PMPs and, indeed, says it is delivering “the fastest growth in PMPs at +31.8% [NIQ, Feb 2024].” Worth £129m, the KP Snacks PMP portfolio features a variety of SKUs with price marks ranging from 40p to £1.25.
The company is particularly strong in large-format PMPs and says its portfolio features four of the top-five bestselling large PMP SKUs: Hula Hoops Big Hoops BBQ Beef, McCoy’s Flame Grilled Steak, Nik Naks Nice ‘N’ Spicy and Nik Naks Rib ‘N’ Saucy.
Matt Collins, Trading Director at KP Snacks, says: “KP Snacks’ extensive PMP range caters to all tastes, occasions and budgets and is perfectly positioned to engage shoppers and drive impulse purchases for retailers. Our mission is always to deliver the right products at the right price points to meet consumer needs and bolster sales for our retailer partners.
“Our smaller-format PMPs are also ideal for a quick and affordable snack, including Space Raiders, the UK’s number-one best value brand in 40p PMPs, classic heritage favourites such as Discos, Skips and Wheat Crunchies which are available in 50p PMPs and popular family choices including Hula Hoops core range and Pom-Bear in 65p PMPs.”
Most recently, KP Snacks expanded its PMP range with the launch of KP Mini Chips Salt & Vinegar £1.25 PMP and KP Mini Chips Beef £1.25 PMP as well as two McCoy’s Epic Eats variants, Nacho Cheese and Spicy Salsa, in £1.25 PMPs.
“Our market-leading KP Nuts brand is also well-positioned to drive sales,” says Collins. “With nuts exempt from HFSS restrictions due to their natural health benefits, KP Nuts £1.25 PMPs are an excellent product to capitalise on, available in classic and tasty flavours: Original Salted Peanuts, Dry Roasted Peanuts, Salt & Vinegar Peanuts, Honey Roast Peanuts and Aromatic Thai Chilli Coated Peanuts.”
Score this summer
With Scotland having qualified for the Euro Finals 24, there’s another huge opportunity for retailers to cash in and PMPs will sit at the heart of that opportunity too.
Irn-Bru is helping kick off summer sales growth and boost the category with special footy packs giving shoppers the chance to win branded supporters’ toolkits throughout the tournament.
Backed by a £2m brand investment, Irn-Bru will be activating the new packs with an impactful marketing campaign. TV, Outdoor and digital advertising will grab shoppers’ attention and POS toolkits are available for retailers to create stand out in store and at fixture.
Jonathan Kemp, Commercial Director at Barr Soft Drinks, said: “Irn-Bru is proven to drive the category around big sporting events. During the World Cup, the brand delivered 10% incremental category volume [Circana World Cup 2022] and it was the second-biggest national brand at the last Euros [Circana July 2021].”
To help get retailers and customers into the mood, specially badged ‘We Can’ bottles of Irn-Bru, Irn-Bru Sugar Free and Irn-Bru Xtra are available in £1 PMP bottles.
Drink to that
And it’s not just in soft drinks that PMPs will be making an impression this summer. Diageo will also be leveraging the power of PMPs across much of its extensive range.
“We know that consumers are continually seeking high-quality drinks options at affordable price points, and PMPs give retailers an opportunity to demonstrate good value for their shoppers,” says Lauren Priestley, Head of Category Development Off Trade. “Ready-to-drink (RTD) formats are popular options as they provide consumers with the great-tasting drinks that they know and love, in convenient formats. In fact, the RTD segment is the fastest growing within the total alcohol category [Nielsen, Jan 2024]. Stocking the RTD variants of recognised, much-loved brands can help excite shoppers, and draw them into the category – for example, popular brands such as Gordon’s Premium Pink Gin & Tonic 250ml PMP can (5% ABV) and Captain Morgan Spiced Rum & Cola 250ml PMP (5% ABV) and the more recently launched Smirnoff Raspberry Crush and Lemonade PMP (4.5% ABV). Merchandising these options alongside each other within the chiller allows for consumption shortly after purchase at the optimum temperature – something that the larger multiples typically can’t compete with. This will be particularly beneficial for customers looking for quick, convenient, and last-minute purchases.”
Priestley also advises retailers to stock PMP options across a range of spirits categories, including vodka, rum-based spirits and gin. Vodka, for example, accounts for 58% of PMP sales in the impulse channel [Nielsen, Sep 2023] and is therefore a must-stock.
“Having popular vodka brands – such as Smirnoff Red Label – available in a variety of formats (including 350ml, 700ml and 1L) provides shoppers with a range of high-quality yet affordable drinks options,” she concludes.
- Secondary sitings of PMPs are vital in snacks, particularly as shoppers are four times more likely to buy crisps, nuts and snacks if they see them in a secondary location.
- Put bestselling PMPs at eye line as this can drive up to 38% more sales vs being on the bottom shelf.
- Displays in store, especially nearer the till, play a key role with 35% of purchases in the Savoury Snacks made from these displays.
- Stock products that cover the different shopper missions and occasions we’re seeing demand for in the channel.
- Block by key mission: for later (multipacks), for tonight (sharing), singles and PMPs, so that shoppers can easily identify the format on shelf.
- In the weeks leading up to key events, such as finals of sporting events, remind your shoppers to pick up the essentials in a PMP format with dedicated displays and POS material to help grow sales.
