Why CPG leaders are paying closer attention to PPA this year

For years, growth management in CPG could rely on relatively broad pricing moves. A price increase here, an adjustment there, and most portfolios could absorb the impact.

Today, that environment feels far less forgiving…

Input costs remain under pressure, tariffs continue to create uncertainty in some categories, and consumers are paying closer attention to price. At the same time, retailers are scrutinizing assortment productivity, margin and the role each SKU plays on shelf more closely.

That helps explain why Price Pack Architecture (PPA) is becoming more central in commercial conversations. It is no longer merely a back-office exercise, but a practical lever to protect competitiveness, improve mix and respond more precisely to how on and offline shoppers are buying.

The limits of broad price increases

Across many categories, the old “peanut-butter spread” approach is becoming harder to sustain. A flat price increase across the portfolio may be simple to implement, but it often ignores important differences in price sensitivity, channel dynamics and pack roles.

Not every SKU should play the same role!

Some packs need to protect key price points and remain accessible, others can drive margin, and others may be better positioned for value channels, e-commerce or multipack missions. PPA helps make those roles more explicit.

When it works well, I’ve seen PPA allow companies to:

• protect important entry price points
• create clearer good-better-best ladders
• offer stronger value perception through pack design (not only through discounting)
• respond to cost pressure without relying on a single pricing mechanism

In other words, it gives commercial teams more options than simply raising list price and hoping the market accepts it.

Why retailer economics must also enter into the equation

One of the easiest mistakes I see executives make in PPA is treating this as a manufacturer-only margin exercise. In practice, however, the shelf works when both sides see the benefit.

If the proposed architecture improves your margin but makes the assortment less attractive for the retailer, it will be difficult to sustain. When the price-pack mix helps a retailer improve productivity, margin or category clarity, the conversation becomes much more constructive.

That’s why the best PPA work is usually cross-functional and customer-facing. It connects brand strategy with retailer economics, category roles and shopper missions.

Strong PPA architecture can help answer questions such as:

• Which packs truly earn their space on shelf?
• Where are we over-assorted?
• Where are we missing an important price point or mission?
• Which formats support retailer profitability as well as brand growth?

These reflections are often more useful than simply asking whether a product needs a price increase.

Shelves are now multi-dimensional

Another reason PPA matters more now than ever is that the concept of the “shelf” no longer means just one thing.

In store, the challenge may be assortment productivity and duplication. In e-commerce, pack design also affects shipping efficiency, damage rates and digital conversion. In club, value and convenience channels, the right configuration may look very different depending on the shopping mission.

That makes PPA less about resizing for the sake of resizing, and more about aligning format, price point and channel role.

The companies I’ve seen do this well usually do not try to force one architecture everywhere. They are clearer on where standardization helps and where channel-specific adaptation creates value. This kind of precision matters more when both consumer demand and input costs are less predictable.

Where should you start?

For teams trying to make PPA more actionable, a few starting points of reflection can help:

• Where do we have meaningful price-point gaps, pack overlap or SKUs that are no longer earning their place?
• Is the role of each pack clear across channels and shopper missions, or are we asking some formats to do too many jobs?
• Are Sales, Marketing, Finance and Supply Chain aligned early enough, or are key decisions still being made in silos?
• Have we prioritized a short list of actions tied to clear business outcomes, or are we trying to change too much at once?
• Are we measuring success only through internal margin, or also through mix, productivity and retailer acceptance?

The goal here is not necessarily to create the perfect PPA architecture on paper but to make better commercial decisions in the market based on the conditions you have today.

My overall take

While PPA is nothing new, the cost of getting it wrong has risen. In a context of volatility and more contested shelf decisions, broad moves often create broad consequences.

A more thoughtful price-pack architecture gives CPG leaders a more deliberate way to decide where to defend, where to premium-rize and where to simplify. In today’s environment, that precision can make the difference between protecting profitable growth and giving it away through blunt decisions.