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  • Christina Rüter

Price changes in times of inflation

2 brands show how it can or cannot be done.

PRICE REDUCTION and SUSTAINABILITY OPTIMIZATION versus SHRINKFLATION: 2 brands show how it should or shouldn't be done!

Times are expensive:

Consumers are complaining about price increases and switching to cheaper brands, companies are complaining about shrinking margins.

The climate is in crisis:

Consumers continue to look for sustainable and organic products. Companies are claiming to be "green", pursuing sustainability goals and reducing their carbon footprint.

The study by REWE Group and Consumer Panel Services GfK, Dr Robert Kecskes on sustainable consumption shows the facts*.

How can sustainability activities strengthen a brand, improve profitability and maximise customer benefits?

Achieving this win-win situation is the challenging task of forward-looking and successful brand management.

The organic tea brand #Yasashi from Ostfriesische Tee Gesellschaft GmbH (OTG) has shown how this can be done.

👉 The outer packaging was simplified and reduced. From the (beautiful) round cardboard box to the sustainable square pack (less material and logistics resources). Yes, high quality and uniqueness were sacrificed for this.

👉 The logo has been modernised in a barely perceptible way. The stencil-like stencil look of the letters has been discarded, making it finer and clearer.

👉 Otherwise, the design retains its emotional impact, the joie de vivre and the clarity of the varieties and differentiation.

👉 All in all, a truly SINful further development.

This contrasts with the shrinkflation policy implemented by Katjes International GmbH & Co. KG, which has been in place since 2022:

👉 Various fruit gum varieties such as Green Ear Bunny, Oceania and Party Wunderland have been reduced from 200 grams, the family packs 300 grams, to 175 grams and 250 grams respectively since mid-2022.

👉 The whole thing was done quietly, without drawing attention to the reduction in content or reducing the outer packaging accordingly.

👉 This means a HIDDEN PRICE INCREASE of 14 or 20% and a proportional INCREASE in the PLASTIC PART.

👉 In this way, the brand is maximising its profitability at the expense of sustainability and customer benefit.

foodwatch international has just issued Katjes with a warning for violating the prohibition on misleading advertising: Katjes is simultaneously advertising that it conserves resources and "produces as little waste as possible", it says.**

Is this a sensible brand strategy?

What do you think about these brands?

How important is sustainability and pricing policy today?


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