Value for money drives the category, especially for the convenience sector.
By Elena Dimama
The search for value shows no sign of waning for shoppers across the country, with price-marked packs (PMPs) ideally placed to drive sales for independent retailers.
According to research by Lumina, a fifth of shoppers have said they would choose a particular convenience store if they knew it stocked PMPs, while 56% of retailers said they have been selling more PMP products during recent times, according to a Mondelez International survey.
Savings opportunity
Two-thirds of the population believe it is important to make savings on their grocery bills, Nielsen’s recent State of the Nation Report found, with 69% of consumers planning to shop at many stores to take advantage of offers and 60% actively looking out for and trying to buy products when on promotions.
Meanwhile, 60% of consumers believe that the PMPs they see on-shelf are on a special promotion, according to Lumina, as price remains the second-most-important factor for shoppers.
“PMPs are a huge growth driver when it comes to the convenience channel, as shoppers perceive products in this format to represent great value for money – encouraging them to purchase on impulse. In fact, despite only making up 12% of SKUs in convenience stores, PMPs represent a huge three-quarters of sales in the channel,” says Aslı Özen Turhan, Chief Marketing Officer at pladis UK&I.
“With economic uncertainty manifesting itself once more, shoppers are opting for the bestselling, everyday snacks which they view as a permissible treat or ‘affordable indulgence’. Now more than ever, good value is a hugely important purchase motivator, so stocking the branded bestsellers – such as our range of Jacob’s Mini Cheddars PMPs – is independent retailers’ ticket to driving higher volume sales.”
PMPs can also pair up with another profitable category – that of meals, which is why Kepak’s Rustlers brand is also available in this format. “PMPs continue to provide a vital reassurance of value, with all of Rustlers’ bestsellers available in this format, however, value isn’t just confined to the price of a single product,” Ross Davison, Head of Convenience at Kepak (Foods Division), explains. “Product promotions also highlight good value and drive impulse purchase, such as an on-pack promotion giving shoppers something extra.”
Crisps and snacks
Stocking up on crisps and snacks PMPs has become a natural choice for independent stores, as PMPs are largely purchased on impulse. “What’s clear is that independent retailers can encourage shoppers to spend more in-store by stocking the bestselling snacking lines in this format. Consumers expect to see classic snacking lines in store anyway, so offering these at a price point which represents good value for money is essential to boosting overall basket sales,” Turhan adds.
Jacob’s Mini Cheddars PMPs are already worth £3m in the convenience channel alone, according to Nielsen, with pladis offering PMPs across a range of biscuits, including McVitie’s Chocolate Digestives and McVitie’s Chocolate Hobnobs.
“In terms of general advice, we’d encourage independent retailers to invest time in merchandising their snacking fixtures in the best way possible. An attractive display with a range of the bestselling PMPs and popular NPD – placed at shopper eye level and located in high footfall areas – will have a strong influence on shopper purchasing decisions. It’s about making the shopper experience as seamless as possible, so themed space and signage, and offering secondary sitings – such as at point of sale – are essential considerations in order to maximise sales.”
Wake up boost
The breakfast category is also benefitting from the multipack PMP format, especially as shoppers look for quick and convenient solutions to snack on in the morning. To capitalise on the trend and in keeping with the wider economic background, Mondelez is now offering its widest-ever range of PMPs across its brands and formats.
Belvita has introduced a new PMP format on its Honey & Nut flavour, as a result of the brand’s drive to enter the category. “As part of the brand’s aim to attract new shoppers and help add value to the category, the new belVita Honey & Nut PMP taps into the healthier multipack space within the convenience channel and communicates value to price-conscious shoppers,” Susan Nash, Trade Communications Manager at Mondelez International, notes.
In addition, Weetabix brought back its £1.29 PMP offer across the 250ml core range, as shoppers continue to focus on value for money. “Price-marked packs is king in wholesale and convenience, so the importance is crucial, even more so now as we hit the cost-of-living crisis,” Darryl Burgess, Head of Sales for Weetabix, tells SLR. “We’ve worked closely with our wholesale and convenience partners to ensure product availability over the past year, as well as offering advice to retailers so that they stock the topselling cereal brands to cater for the rise in at-home breakfasts.
“We continue to invest in the category as well, with popular NPD such as Weetabix Melts, available as a £2.99 PMP, and our award-winning Weetabix On The Go Caffé Latte, which was launched exclusively in the impulse channel to tap into the significant on-the-go opportunity retailers have.”
Sweet rise
Sharing treats is still a big sales driver even for squeezed households, providing room for bigger margins in the confectionery sector.
“As the cost of living rises, shoppers will be looking to reduce expenditure,” Gabriella Egleton – Senior Brand Manager – Kervan Gida UK, explains. “One of the ways they’ll do this, similar to during the height of the Covid-19 pandemic, will be by replacing nights out with nights in, and picking up their favourite feel-good foods and drinks to enjoy at home. Price-marked packs which highlight value to the consumer, and encourage impulse buys, will be key to driving sales at this time.”
The brand is offering its Bebeto 150g Big Mix, 150g Big Fizzy Mix, 150g Strawberry, and 150g Fizzy Watermelons gummy lines in £1 PMP, as 82% of retailers say £1 PMPs are “must-stock” items, described as “the main driver of growth in Convenience & Impulse”.
What’s more, Hancocks is also offering it Bonds of London range in a PMP line marked at £1.25, with flavours including Fruit Pastilles, Jelly Beans, Giant Strawbs, Chocolate Peanuts, Midget Gems, Fruit Jellies and Chocolate Honeycomb. “Our price-marked packs reflect confectionery trends for our convenience customers to get the most out of the products. Our Bonds price-marked sweets bag range appeals to customers of all ages, with a dedicated sweet bag range for kids at a lower price point,” Kathryn Hague, Head of Marketing at Hancocks, says. “Customers can still treat themselves even when they’re watching the pennies.”
- At a time of low confidence in spending, the price sensitivity shown by shoppers is set to continue through 2023 and the convenience channel will continue to benefit by offering price-marked packs. Products like Rustlers that are backed by sustained, heavyweight marketing support will have even stronger appeal.
- Savvy shopping is no longer just the domain of those on a tight budget. For many shoppers, the stigma once associated with finding a bargain is waning and they’re prepared to seek these savings, becoming common practice in FMCG today. PMPs at accessible price points help to attract new customers and encourage repeat purchase from both brand loyalists and impulse shoppers.
- Alongside offering PMPs, tiering is essential to highlight value propositions. Blocking products in good and better ordering from left to right makes the category easier and quicker to shop whilst offering obvious trade-up options from value to premium products.
- Value isn’t just confined to the price of a single product. Meal deals and bundle offers are popular with shoppers seeking for value for money. Product promotions also highlight good value and drive impulse purchase, such as an on-pack promotion giving shoppers something extra.
