P&G is facing a snack decision with Pringles

Pringles is extending into popcorn, yet questions remain about P&G’s commitment to the brand despite significant investment, and many wonder if it will soon be for sale. By Branwell Johnson

Pringles will soon feel the force not only of a promotion tying in the Procter & Gamble- (P&G-) owned snack brand with the latest Star Wars film, but also a wave of new advertising and product launches.

The burst of activity includes extending the brand into unknown territory with the launch of Pringles Popcorn (MW last week). There are also rumours that the company is looking at launching “mini” Pringles. Yet the degree to which P&G is committed to the brand is being questioned and some commentators believe the household goods company is simply fattening Pringles up for a sale.

P&G remains tight-lipped about future plans, yet it has been prepared to invest in the brand. Last year it spent &£8.7m on advertising alone (Nielsen Media Research) and launched Pringles Dippers (MW January 22, 2004). It also extended Pringles’ Taste the World range with Mediterranean flavours last month, supporting the initiative with a &£1m ad campaign. And coming up there is the Win the Jedi Challenge tie-up with the last instalment of George Lucas’s Star Wars saga.

The brand continues to benefit from a strong distribution network, point-of-purchase innovation and stand out with its pioneering tube packaging and “double saddle” product design. But there is no denying that Pringles does not sit comfortably within P&G’s portfolio. Some industry insiders regard Pringles as a “tired brand” and one former Walkers sales executive says that it is no longer the thorn it once was in the snack giant’s side.

When P&G entered its ill-fated joint distribution venture with Coca-Cola’s juice drinks portfolio in February 2001, many thought it was the first step towards spinning off Pringles and Sunny D. But the venture folded eight months later.

However, there is nothing to stop P&G from offloading Pringles. Sunny Delight was sold off to JW Childs Associated last year and many observers wonder whether Pringles will be next.

But P&G maintains the brand is not for sale and a spokeswoman says: “Pringles is P&G’s most global brand, operating in a category one-and-a-half times the size of the laundry category. In fact, we sell more consumer units of Pringles than any other brand. As one of P&G’s billion-dollar brands, the company sees the business delivering value for shareholders for years to come.” She declines to provide value sales figures, but adds that the brand sits within the global household care business unit alongside coffee.

Paul Cousins, director of branding consultancy Catalyst, says: “If P&G were gearing up for a sale, I should imagine there would be many people willing to buy it.”

Datamonitor’s most recent figures show Pringles has a brand share of 12.5 per cent of the UK processed snacks market, which excludes potato chips such as Walkers Crisps. (Datamonitor does not class Pringles as a “potato chip” as they are made using a different process.) Datamonitor values the UK processed snacks market at &£1.319bn in 2004, and Mintel figures show the crisps and snacks market was worth about &£2.2bn in 2004.

Industry insiders question how many units of Pringles are sold at full price. The range of Pringles flavours is also beginning to raise eyebrows among UK buyers. One says: “I think it needs to do some range rationalisation – it’s too big a range at the moment.”

However, Cousins says the popcorn extension is a wise move and adds: “I don’t think extending the brand further is a problem.”

Pringles is not only under pressure from competitors keen to tap into “sharing occasions” with new brands and products, but also from health lobbyists concerned about the levels of fat and salt in snack foods.

P&G’s spokeswoman says: “We are looking at how best to provide additional help, such as the use of guideline daily amounts and healthy lifestyle tips. Pringles is already one of the crisps with the lowest salt levels – but crisps as a whole make up less than three per cent of the salt people eat.”

Pringles’ marketing has also had to change tack in line with consumer trends. Its advertising strapline has changed from “Once you pop you just can’t stop” to “Once you pop the fun don’t stop”.

Even Pringles’ unique packaging has come under attack. Walkers has used a similar approach for Stax, which was trialled with Tesco Express and Blockbuster last year.

Cousins says that Pringles’ great strength is in reaching both the adult and children’s markets. He points out that Pringles’ lunchbox plastic carrier was a good innovation that allowed parents to control consumption.

However, other companies are innovating in a way that may have an impact on the brand. Walkers introduced Potato Heads to win over parents in February this year. It’s a product with no artificial flavours or preservatives and reduced fat levels compared to standard Walkers crisps.

P&G shows no signs of letting Pringles sink into decline, but if the brand is to keep afloat it needs to address health concerns and maintain its reputation for innovative packaging.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here