Another challenge manufacturers face is that of managing price across a brand/pack portfolio. An anonymized analysis from a soft drinks study illustrates the example of a portfolio comprising a variety of brands and packs. In this example, the manufacturer has a portfolio of three brands. Brand A is sold in plastic, glass and can packaging. The plastic variant is also available in two options - as single and multiple packs.

Within the portfolio, each brand is likely to be under similar pressure:

• The internal pressures to grow volume/value sales, increase market share and be profitable
• Pressure from Retailers to promote or participate in EDLP (Every Day Low Pricing)
• Consumer pressure in terms of demand for VFM (Value For Money).

In such a scenario, price elasticities can help identify a price strategy for the portfolio that will optimise sales/profit, in a manner that recognizes these demands.

By observing the reaction to alterations in the promotional and regular price elasticities of brands, a strategic recommendation can be made.

Taking the example of Brand A, we can plot four different scenarios that juxtapose the outcome of changes in promotional activity and regular price on sales. (Figure 2)

• When sales change significantly as Brand A (single/multi-pack, plastic format) promotes, and change minimally when the pack changes regular price, a strategy of high price and frequent promotions ("Hi - Lo") is recommended.
• When sales change significantly as Brand A (multi-pack, can format) promotes and when the pack changes regular price, then one should review brand and promotion cost structure and harvest price for profit.
• When sales of Brand A (single pack, glass format) hardly change when the pack promotes and changes regular price, a strategy of high price and low, or no promotions ("Hi-No"), will suit the brand.
• When sales of Brand A (single pack, can format) hardly change when pack promotes, but change significantly with change of regular price, then a marketing strategy of EDLP should be adopted.

Drilling down into which promotions are most successful for each pack, further differentiations on the promotional strategies can be provided within the same framework. (Figure 3) For example, take the packs that respond to promotions:

• Brand A plastic form, multi-packshould use price promotions and singles should apply multi-buys (e.g. where you buy one and get the other at half price).
• Brand A cans, multi-packs should price promote or offer free volume (e.g. where two cans are included for free), but should not use multi-buy.