There aren’t many brands with enough consumer loyalty to increase prices by 11% and still increase sales. Coca-Cola has demonstrated the impact that knowing your customers and adjusting prices accordingly can make on your bottom line. More on this story below in our latest Power to the Pricing People news roundup.
With food prices remaining high, the UK cost of living crisis shows no sign of easing
Recent data has revealed that inflation in the UK remains stubbornly high. Despite falling energy prices, the inflation rate for March remained above 10%. This was largely due to the rising price of going out and groceries, which rose 19.1% over the year. However, headline inflation is still on track to halve by the end of the year, thanks to a drop in energy costs and supply chain disruptions easing.
Read more about the soaring grocery prices driving up UK inflation.
Price rises don’t deter Coca-Cola customers
Coca-Cola has held onto steady demand growth in the first three months of 2023, despite increasing the prices of its beverages. The brand raised prices by an average of 11 per cent in Q1 to offset the effects of inflation and currency exchange rates. Though this didn’t scare off consumers, as global unit case volume increased by 3% in the quarter and net revenues rose by 5% year on year. CFO John Murphy said that by staying close to its customers, premiumisation allowed the brand to drive consumption for some products, while affordability drove it for others.
Read more about the impact these price increases and higher demand had on Coca-Cola’s earnings.
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