I’ve recently been doing
a little more of all the grocery shopping on my own and given my attraction to numbers and getting a good deal no matter what the price point is, I took a closer look this last time. I was fairly surprised at the large variations in price for different versions of essentially the same item. Sure, some of it can be explained by packaging size, origin and preparation, but a lot of it you can’t explain. It’s just smart pricing and I get what’s going – I did take “Pricing Strategies” in B-School so I know the math that goes on in the background to get to a lot of these prices. I also like to call it “serious trickery for make benefit to glorious corporation.”
Here’s what I saw:
$5.99 for 25 square meters of Brilliant Earth recycled paper towels (6 rolls) vs. $4.99 for 10 square meters of Bounty (2 rolls)
This is basically half the price. Yes, size is a little larger and price will go down with size, but not by half. What’s the deal? Is Eco not selling? Are people really willing to pay that much more for Bounty? Admittedly, I do notice the Bounty towels to be softer, but this is crazy for what I thought would be a fairly commoditized product.
What I think is going on: Bounty is premium and users willing to pay. Brilliant Earth may be eco-friendly, but it’s really just the price-conscious brand which makes eco-friendlyness within reach of all consumers.
$7.50 for 1.25 lbs. lean beef, $6.99 for 1 lb. organic
This is kind of to be expected, but my situation was unique, because I only needed 3/4 lb. If I had bought the 1.25 lbs non-organic I would have thrown the rest away. There were no smaller sizes and we had no use for it that night, so I would have just thrown it out since it’s too small to keep for another time.
What I think is going on: Only one size at an odd package size forces users to always buy extra, but not so much that they would freeze and reuse later. Store wins because more is sold, but never used and the cycle continues the next time 1.5 lbs. is needed.
Grated parmesan cheese: 8 oz non-grated from wisconsin $3.99, 5 oz. grated Primo Taglio (I believe from Italy) $8.99, grated 5 oz. from US $4.99
I needed 4 lbs. of grated Parmesan cheese. There was quite a lot of choice here, spread out over two different locations. Grated by the hummus and salsa containers (why?) and blocks in a cooler. The interesting thing here is that Parmesan, especially non-grated keeps very well and for a very long time and that should make a difference in purchasing patterns, at least for me. Since I’m not totally lazy and we have an good grater, I went with the non-grated kind from the U.S. of A. although it was double what I needed. But since it was being used to cook (as it usually is like sprinkling on pasta), I didn’t care about any extra-special imported taste. The price difference is crazy: US grated is 2.5x non-grated and imported grated is 3.5x US non-grated.
What I think is going on: Even for small amounts of product, people are too lazy to grate themselves and so the store rightfully exploits this. I think the 50% markup on imported is defensible for import cost reasons.
Look carefully the next time you go to the store. Non-laziness saves. 🙂