Haleon not suffering from trading down effect

Companies like Haleon have faced a customer loyalty test over the past year as the cost-of-living crisis has forced many people to reconsider their spending habits, often trading down from well-known brands to cheaper alternatives offered by supermarkets.

Haleon’s empire was built around its headache and toothpaste brands and in normal economic conditions one could expect it to clean up as consumers flock to ‘big brand’ names. Yet we’re not living in normal economic times and so consumer brand giants have not been able to sit back and wait for the cash to roll in.

AJ Bell’s Russ Mould said: “For some products like food and cleaning items, trading down from big brands to supermarket own-label items is an easy decision. However, working in Haleon’s favour is that fact a lot of consumers seeking relief from pain will stick with the brands they trust, believing they offer a superior product. That might explain why Haleon has done well over the past quarter.

“Across the business price hikes don’t appear to be having a negative impact on demand, given that sales volumes went up in the three-month period.”