More

    A new era begins for PMPs

    Never before has there been such wide agreement between and across suppliers, no matter what the product, about the importance to sales of Price Marked Packs (PMPs). Regardless of the category, the PMP is being seen as at the forefront of the brand, not as a loss-leader but as a fundamental selling tool.

    Partly this is because of the changes in consumer habits recently seen as the lockdown has progressed; partly it is because of the recession that everybody suspects is about to arrive with the end of the furlough period and a wave of redundancies.

    If that scenario looks bleak, then bright, money-saving PMP offers draw in the consumer, consolidate the brand presence and cheer everybody up.

    A new world?

    Changes have been seen throughout the supply chain.Matt Goddard, Wholesale Trading Director at PepsiCo, is trenchant in his belief that things are different now:

    “Shoppers have been behaving differently in the impulse channel since the start of lockdown,” he says.“We’ve seen a trend towards people shopping more locally and more frequently. The traditional basket of a convenience retailer has changed, with single serve products declining, but larger pack formats increasing. People are actively seeking out multipack and sharing options, take-home juice options and Quaker Oats, which are normal larder-fill products that you buy as part of a grocery weekly shop. Shoppers are now looking to buy these products from their local store.”

    Wayne Thompson, Business Unit Controller for Out of Home at FrieslandCampina, purveyors of YAZOO, is clear in the importance of PMPs for his brand. “For us,” he confides, “building confidence in our brand from retailers and in turn, shoppers, is key. PMPs offer shoppers confidence in value for money when shopping in the impulse channels, which 41 per cent of all YAZOO purchases come from. We know that PMPs inspire trust from both shoppers and retailers and that’s why we’ve made them a permanent part of our offering.”

    A new era begins for PMPs

    PMPs do not necessarily mean lost margin, either. More sophisticated plans for making PMPs permanent and more widely applied bring with them economies of scale and organisation that can optimise profits.

    “It’s important for outlets to stock a range of flavours and brands within their PMP offering in order to drive these impulse purchases,” says Becky Unwin, Senior Brand Manager at Vimto Soft Drinks.

    Frequency and volume help make up any loss of margin with PMPs, with the additional benefit of luring in customers who will then add other items to their basket.

    “When it comes to what retailers should be stocking, price marked packs are important in creating a level playing field within the marketplace for wholesalers and retailers alike, giving both an opportunity to experience sales growth and therefore make a sizeable profit,” affirms Mark Tanner, Head of Wholesale and Independents at Carabao Energy Drink UK&I.

    “Whilst there is sometimes concern about the impact of PMPs on profit margins,” concurs Mark Roberts, Trade Marketing Manager at Perfetti Van Melle, “the allure of a PMP will help to increase impulse purchases, encourage repeat custom and ultimately drive stock through more quickly.”

    The growth in sales of PMPs is amazing, especially in soft drinks, where PMPs are now almost the norm – as Matt Gouldsmith, who is Channel Director, Wholesale at Lucozade Ribena Suntory, explains: “We know that price-marked soft drinks are growing more quickly than non-price-marked packs in the channel, with price-marked packs seeing 16 per cent growth versus an increase of 6 per cent from non-price-marked packs,” he reveals. “In fact, price-marked packs account for 74 per cent of total soft drinks sales in symbols and independents.”

    He adds that now lockdown is easing, PMPs more than ever “remain incredibly important for retailers when it comes to demonstrating value to their shoppers.”

    Alison Adderley, Field Sales Director at Coca-Cola European Partners, underlines the role PMPs can play in the “new normal” when she describes how lockdown habits – “an increase in demand for everyday treats like carbonated drinks” along with “a focus more on saving money” –are catered to: “PMPs tap into all of these consumer preferences and behaviours. PMPs offer visible value, reassuring shoppers that they can get the products they want, without being overcharged,” she says.

    In fact, according to Mark Tanner, PMPs are now chosen by seven out of 10 impulse shoppers over non price-marked. “More manufacturers are therefore price-marking their products and independent retailers are increasingly understanding the importance of PMPs,” he says, and Victoria Gell, Fruity Confections Portfolio Director at Mars Wrigley, underlines the essential PMP message: “As well as offering good value, PMPs help retailers build a sense of confidence and trust with shoppers, with many saying PMPs reassure them that they are not being overcharged.

    Giving groceries visible value

    The trend during lockdown has been for more home cooking, more eating in from outside– delivery and food to go (FTG), although not so much on-the-go – and more purchase in Convenience of “pantry” items that would have been carried home from a big box store.

    This means that manufacturers are paying more attention to the grocery side of PMPs because they can see the appeal of buying in local shops and therefore the prospect of elevated sales in the impulse channel.

    Using your local store as a premium burger joint is a wonderful idea that Rustlers, from Kepak Consumer Foods, have capitalised on in a big way – not least by going all-in on PMP to make buying one of their burgers an easily calculable choice.

    A new era begins for PMPs

    “Alongside ease of shop, many shoppers look to PMPs as reassurance of value, with big name brands like Rustlers meeting this demand by offering high quality at reasonable prices,” says Monisha Singh, Shopper Marketing Manager at Kepak Consumer Foods. “We recognise price-marked packs remain hugely important within the impulse sector and continue to support retailers by making all our top-selling SKUs available in price-marked packs,”

    This can offset even the drop in FTG sales that Rustlers had previously enjoyed: “Covid-19 and the subsequent lockdown has resulted in a lack of food-to-go missions, synonymous with the consumption of convenient, quick and easy lunch solutions. Despite this, over the last 12 weeks during the lockdown period, Rustlers Quarter Pounder has seen growth of 29.2% YoY highlighting the diversity of the product as a lunch and evening meal solution which is suited to both in-home and out-of-home dining,” Monisha says.

    The Rustlers PMP range is extensive and includes the Rustlers Quarter Pounder, £2, Rustlers All Day Breakfast Sausage Muffin, £1.75, Rustlers Southern Fried Chicken Sub, £2, and the Rustlers Moroccan Vegetarian Burger, £2.

    “Canned fruit has seen a significant surge in sales over the last few months, as consumers sought products with longer shelf-life in case of issues with the supply chain,” says Martin Tilney, Commercial Director UK and Ireland at Del Monte Europe Ltd. “As the current No.1 brand in the UK’s canned fruit market, Del Montehas seen sales of over £40.4m in Total Market throughout the last year, up 19.4% from the previous year.”

    Clear pricing is part of PMP success. Shah Khan, Senior Marketing Manager at Aviko UK & Ireland, points out that, “It’s important for retailers to offer PMPs as it gives shoppers clarity on pricing in addition to the perception of better value for money. I would say that price marked packs help shoppers across all demographics make the decision whether to purchase a product or not.”

    Shah says that store location is where it can get interesting: “Close proximity to a major multiple, shoppers will naturally make a comparison or through habit be used to buying a certain product at a certain price so retailers need to ensure the price mark is competitive.” And who isn’t close to a big multiple these days?

    Aviko’s range of PMPs includes their Supercrunch Chips (PMP £1.49), Bite sized Hash Browns (PMP £1) and Herb Diced Potatoes (PMP £1). Shah says these grocery products are in high demand and sell fast, and sacrifice nothing on margin either:

    “Our price marked pack products offer shoppers quality, special recipes at a competitive price – they can make up to 44 per cent POR on the range!”

    Reaching for a snack

    In food terms, before we move on to classic crispy snacks and biscuits, the products midway between burgers and bars are preserved meats such as Peperami and biltong (jerky) such as those supplied by Jack Link’s.

    These products are playing a big part in Convenience now, and also in PMPs, where the appeal of the product is enhanced by value and clear price-signalling.

    “Peperami is continuing to introduce new packaging which enables cases to be clearly merchandised, giving them greater visibility of products on shelf,” says Laura Trivulzio, Marketing Director for Peperami & Jack Link’s. “Jack Link’s, the consumer’s number one biltong brand, are also exploring the introduction of PMPs to their meat snacks range, as retailers look to swap confectionary with healthier snacking options for in-store impulse purchase opportunities.”

    Peperami already offers PMPs for their hugely popular single sticks in Original, Hot and Firestick priced at 79p. “Peperami products’ high protein content has proven to be a natural fit to both channel and shopper, filling a gap in the market for on the go beef snack products and answering demand from consumers for good value, innovative protein snacks in convenient formats,” says Laura.

    Jack Links is growing in double digits (in fact by +31 per cent), and is now the largest ambient meat snacks brand in UK Convenience. Worth stocking up on!

    A new era begins for PMPs

    Meanwhile, biscuits are a Convenience staple, and as you can read in our exclusive interview with Burton’s MD Simon Browne, sales are going up YOY for high-quality products such as Jammie Dodgers and Wagon Wheels – all seen, even in these ultra health-conscious times, as a “permissible” snack.

    Kate Needham, Marketing Director at Burton’s Biscuit Company, agrees that PMPs are a key driver of impulse sales in Convenience and says that Burton’s is tapping into this demand by offering a wide range of PMPs across its leading brands.

    Available now, the new Maryland Cookies £1 200g PMP range includes three flavour variants: Chocolate Chip, Double Choc and Hazelnut. The company also  offer a wide range of PMPs across its other leading brands, including Jammie Dodgers and Wagon Wheels.

    “Price-marked packs remains hugely important in driving sales in the impulse sector, playing a vital role in offering shoppers reassurance when it comes to value, a factor which will be more important than ever as the nation faces into the challenges of a recession,” says Kate. “We will continue to support the convenience channel by offering our bestselling products at attractive prices, enabling retailers to capitalise on the increased rate of sale we know PMPs can deliver.”

    Mondelēz also offers a varied biscuit range to meet shopper needs throughout the day, and it offers a wide range of PMPs to help retailers drive their sales.

    As the UK’s number one healthier biscuit brand, Susan Nash, Trade Communications Manager at Mondelēz International, says that belVita “is perfectly placed to support the growth of sales of PMP sales for shoppers on a breakfast mission.” For the morning and snacking occasion, belVita Duo Crunch is available in a PMP pack, while belVita Soft Bakes is also available in a PMP pack.

    A new era begins for PMPs

    For afternoon snacking, Cadbury Roundie 30g single pack and Cadbury Freddo Biscuits are both available in PMP format.

    “For shoppers, PMPs offer reassurance they are not being overcharged, while contributing to an overall positive price perception,”says Susan. “For retailers, the perception of improved value, convenience and trust from their customers make stocking PMPs a good option – with a fifth of shoppers even going as far as to say they would choose a particular convenience store if they knew it stocked PMP products.”

    For sharing, Cadbury Fingers and Oreo roll packs are also available in PMPs.

    Susan believes retailers should carry a range of price-marked formats within biscuits to help retailers show shoppers they are getting good value for money and therefore encourage trade-up and impulse purchases.

    Scott Snell (Vice President of Customer UK & Ireland), explains that pladis offers specific ranging and merchandising advice for the convenience channel through its Better Biscuits platform. By following its tailored advice when considering which PMPs to focus on, convenience store owners can strive to personalise their biscuit fixture – and ultimately drive sales.

    “PMPs remain a sure-fire way to demonstrate value to consumers and, in turn, drive sales for independent retailers. Thanks to the enhanced volume of sales which PMPs generate and the growing popularity of PMPs (up +11.5 per cent), independent retailers can be confident that products in this pack format will continue to help them generate profit.”

    He reveals that six of the 10 bestselling biscuit products in convenience stores are McVitie’s brands, and all are available in PMPs: McVitie’s Digestives and Chocolate Digestives, Milk Chocolate Hobnobs, Jaffa Cakes, McVitie’s Rich Tea, and McVitie’s Dark Chocolate Digestives – “So stocking these specific products in this pack format is a must for all independent retailers,” he says.

    Matt Collins, Trading Director at KP Snacks, reveals that their PMP portfolio is currently worth £52.7m RSV and growing, out-performing market PMP growth at a staggering +26.5 per cent.  “We offer retailers 21 PMPs across the KP family and continuously look to add value to retailers with both variety and promotion,” he says, adding that “PMPs cater specifically for shoppers who purchase on impulse as they provide much needed value from the bigger eat, whilst offsetting any potential price perceptions. A third of shoppers believe that PMPs are cheaper than non-PMP products, and 57 per cent want to see PMPs on crisps, nuts and snacks. Almost half of shoppers also like PMPs as it means they don’t have to ask the price in store.”

    A new era begins for PMPs

    KP Snacks’ must-have PMPs right now include McCoy’s Fiery Steak – £1 (the latest edition to the McCoy’s PMP portfolio) and McCoy’s Muchos Nacho Cheese & Smoky Chilli Chicken – also £1; Wheat Crunchies Crispy Bacon – £1 (worth £12.8m RSV) and POM-BEAR – 2 for £1 PMP: “Capitalising on the growing healthier snacking trend, KP Snacks has extended its ‘2 for £1’ offering which proved extremely popular with other family-favourite brand, Hula Hoops,” says Matt.

    “Young family shoppers account for 25 per cent of the on-the-go shopper base,” he notes, pointing out that KP’s PMP best-sellers include the Hula Hoops Big Hoops range (which grew by over a quarter in sales last year, with the £1 PMP BBQ becoming the no. 1 selling £1 PMP in the Convenience channel).

    A sweet spot for PMPs

    If PMPs encourage impulse buys, as they clearly do, and Confectionery is one of the most powerful impulse drivers we know, then it follows that some of the best NPD s will be in the candy aisle.

    Alongside its Cadbury PMP singles bars and tablets, £1 price-marked 95g chocolate bags are now available across Mondelēz’s bestsellers in the segment which include Cadbury Dairy Milk Giant Buttons, Cadbury Dairy Milk Caramel Nibbles, Cadbury Twirl Bites and Cadbury Bitsa Wispa. Retailers can also take advantage of PMPs on smaller packs through the PMP singles available for Cadbury Dairy Milk Freddo, Cadbury Dairy Milk Buttons, Cadbury Chomp and Cadbury Fudge.

    Cadbury Curly WurlySquirlies unveiled a new PMP format last year. The £1 PMP sharing bags have been developed to offer consumers this popular treat in a new size and help retailers capture shoppers’ attention in store.

    A new era begins for PMPs

    Meanwhile in sugar confectionery, Trebor Softmints and Trebor Extra Strong roll packs are available as a 50p PMP, and sugar-free Trebor Cool Drops are available in a 50p PMP box for independent retailers to help drive stand-out on shelf and encourage trial.

    Mints and gum are highly likely to be grabbed as a PMP. And Marta Gil, Brand Director Extra Gum at Mars Wrigley is happy to announce the launch of EXTRA Bottle PMP.

    “Mars Wrigley looks to continue to grow the gum category with the launch of its £2 RRP EXTRA sugar-free gum price mark pack 46 pellet bottle across its best-selling core flavours, Peppermint and Spearmint,” she says.“An exclusive format for the retail channel, the bottle format continues to tap into the growing demand for keeping teeth clean and breath fresh after snacking on the go.” Her colleague Victoria Gell, Fruity Confections Portfolio Director, points out that SKITTLES® Giants (launched in March this year),  are available in a 125g £1 PMP bag.

    Perfetti Van Melle’s extensive range of PVM mints and chews are a bunch of absolute must-stocks: Mentos Mint  and Mentos Fruit 135g bags, Fruittella Juicy Chews and Fruittella Duo Stix, and of course the Mentos Tropical bag.

    Our PMP sales are up 27.6 per cent,” says Mark Roberts, Trade Marketing Manager at Perfetti Van Melle. “We know that PMPs offer shoppers confidence in value for money and inspire trust when shopping in the impulse channels, which is the heartland of confectionery.”

    Over at Swizzels (the UK’s largest British-owned sugar confectionery manufacturer) Mark Walker, Sales Director, says that ‘‘Value-for-money confectionery continues to be a hugely popular choice for shoppers – particularly with the ongoing pandemic. Therefore, it is important for independent retailers to display a strong sugar confectionery PMP offering that provides breadth of choice and best-selling options to attract shoppers.”

    Swizzels have added a lot to their PMP hanging bag range offering recently, notably the famn0-inspired Great British Puds sub-range, which includes four individually wrapped chew bars in classic British dessert flavours; Sticky Toffee Pudding, Rhubarb Crumble, Apple Pie & Custard and Lemon Meringue.

    Energising and refreshing PMPs

    Mark Tanner, Head of Wholesale and Independents at Carabao Energy Drink UK&I, argues that value sales within the soft drinks impulse category are suffering, declining at -2 per cent, whereas energy drinks are bucking the trend to grow +1 per cent over the same period despite the COVID-19 crisis.

    This would be a reason to prioritise energy drink PMPs, firstly because they sell so well, and secondly because there seems to be extra value in them that can allow a PMP offer to still pay well for the retailer.

    Carabao’s new EDLP offer of 69p PMP cans heralds strong sales growth for stockists, he says.

    A new era begins for PMPs

    “The new ‘Every Day Low Price’ strategy put in place by Carabao means wholesalers can now purchase packs from the brand at a fixed price. In turn, this means retailers stocking Carabao will be able to measure and uphold their POR (profit on return) for each case, maintaining their profit margin all year long. This is incredibly important, especially in the uncertain times we are currently living in.”

    David Butcher, MD adds that “PMPs are only effective when the price that they are offering is competitive in the wider market, and many of our competitors are not offering the same value as we are in order to help entice new customers to the category.”

    Their attitude of aggressive, pinpoint pricing is designed to bring in incremental sales: “In fact, 33 per cent of Carabao sales growth comes from shoppers who are new to the category,” says Butcher. “Not only does Carabao’s range boast great tasting fruit flavoured energy drinks, all products contain 60 per cent less sugar than major competitors and only 63 calories per can.

    Price-marked cans are available for all Original, Green Apple and Mandarin Orange single-serve (330ml) products. “We’d recommend that convenience retailers add Carabao 69p PMP cans to their range to cash in on summer sales,” Butcher concludes.

    Carabao is also running an exciting summer promotion to speed PMP sales, giving retailers the chance to win one of thirteen £500 cash prizes throughout the month of August 2020, and one lucky winner scooping a very enticing £5,000.

    Every participating wholesaler will be guaranteed at least one £500 winner. One case purchased is one entry in the draw. The more cases each retailer buys, the more entries they get and there is no limit to the number of entries allowed.

    The energy gospel at Red Bull means that core range is available in both PMP and non-PMP formats, and includes Red Bull Original 250ml, 355ml, 473ml and Red Bull Sugarfree 250ml. Red Bull’s Editions range also consists of both PMP and non-PMP cans with flavours including Tropical, Coconut & Berry and latest edition, Summer Edition all available.

    A new era begins for PMPs

    Alcohol is represented by Jagermeister, which has a PMP that is performing very well in the impulse channel.“Price marked packs remain a focus for Jägermeister,” says Mast-Jaegermeister UK Category and Brand Manager Giles Mountford. Their newest product is a 20cl PMP, which is competitively priced at £6.79. It has outperformed the standard 70cl bottles of Jägermeister in the impulse channel, “Which tells us that consumers are looking for value when making their spirits purchases,” says Giles.

    The “big beasts” such as Coca-Cola are well-positioned to comment (and act) on the emerging PMP phenomenon. Alison Adderley, Field Sales Director at Coca-Cola European Partners (CCEP), notes that “consumer behaviour changed significantly during the coronavirus outbreak, and some new shopping habits and preferences are likely to stay for some time amongst convenience stores.” She says PMPs are important and “can be a way for independent retailers to create a point of difference, as more than one in four consumers say they are more likely to shop in a convenience store that stocks them.”

    She says they have made theiron-the-go 500ml bottle PMPs more appealing, too, with 500ml bottles of Coca-Cola Zero Sugar – again, including cherry and vanilla flavours – now coming in a £1 PMP, as do Diet Coke Sublime Lime and Diet Coke Twisted Strawberry.

    “We also offer Sprite, Fanta and Dr Pepper in PMPs for shoppers to enjoy, at home and on-the-go. Our 500ml bottles of Fanta and Dr Pepper come in a £1.15 or two for £2.20 PMP, with the Sprite 500ml PMP available at £1. Our 2l bottles of Fanta and Dr Pepper are available in a £1.89 PMP, with our 2l Sprite PMP available at £1.69.”

    A new era begins for PMPs

    CCEP means Monster Energy drinks of course – “The energy sector has grown by £139million over the last two years, half of which has been delivered by the Monster portfolio,” says Alison. Monster Energy original and Monster Juiced ranges have a PMP of £1.39 and the zero-sugar Monster Ultra range has a PMP of £1.29. Monster Green four can multipack also comes in a PMP at £4.59.

    At Lucozade Ribena Suntory (LRS), PMPs are taken very seriously. Matt Gouldsmith (Channel Director, Wholesale) says, “We know that price-marked soft drinks are growing more quickly than non-price-marked packs in the channel, with price-marked packs seeing 16 per cent growth versus an increase of 6 per cent from non-price-marked packs.” He can see this is particularly true when it comes to drink-later formats, which are growing by 8. Per cent: “Our portfolio replicates this trend,” he adds, so that Lucozade Energy 1L formats in Orange, Original, Apple & Cherry flavours have also been reduced to a £1.50 price-marked pack.

    “This 1L format is growing rapidly at 18 per cent in the independent channel in the past year, so now is the perfect time for retailers to capitalise on this popular format with a new reduced price-marked pack,” Matt says.

    Lucozade Energy has also introduced a new addition to its £68.9m flavours range for the summer season. Lucozade Energy Citrus Chill, a new lemon & lime flavour, is available in 380ml price-marked packs, as well as standard packs.

    Vimto Soft Drinks  Senior Brand Manager, Becky Unwin, Says that in addition to shoppers seeking value right now, “PMPs also make shopping easier for the consumer as they are clearly marked creating real on shelf presence, which in turn drives quicker purchase decisions.”

    To that end, and with their no added sugar variants contributing 50 per cent of sales, Vimto is including it in their PMP line-up, with the best-seller Vimto No Added Sugar 500ml comes in a £1 PMP, alongside the NEW Vimto Remix Orange, Strawberry and Lime, available in £1 PMP for 500ml and £1.29 PMP for 2 litres.

    In the dairy section, PMPs are just as important, representing 78 per cent of YAZOO’s sales in convenience, says FrieslandCampina’s Wayne Thompson: “They really are a massive part of our business.”

    Both the 400ml and the 1litre PMP formats are permanently available in the most popular core flavours (Chocolate, Strawberry and Banana) and our ever-popular Limited-Edition flavour, Choc-Hazelicious – and Vanilla (available in 400ml only).

    “Building on the success of our previous Limited-Edition flavours, we’ve just launched our third: Choco-Hazelicious,” announces Wayne, with the 400ml standard pack and one litre bottle available in a PMP.”

    Across the board, PMPs are revealing themselves as both important and appealing – something that is only going to become more so as time goes on. As Bestway’s Kenton Burchell sums up:

    “At Bestway, we believe PMPs are an important tool to help our retailers build trust with their consumers, it encourages additional purchases and drives cash profit.”

    Latest

    KP Snacks launches new Tyrrells recycled plastic pack

    KP Snacks today announces the introduction of 25 per...

    Brew Dog delivers low ABV with new Cold Beer

    This summer, BrewDog is cooling down the beer aisle...

    Mangrove portfolio dominates at World Whiskies Awards 2024

    The independent distributor Mangrove’s world whisky portfolio recently cleared...

    Co-op’s net zero targets validated global body

    Co-op has become the first UK convenience retailer to...

    Don't miss

    KP Snacks launches new Tyrrells recycled plastic pack

    KP Snacks today announces the introduction of 25 per...

    Brew Dog delivers low ABV with new Cold Beer

    This summer, BrewDog is cooling down the beer aisle...

    Mangrove portfolio dominates at World Whiskies Awards 2024

    The independent distributor Mangrove’s world whisky portfolio recently cleared...

    Co-op’s net zero targets validated global body

    Co-op has become the first UK convenience retailer to...

    Kitwave Group acquires 130-year-old delivered wholesaler

    Kitwave Group plc, the delivered wholesale business, has acquired...

    The wonderful world of price-marked packs

    Understanding when and how to make best use of PMPs can greatly improve your revenue and sales – and here ‘s how Price-marked packs (PMPs)...

    Exclusive: Grab appetizing margin with food-to-go

    Proprietary freshly made food can be a great way to propel customer visits, store margin and associated impulse sales thus boosting the overall revenue...

    Exclusive look into innovative Packmoor c-store

    In convenience retail, where every aisle holds a promise of its own, yet success does not come just by stocking shelves alone. A store’s...