All eight of Premier Foods’ ‘power brands’ have increased their market share for the first time in 18 months.
Premier spent 40% more in the first half of this year than it did in the first half of 2011 on marketing seven of its power brands, equating to an exta £8m. In real terms, this delivered a sales uplift of £8.4m to £418.9m for the power brands in the six months to 30 June.
“I’m very pleased we’ve been able to deliver momentum in the top line on the power brands during tough trading conditions, as well as 3% growth in our trading profit,” CEO Michael Clarke told The Grocer as Premier’s half-year results were announced (see page 7).
The power brands grew market share in their categories for 17 of the 18 weeks to 30 June. “We’re seeing market share growth across the power brands for the first time in 18 months,” Clarke said. “It’s a combination of investment, focus and building relationships with retail partners. Taking share from the competition is the best metric of all.”
The increased advertising spend would also strengthen Premier’s position in retailer negotiations, Clarke added. By improving brand equity with consumers, it would make it harder for retailers to remove product from shelves, thus avoiding any repeat of the problems it faced when Tesco removed 160 Premier lines in June last year during a trading dispute, he explained.
Premier also revealed it would complete a £40m cost-saving programme by the end of this year - a year ahead of target.