Who controls the price of your grocery product?  

Who controls the price of your grocery product?   

Once your product is on shelf, price is often the single largest factor that determines your success.  Sometimes you control the price and sometimes you don’t.

4 pricing issues

1.  You look at the category and pick a price position that is usually premium, middle of the pack or the economy brand.  If you choose premium, you also consider the real or perceived price ceiling that you believe exists for the category.  You decide whether to respect that ceiling or to beak through it at the expense of volume and the benefit of brand image.

2.  You decide whether to hold firm on your prices and resist the temptation to offer deals and pressure from the buyer. The buyer may decide to put it on deal himself.

3. You work with the buyer to offer deals on your products.  This can work, if you have thought through why you are doing it.  Too often it’s just the belief of the brand and the buyer that a lower price is always better.  If you are simply rewarding people who would buy anyway, a price deal is leaving money on the table.

Cutting prices can also become addictive at the expense of the brand image. If consumers see you frequently on sale, they may just delay a purchase until the next time you are on sale.

Sale prices also attract consumers who have little brand loyalty on switch brands depending on who has the lowest price.  Do you really want these customers?

4. Your competition is on sale.  You have no control over this and may very well over react to it.  It’s usually smarter to take a wait and see attitude.  Price wars are not pretty and the brand is usually loser.

You should ask yourself, who is in charge of my pricing?

Me?

The buyer?

My competition?

The consumer?

To often I find the brand allows their pricing to be controlled by someone else.

Interact on Shelf is a design firm that works exclusively with grocery brands.

What makes us different is that we study consumer culture, design trends, industry innovation and many other dynamics that shape opportunities for your brand in order to create iconic work that’s designed to sell in a retail environment.

If you think you could benefit from partnering with a young, energetic bunch like us, you know what to do.  Contact us!

By Blake Mitchell