KP Snacks: Social snacking drives the vision KP Foods Waterman's Business Park The Causeway Staines Middlesex TW18 3BA Tel: 01784 447744 Web site: www.unitedbiscuits.co.uk Key contactS Managing director Will Carter Sales director Peter Barkholm Marketing director Mandy Ferguson Key Brands · Hula Hoops · Skips · McCoy's · Mini Cheddars · Phileas Fogg Innovative new products have been a key ingredient in KP Snacks' recent snacks promotions. The company says it launched 37 new products, worth £47m, in the year to June 2000, compared with just 20 for the year to June 1999. The company is also keenly aware of extensive growth in the home snacking market. Research from BMRB/Mintel last year showed that more than 50% of adults regularly eat snacks in front of the television, making this activity the top snack consumption occasion for that audience. "Developments in home entertainment, such as the huge growth of video and cable and satellite TV, together with a decline in pub-going, have driven up consumption of snacks amongst adults in the home," says Duncan MacConnol, head of customer marketing for KP/McVitie. "Home entertaining is also rising, with one-third of adults consuming snacks when socialising with friends at home." This trend is backed by a growth in snacks designed to be shared ­ their value grew 3.2% year-on-year to £266.7m for the 12 months to the end of July 2000. They now account for 18.1% of the overall category, up from 15.5% in the past two years. For KP Snacks, this trend suggests secondary siting and promotional links opportunities. For example, cold drinks are present when 46% of all crisp and snacks are eaten (TNSofres Family Food Panel, 1999), yet only 9% of all cold drink occasions include crisps and snacks. Extensive research by KP Snacks on purchase decision-making has allowed it to respond to the changing tastes of consumers. In the first instance, this is driven by pack format ­ handy packs, sharing and multipacks ­ with each being split into everyday, children's, healthier and adult/premium segments. In the convenience and impulse (C&I) sector, all such consumer-driven pack format segments are showing growth. Handy packs represent the bulk of the savoury snacks market at £398m, showing 4.6% growth in the year to the end of July 2000. Total sharing formats have shown 2.2% growth over the same period and represent £50m across the C&I channels. Multipacks represent the smallest total in C&I at only £24m, but are demonstrating the fastest growth at 18% (MAT). Character licensing figures highly in the company's marketing because it believes this can be a powerful promotional tool. During its typical six to-eight week life span, says the company, a promotion connected to a high-profile licence tends to deliver an uplift in sales of between 30 and 40%. But a character licence is only truly effective, says KP Snacks, if the brand and the licence complement each other. It says this involves understanding your brands, the licence and your target market. KP Snacks points to its Skips Pokémon Battle Discs promotion as a recent example. Limited-edition collector discs featuring Pokémon characters were inserted into handy and multipacks. The demand for collectable Pokémon merchandise drove self-purchase amongst the brand's core consumers ­ 6-9 year-olds. As well as holding regular focus groups with children of all ages, KP Snacks works closely with its sales promotion agency to identify emerging trends. For the Pokémon promotion, it approached Nintendo about use of the licence in June 1999, well before the craze hit the UK. To clinch the deal, KP Snacks had to demonstrate not only that Skips offered a good fit for Pokémon, but that the licence would be used in a creative and impactful way. Special offers play a critical part in its promotions, says the company, but for true growth in the sector it prefers promotional mechanics that do more than simply reward the short-term deal buyer ­ so strong consumer-driven mechanics such as Pokémon will continue as part of its marketing programme. Everyday low pricing remains a central promotional strategy for several of its major customers, so KP Snacks will continue to support it where it can be done profitably. The company firmly believes that a combined effort by its commercial teams is key, so new product development and promotional activity will remain pivotal to its marketing, too. The company will also continue to work with its trading partners to ensure that its promotional activity remains aligned with its customers' requirements. In 2001, KP Snacks will run its most heavyweight campaign to date, including quarterly new product delivery. The company will look to build on the successful 2000 campaigns, Hoopy McHula and Sidney and Alfie, which supported Hula Hoops and Skips respectively. {{Z SUPPLEMENTS }}

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