Premier Foods have admitted that they cannot rely on increased prices to drive growth forever. That’s why they’re digging into their toolbox to ensure volume growth as inflation begins to ease.
What exactly is within their toolbox?
First and foremost, the company is focusing on its “market-leading brands” to introduce “highly relevant product innovation”, in advertising and in-store activations in partnership with retailers.
This brand investment has seen Premier Foods upweight ad spend for many of its major brands including Bisto, Ambrosia and Mr Kipling in the run up to Christmas. In-store displays showcasing Premier Foods also helped drive growth for its brands.
Innovation has played a key role in the company’s model for growth, with new products having delivered incremental sales recently.
And now, with increased pricing likely to dim in terms of growth possibilities, Premier Foods has announced it will be using price promotion in the next quarter.
An initial run in quarter three saw a really strong response in terms of driving volume from the pricing mechanism and whilst price promotion can be a dangerous strategy to pursue, Premier Foods insisted it was taking a “scientific approach”. This has taken the form of continuous optimisation of promotions using economic modelling to get the best promotions.
Furthermore, price promotion has been used in areas where the company believes it will see the greatest risk of elasticities, meaning only in spaces where consumers may not buy its products due to price.
Premier Foods are looking to get ahead of competition, their toolbox has opened up possibilities.
Vivek Rajkhowa 
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