The main advantage of price-marked packs (PMPs) over non-PMPs is the extent to which they give shoppers confidence in retailer price points.
In a recent survey, more than two-thirds of consumers said that PMPs provide a guarantee that they are not paying more than they should (Lumina Intelligence).
This view is also echoed by retailers, with just over two thirds (68%) of independents in favour of them, with ‘gives shoppers confidence’ cited as the leading factor (Lumina Intelligence).
Confidence in retailer price points is particularly important in the current high inflation environment when shopper budgets are squeezed.
Not only do PMPs boost confidence, they can also give the impression to the shopper that they are receiving a special offer on the product (Lumina Intelligence), ultimately driving sales.
Three in five consumers (60%) believe that the price-marked products they see are on shelf are on a special promotion (Lumina Intelligence).
“If inflation continues to rise to a forecasted 6%, PMPs will become even more important to suppliers and their retail customers,” comments Sunny Mirpuri, Director for Wholesale & Convenience, Budweiser Brewing Group. “We know consumer confidence in pricing is key so PMPs can provide much-needed reassurance.”
This Easter will see many planning larger gatherings among friends and family.
“Wholesalers should advise stores to stock up on multipack PMPs, which are more popular than unmarked multipacks among consumers, well in advance of these occasions,” says Mirpuri.
With 10-packs seeing the highest growth value of any pack size in 2020, increasing by £152.4m in the 52 week period (Nielsen), it’s clear these larger pack sizes of both PMP and non-PMP lines represent good sales growth potential for the Off-Trade.
“Stocking the best-selling premium beer brands within the PMPs range is also important,” adds Mirpuri. “Stella Artois, Budweiser, and Corona are all must-stocks. For instance, Budweiser, our brand with the most price-marked SKUs, was the second most valuable beer brand in convenience in 2021.”
Kenton Burchell, Group Trading Director at Bestway Wholesale, comments: “PMPs could be considered one of the grocery category’s greatest promotional tools, so it is no surprise that they have grown in popularity across other categories such as beers and impulse lines.”
Consumers are big fans of PMPs and in the top sellers lists across the Bestway range, each category includes PMP lines. In fact, the group price marks the vast majority of its own brand products and works to a minimum of 30% POR on certain categories. Bestway also runs regular promotions at 40% POR, which highlights that PMPs are absolutely worth investing in.
“We believe price marking our own brand at an appropriate margin for retailers provides consumers with confidence in value and enables retailers to position own brand ranges off shelf, whilst still communicating the price to shoppers,” adds Burchell. “In the convenience channel where customer loyalty is key, price marked variants play an important role in getting repeat business and building consumer confidence. While almost all categories operate PMP’s, retailers must strike a balance between high-value lines such as spirits and everyday essentials such as toilet paper, tea bags and multi-packs.”
Suppliers are not immune to the challenges facing the sector and inflationary pressures could potentially influence pricing in the future.
“However, it is important suppliers ensure there is adequate margin for retailers when setting new price points for PMPs and avoid passing on inflationary costs without changing existing PMPs,” says Burchell.
As consumer confidence has dipped following the soaring cost of energy prices, rising interest rates and more, PMPs have become especially important as they give shoppers confidence when it comes to price and value.
PMPs have been highlighted as a key driver of sales for certain categories and some suppliers assert that PMPs outsell standard packs by a ratio of 5 -1, outlining just how viable they can be.
“The product categories that benefit the most from PMPs are grocery, and impulse lines such as confectionery and soft drinks,” claims Burchell. “At Bestway, our convenience stores rely on grocery, impulse and BWS and so it’s important to ensure both the shopper and customer have the security of PMPs. Our advice to customers is to ensure they stock PMPs across the core range, this will ensure they have a stable sales and profit line – to protect the core business.”
A Red Bull spokesperson comments: “PMPs are vital to driving sales and are therefore a must-stock. If wholesalers promote the benefits of PMPs to their customers, they will help see an uplift in sales.
“Stocking PMPs helps to deliver choice to shoppers and Red Bull recommends stocking price-marked packs across best-sellers at all times, to demonstrate range and offer customers choice, whilst driving profit.”
The Sports & Energy category is worth £1.6bn, with growth totalling over £240.3m vs 2021 (Nielsen), and this growth has been fuelled by the increasing demand for Functional Energy. These drinks have added over £187.6m vs 2021 and have approached the billion-pound segment, today worth over £1.1bn annually (Nielsen). The consistent performance of Functional in the category has ensured that Sports & Energy has remained in growth, with Functional Energy the fastest growing segment in Sports & Energy at +19.6% YTD (Nielsen).
Due to the power of its rhombus packaging as a category signpost, Red Bull is the biggest Sports & Energy brand, growing by £81.0m with the second largest absolute gain on any other Sports & Energy brand (Nielsen).
“To capitalise on Red Bull’s success, the Red Bull Core range is the essential product range to stock in order to maximise sales and profits,” says the spokesperson. “The core range includes Red Bull Energy Drink 250ml, 355ml, 473ml and Red Bull Sugarfree 250ml.”
Red Bull Energy Drink 250ml alone is worth over £153m to the Total Sports & Energy category (Nielsen), delivering 10% of all Sports & Energy drink sales in the UK (Nielsen). It is the number one single serve soft drink in the UK (Nielsen), and by far the brand’s most familiar and best-selling SKU.
Red Bull’s Editions range also consists of both PMP and non-PMP cans with flavours including Tropical and latest edition, Coconut & Berry, both available.
Matt Collins, Trading Director at KP Snacks, comments: “PMPs have seen significant growth in the last number of years, with the format expected to continue increasing in both relevance and popularity. Not only do PMPs offer consumers great value for money, the clear pricing also gives them assurance that they are not being over charged. PMPs are a hugely versatile format that caters for multiple missions and occasions, whether that be hunger fill or sharing.”
54% of shoppers purchase items on impulse and PMPs drive these sales through clear messaging and displays (Lumina Intelligence).
Crisps, snacks & nuts (CSN) PMPs are worth £255.3m (Nielsen). This format is popular with retailers and consumers alike, with 82% of retailers saying £1 PMPs are must stocks (HIM) and 40% of snack shoppers saying they are more likely to buy a product in PMP format (HIM). Across the CSN market, £1 PMP ranges are growing in value at +9.6% ahead of overall market growth (Nielsen). £1 PMP ranges are the main driver of growth in Convenience & Impulse (Kantar) and represent 70% of the Sharing segment (Nielsen), the largest within Impulse. The PMP format is now the largest format within CSN across symbols and independents.
“At KP Snacks, we help retailers by ensuring we offer the right product range in the right formats, boosted with the right promotions and in-store merchandising,” says Collins.
Worth £66.9m and out-performing market PMP growth at +11.4% (Nielsen), the KP Snacks £1 PMP range offers an extensive portfolio of products with 25 £1 PMP SKUs designed to excite shoppers and drive impulsive purchases for retailers.
“The role of category leaders and large brands will become even more important as shoppers turn to brands that they trust, recognise and recall,” adds Collins. “Brands help retailers drive sales and retain shopper loyalty – 41% of CSN sales go through the top 5 brands.”
Two of the top 5 best-selling £1 PMP brands belong to KP Snacks (Nielsen). Stocking high-performing brands like McCoy’s and Hula Hoops Big Hoops drives purchases based on popularity and trust (Nielsen).
Big Hoops BBQ Beef is the no.1 fastest selling PMP in the impulse market. Topping £150m for the first time, the Hula Hoops brand is worth £158.4m and growing in value at +12.2% (Nielsen). Hula Hoops are eaten by 1.9million consumers every week (Kantar) and have an impressive 90% brand awareness (Kantar), making them a popular and tasty choice.
“Taste is the No.1 CSN category driver, meaning PMPs should deliver on delicious flavours as well as excellent value,” suggests Collins.
The McCoy’s Core range is one of the top 5 best-selling £1 PMP ranges (Nielsen), providing value and a variety of tasty flavours. The McCoy’s PMP range is is delivering +34.2% ahead of the total £1 PMPs sharing segment at +8.3% (Nielsen).
Earlier this year, KP launched McCoy’s Sizzling King Prawn in a £1 PMP format. The new McCoy’s PMP capitalises on prawn being the fastest growing flavour within the category, growing at +10% vs the category at +2.7%, making it perfectly positioned to engage consumers and drive sales (Nielsen).
Susan Nash, Trade Communications Manager at Mondelez International, comments: “Research shows that PMPs offer a number of advantages for wholesalers, and therefore are an important part of a store’s offering. For wholesalers, the perception of improved value, convenience and trust from their shoppers make stocking PMPs a good option – with a fifth of them even going as far as to say they would choose a particular store if they knew it stocked PMP products.”
Mondelez now offers its widest ever range of PMPs across its confectionery brands and formats. This helps these best-selling brands stand out on shelf with the convenience of clear on-pack pricing to help drive additional sales for wholesalers.
Cadbury Twirl Orange, which is now Cadbury’s most popular single bar (Nielsen), is available in a price-marked pack for the first time. The new price-marked packs are available now and feature striking 60p messaging.
“It’s important to remember consumers look for excitement from a category like confectionery,” Nash. “Last year, Cadbury helped wholesalers expand their confectionery range with the launch of Cadbury Caramilk, an exciting new and unique product to the category.”
The bars are made with a blend of white chocolate with a smooth texture, sourced from 100% sustainable cocoa.
Cadbury Caramilk is available in multiple formats – including a single bar to drive impulse sales – to help wholesalers recruit new shoppers with a trusted and recognisable brand, while tapping into a much-loved Australian chocolate classic.
To help drive sales further, this launch is also available in single and tablet PMP formats, improving stand-out on shelf while boosting shoppers’ trust with the convenience of clear pricing.
In sugar confectionery, Trebor Softmints and Trebor Extra Strong roll packs are available as a PMP, and sugar-free Trebor Cool Drops are available in a PMP box to help drive stand-out on shelf and encourage trial.
Snacking company pladis is helping independent retailers propel crisps and snacks sales by strengthening its £1 Price-Marked Pack (PMP) range, introducing this format to its popular Jacob’s Mini Cheddars Sticks range.
The new nibbly stick format will help retailers drive higher volume sales among shoppers seeking great value tasty snacks. It joins the existing line-up of £1 PMPs across the Jacob’s Mini Cheddars portfolio. Worth £4.8M (Kantar), the range currently includes Original, Smoky BBQ, Red Leicester, Nacho Cheese & Jalapeno and Ploughman’s Cheshire Cheese Mini Cheddars, alongside the recently launched Mini Cheddars Crunchlets.
“Not only is Jacob’s Mini Cheddars a shopping basket staple for over a third of Brits (38%), but it’s also one of our most exciting success stories – having grown +23% to reach its biggest RSV to date (£89.7M),” says Christopher Owen, Marketing Controller at pladis UK&I.
“We’ve achieved this by continuing to expand our range via exciting innovation and new flavours, tailoring pack formats to support retailers across all channels. Launching Jacob’s Mini Cheddars Sticks Grilled Cheddar & Sizzling Steak in PMP format will help to build on the brand’s already strong momentum.”
Now worth £5.1M (Nielsen), pladis is celebrating the success Jacob’s Mini Cheddars Sticks has achieved during just a short time on store shelves by launching Grilled Cheddar & Sizzling Steak flavour in a format which gives independent retailers even more of an opportunity to capitalise on its popularity.
“This reflects the important role we know PMPs play in driving impulse sales in the convenience channel. In fact, products in this format already represent a mammoth three quarters of sales in the channel, despite accounting for only 12% of SKUs,” adds Owen.
“With this new launch, supported by the brand’s strong performance and a pipeline of innovation in the mix for 2022, there’s never been a better time for independent retailers to stock up Jacob’s Mini Cheddars.” Jacob’s Mini Cheddars Sticks Grilled Cheddar & Sizzling Steak is available in a £1 PMP (75g), across wholesale and convenience. Packaging is recyclable through pladis’ partnership with Terracycle.
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