Remember back when a Coke was a nickel and eggs were a dime? I don’t, but my grandparents do. Its always been written off as inflation blah blah blah. That’s true, prices generally increase over time. But no one (that I know of) has ever illustrated how inflation really occurs in the short term. Coke isn’t a penny more expensive each month in that linear fashion, its gone up in increments. We’re going to use Edy’s as the perfect example.
Edy’s is known as Dreyer’s (not Breyer’s) in certain markets, but its Edy’s for me. And boy do I love it. I first discovered their “Slow Churned” brand in college. Half the fat, 1/3 the calories, all the flavor. Perfect for someone trying to balance beer drinking, a sweet tooth, and keeping up with a super slim girlfriend. We were best friends, especially when it was “buy one get on free” or 2 for $5. The peanut butter cup was my favorite. The cartons were half gallon in size and then out of the blue dropped to 1.75 liters. This is a change of about 2/10 of a liter and went unnoticed. The price remained the same $5 and I didn’t complain.
But then, the unthinkable happened. The price increased. I wasn’t the only one to notice because my local grocer put up sign citing increased milk prices for the more expensive treats. After cursing those cows for controlling the dairy cartels I got over it because it was an unavoidable cost that was reflected in all ice creams. But Edy’s saw opportunity to increase profits without increasing the price further. One thing you should never do to Americans is make the cartons of ice cream smaller. Do you know nothing Edy’s? You don’t take ice cream from us! Going from 1.75 liters to 1.5 without lowering the price is as bad as OPEC controlling the price of oil. It pisses us off.
This is how inflation happens though. We slowly go to paying more per unit by subtle trickery. Sometimes they bump the price and blame it on inflation, but most of the time they bump the price for more profit. The sleaziest companies will do both. The down and dirty worst will reduce the size of the package without reducing the price. Regardless of method, prices go up and most people don’t notice.
Maybe I wouldn’t boycott your product if you’d dropped the price even a smidge, even just a little and you can keep some of the new profit. But you just tried to slip this by me; I may be fat, but I’m no fool. I quit you Edy’s Slow Churned. Blue Bell doesn’t taste as good but at least they embrace American overconsumption!
A video about food producers giving consumers the slip, with guest appearance from Consumerist editor Ben Popken can be seen here.
 By The Weakonomist |
The Weakonomist is the founder of Weakonomics. Clicking the picture of the puppy will tell you more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts below. Please consider a donation if you really enjoy Weakonomics. Also keep in mind that nothing I say can be construed as financial advice. |
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