Flintfox - Intelligent Pricing & Rebates’ Post

Transcript

Welcome back pricing people. It's coming up to the midpoint of the year, so it's the perfect time to hit pause and take stock of how businesses are faring so far in 2024. We're taking a closer look at some big players to see how they're winning profits and making price rises work for them. We all know brand recognition offers businesses a power up, helping to maintain sales with consumers showing brand loyalty and favouring trusted products even when prices rise. However. Research indicates that pricing is the true MVP when it comes to influencing purchasing decisions. FMCG giant PepsiCo, for example, hit the sweet spot in Q1 with a 5% average price rise, contributing to revenue growth in the first few months of the year. Kraft Heinz also reported a pretty tasty first quarter with revenue up over 6% year on year despite declining sales volumes. With prices up nearly 3% in the first three months of the year, the business offers another example of price LED revenue. Right. However, despite this uplifting profits, the business fell short of initial estimates, largely due to pricing out cost sensitive shockers. To tackle this, the company is falling back on the promotional playbook, sweetening deals to aid recovery in volumes. Finally, let's peer through the golden arches. McDonald's global net income grew by over 7% in Q1 compared to the year prior, with higher menu prices helping to drive this boost. However, like Kraft Heinz, McDonald's missed sales expectations as customers tightened their wallets, and negativity surrounding pricing has even led the US CEO to write an open letter explaining price rises to win over budget conscious customers. Media reports suggest the business is leaning into promotions. And planning a $5 meal deal to tempt them back. That's all for this week. To find out how your business can increase profits with precision pricing and promotions, get in touch today. Until next time, power to you pricing, people.