Penny's Marketing Chief Is 'Investing Heavily in the Brand' — but Sales Still Trail Rivals
Penny's marketing director Jan Flemming says the discounter is "investing heavily in the brand," and it is working on affection — brand sympathy is up 37% — but 2025 sales grew just 0.7%, the weakest among Germany's major discounters, as Penny absorbs the cost of leaving Payback for its own app.
A discounter betting on brand, not just price
In German food retail, the discounter playbook has always been ruthless simplicity: lowest price, loudest leaflet, repeat. Penny is trying to add a second engine. Marketing director Jan Flemming, in the role since summer 2023, told Campaign Germany that the retailer is "currently investing heavily in the brand" — and the affection numbers suggest it is landing, with brand sympathy up 37%.
That is a striking result in a category where shoppers are famously loyal to the nearest car park rather than the logo above it. Over two years, Penny has turned itself into one of Germany's most culturally fluent retail brands.
The awkward gap: love is up, the till is flat
There is a catch, and Flemming does not hide it. Penny's 2025 sales grew just 0.7% — the weakest showing among Germany's major discounters. Rising affection has not yet converted into faster growth at the checkout.
Part of the drag is self-inflicted but strategic. 2025 was Penny's first full year running its own Penny App loyalty scheme after leaving the Payback coalition. Swapping a mass points network for a proprietary app trades short-term reach for long-term first-party data and control — a bet many retailers are now making, and one that tends to dent numbers before it lifts them.
The creative engine behind the affection
The sympathy spike has been powered by an unusually prolific content operation. Penny has leaned into hype marketing (including a much-shared sheep stunt), meme recycling, a reality-style YouTube format, a World Cup push featuring former pros, and "comment coupons" that reward social engagement.
It has also built physical spaces around creators — the "Leylaland" store with influencer Leyla Heiter and an EDM-themed location with David Puentez — working with agencies including Saint Elmo's, Charles & Charlotte and Serviceplan Neo. The result is a discounter that behaves more like an entertainment brand.
What businesses should take from it
Penny's year is a live case study in the lag between brand and sales. Brand-building compounds; it rarely spikes revenue in the same quarter you spend the money. The discipline is holding your nerve — and your budget — through the gap, while watching the leading indicators (sympathy, consideration, app sign-ups) that predict the lagging one.
The loyalty lesson matters too. Owning your data via a first-party app is worth the near-term friction only if you actually use the data to personalise and win share back. Collecting it is the easy part; monetising it is the strategy.
Quick FAQ
What did Penny's marketing chief say about brand spending?
Jan Flemming, Penny's marketing director since summer 2023, said the retailer is "currently investing heavily in the brand," and reported brand sympathy up 37% off the back of a prolific content and campaign operation.
Why are Penny's sales growing slowly?
Penny's 2025 sales rose just 0.7%, the weakest among Germany's major discounters. A key factor was its first full year on the proprietary Penny App after leaving the Payback loyalty network — a move that trades short-term reach for first-party data.
Which agencies work with Penny?
Penny's recent work has involved agencies including Saint Elmo's, Charles & Charlotte and Serviceplan Neo, spanning hype stunts, influencer stores and social-first formats.
Penny is proving something every marketer knows but few boards accept: affection and sales move on different clocks. A 37% jump in brand sympathy is money in the bank — it just doesn't clear in the same quarter. The brands that win are the ones that keep investing through the gap. — Daniel Nikolla, Founder of Merx Marketing
Brand love is a leading indicator, not a lagging one — budget for the gap between the two, or you'll cut the investment right before it pays off.
When brand affection rises but sales stay flat, does your business hold its nerve — or pull the budget?
If you would like to know more about this topic, please contact us on danieln@merxmarketing.co.uk
Sources: Campaign Germany.
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Written by Daniel Nikolla, Founder of Merx Marketing Ltd and Marketing Minute
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