Following the pandemic, snack food prices rose by 23% between mid-2021 and mid-2023, as reported by the consumer price index.
This increase in pricing has led consumers to reduce their spending on snack foods. PepsiCo, the parent company of Frito-Lay, revealed in its quarterly earnings that the revenue of the snack brand decreased by 0.5% in the last quarter compared to the same period a year ago.
Additionally, Frito-Lay’s net profit dropped by 3.5% in the most recent quarter when compared to the second quarter of 2023.
PepsiCo CEO Ramon L. Laguarta suggested that certain products could potentially be priced lower. He stated, “There is a segment of consumers who are looking for increased value in particular parts of our portfolio. We are exploring various strategies to meet these consumer demands.”
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The company noted a decline in sales of unsalted snacks, while flavored potato chips remain popular among customers.
Laguarta further commented, “For certain consumers, we need to introduce new pricing levels and possibly different promotional strategies that do not require a large financial investment from the consumer when purchasing salty snacks.”
When asked about the impact of the increase in weight loss medication on the company, Laguarta responded, “I do not believe weight loss medication has had a significant impact on our category. We regularly engage with consumers and conduct market research to stay informed.”
