GfK Premium Brand
Successful brand management in Italy based on the premium strategy
March 2007
Scope of the study
Based on data related to a consumer campaign, Roland Berger and Gfk analyzed the three-year sales trend of 2,300 fast moving consumer product brands in Italy. The study identified the winning premium brands and their key success factors.
Context
Food sales in Italy demonstrate a slight upward trend in terms of volume only. Actual consumer prices have remained stagnant since 2002. However, there are different market forces, and polarization characterized by simultaneous ups and downs. Low price buyers are becoming more important (+2.4%), while other consumers are buying more premium and leading brands (+2.7%). The follower brands have paid the price and lost 5% of consumers.
Main study results
From amongst the 2,300 fast moving consumer product brands in 167 categories, we identified 245 (11%) premium brands with a minimum premium price of 150% higher than the basic price for the category.
Of these, only 31 brands or one third have proved real successes, boosting market share and price. A third of the brands lost market share and/or had to reduce prices.
A systematic analysis revealed 5 key success factors:
- Don't be afraid of discounts and use the full range of distribution channels
- Adjust prices to the distribution channel and do not draw back from promotions involving price cuts
- Despite skepticism, traditional advertising is continuing to grow. Take part to ensure your share of voice
- Opt for long-term innovation management
- A major change is not always necessary – working on the details can sometimes make all the difference
Market polarization offers potential for growth not just in the low cost segments, but also particularly attractive market opportunities in the premium segment, which follows very clear rules.
Contact:
Christian Gieselmann, Head of "Consumer Goods & Retail practice"
