Danone Puts €2 Price Cap on Alpro Milk in Belgium to Boost Category

French multinational Danone announces a campaign in Belgium where it will cap prices for Alpro plant milks (Oat and Almond, with and without sugar), at €2, representing a reduction of between 20% and 40%, depending on the retailer.

The manufacturer has signed a commercial deal with food distributors to agree on the price cap. “Of course, it is the retailers who set the selling prices, but they have all undertaken to take part in the action and not to charge consumers more than €2 for the next six weeks”, Olivier Rabartin, sales director at Danone Belux, explained to Belgium’s Retail Detail.

“We have reached a commercial agreement with our customers. The discussions were not easy, especially at the beginning, but they are playing the game.”

The price drop comes as a solution to the fact that these products are more expensive than soy and rice-based milks which are which are exempt from taxes on packaging and sugar, and aims to assist consumers in difficult economic times.

Taking the lead in the food transition

“The aim is to attract consumers to this category who currently buy little or no herbal drinks. We hope to convince them to try the products and add a little more plant to their drinking habits. This is part of our long-term mission to encourage healthy and sustainable eating habits as part of a responsible and sustainable business model. With Alpro, we want to take the lead in the food transition, even in difficult economic circumstances,” Rabartin adds.

The campaign is initially set for a six-week basis, after which, retailers can decide how to proceed. Rabartin states that “it’s up to retailers to decide. If they see rotations doubling, they’ll foot the bill. What do you do if you see sales rise sharply with slightly lower margins? We’ve seen huge fluctuations in rayon prices in our categories this year, irrespective of Danone’s recommended prices. These are strategic considerations for retailers. But I hope there will be a before and an after.”

Europe’s plant-based price drops

The initiative comes as retailers around Europe are making moves to bring down the prices of plant-based alternatives. Last month, Lidl announced it would create price parity with its own-brand vegan products to their animal-based counterparts, and was followed closely by German retailer Kaufland.

A study by ProVeg found that price convergence is now widespread across Germany, revealing that the average price difference between a basket of plant-based products and a basket of animal-based products dropped from 53 to 25 percent in one year. Following the lead of Lidl and Kaufland, Penny and Aldi Süd have permanently adjusted the prices of plant-based alternative products of their own brands to the prices of their animal counterparts. “The large retail chains have the opportunity to set standards. Consumers will measure all retailers against these standards from now on,” said the study’s co-author Virginia Cecchini Kuskow.

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