In the past, it was probably a bit more, let’s say, what the country think and all these things, so that’s very different. Now, it’s really the full utilization of the flywheel between promo one thing A&P really coming start to – starting to kick in big time now, obviously, innovations coming back. We talk about innovation a bit later, hopefully. And then obviously the rest of the flywheel for us, so that’s the piece. And so what you need to see the projection, you’re talking about the first third of the year to your point, I think we like the trajectory. So in other words, April is we like what we see in terms of trajectory in P4. So that’s – I think the minus 13, minus 8, minus 2 is what you need to see. And nothing has changed, quite the contrary, compared to CAGNY and what we said in terms of not only the volume, by the way, volume is absolutely key and that’s why by the way, we give – we never provide these elements volume, but we know it’s absolutely fundamental, so we see this.
But let’s not forget the other piece, which is price and mix and we like what we see in terms of mix within our portfolio.
Steve Powers: Very good. Very good. And actually that leads to part of my next question. So as we go forward, I think your full year guidance, which calls for relative balance between volume mix and pricing on the year. It implies less price contribution as we go forward, and I’m curious from here, is that just more cycling prior year pricing or do you expect sort of net above the line investments and promotion from here, perhaps time with innovation to your point, earlier or otherwise, how do we think about? You’ve been very clear about the advertising investments you foresee, but I’m curious as to how we think about incremental investments above the line in promotion and price?
Sanjiv Das: So, Steve, just one point of clarification, just to be super clear there. We have, let’s say adjusted net sales, let’s say comments and perspective by highlighting volume and price mix together. For the main reason that effectively the focus on volume, it was important for us to clearly highlight that variable, hence the numbers that you are, let’s say that Stéfan has been sharing with you earlier, because you are mentioning volume mix. I think we’re looking at volume and we’re looking at price mix. So we have provided actually in the addendum, a reconciliation of the two but just so that you have the perspective there. And that enables us to really see the huge dynamic that we see now, volume and the strong momentum Stéfan was alluding to.
So what we are seeing right now, effectively as we lap now, last year into this year, and the fact that the environment is becoming moderately, if you want to slightly declining on some of the commodities, we will see less pricing impact year-over-year. I mean, from that standpoint on the other side, by the sheer fact of focusing our investments behind, must-win-battle, meaning, let’s say last category, big countries, highly profitable businesses and that are growing. We will have likely if you want stronger mix effect as we move forward. So what you will see, we see this gradual positive development on the volume side. But at the same time, if you want while pricing starts to moderate, it’s not going to be zero, it’s going to be just moderating because we will do some pricing on those areas where we will see some form of inflation, but we’ll have to do it in a very surgical way.
At the same time, we will be promoting through RGM, as Stéfan was alluding to, and making leveraging all of the legs of RGM. But the one thing that is going to come across in a stronger is mix. And so you have volume starting to clearly develop positively and price mix that will be skewed more towards mix than pricing overall.
Steve Powers: Okay, very good. Thank you so much. I will pass it on. I appreciate it.
Stéfan Descheemaeker: You are welcome.
Samy Zekhout: Thank you, Steve.
Operator: The next question comes from Jon Tanwanteng of CJS Securities. Please go ahead.
Jon Tanwanteng: Hi, thanks for taking the questions. Stéfan, I was wondering if you could talk about the must-win-battles. It was nice to hear that you grew in 15 out of, I think, 25 of them. I was wondering if you could talk about the other 10 out of the 25. We haven’t seen the volume growth yet. Is that just because they haven’t been activated or maybe a little bit later to start, or do you have to make any adjustments there as we go forward?
Stéfan Descheemaeker: Well, to your point, I think we are – we know we are classifying things between a, b and c. So the must-win-battles, you may remember, we started, obviously, we started with something like around 70% of our sales. And by the very definition of the focus on these must-win-battles, the 70% has become 80%, 85%, 90%, which means by definition, you have to do the exercise again. And now we’re doing it again and we more – much more focus again. And we have a, b and c. And let’s say a represents around two thirds of our sales. And obviously they have the highest margin. They have obviously the highest market share and also the highest progression. So within these 1.1% of sales and also minus 2% in terms of volume.
Obviously, you can imagine that’s where we’re doing the best by far. The others, the b private, let’s say must-win-battles are smaller, in terms something like probably 20% of these numbers. So they’re doing in line, I would say, with the rest of the business and well, which is fine, but that’s also just very reflective of where we’re putting our money and in promotion, but also A&P. So in terms of A&P, it’s interesting to see we’re not only increasing big time the A&P, but also with this increased amount. We’re focusing this increased amount to the a brand, to the – a must-win-battles, which is a double increase and that’s a big difference. So, in a nutshell, it doesn’t mean that we neglecting the b, the b must-win-battles.
They represent around 20% of the a must-win-battles. And they’re doing, let’s say, to make it simple, as in line with the rest of the business, I would put that way, the total business. So there is a difference. And that’s exactly what allocation of resources is. That’s very clear.
