Snack company Mondelēz International is introducing new “value” options to its product range as consumer perception of value shifts due to rising prices.
During an earnings call, Mondelēz CEO Dirk Van de Put explained that value now encompasses overall affordability rather than just the price per pack, especially for lower income consumers.
To address this shift, Mondelēz is launching targeted promotions with slightly lower prices on brands like Chips Ahoy! that have seen reduced demand from budget-conscious shoppers.
The company also plans to introduce smaller pack sizes of popular products like Oreo, Chips Ahoy!, and Ritz within the $3 to $4 price range later this year to attract value-seeking consumers.
Van de Put emphasized the importance of offering promotions, smaller pack sizes, and expanding distribution channels to meet changing consumer preferences, noting positive results for Chips Ahoy!, Oreo, and Ritz.
In terms of sales performance, Mondelēz reported a 1.9% decrease in net sales during the second quarter, with a decline in product volumes particularly in North America.
Similar to other food and beverage companies, Mondelēz is adjusting its pricing and marketing strategies to cater to value-conscious consumers. PepsiCo, for example, has seen success by offering more value-focused products like unsalted potato chips and increasing marketing efforts for certain brands.
Overall, the industry is adapting to consumer demand for value-driven offerings, with companies exploring various tactics to maintain brand loyalty and drive sales in a challenging market environment.