Businesses assume consumers are fools
To the Editor,
If anyone saw a bold-typed exclamatory – Our new look! Lower price! – on the front of a packaged product they routinely purchase, they would likely think that this is a good thing.
That was my first reaction.
However, my momentary excitement gave way to deep-seated skepticism and general distrust of those things that look too good to be believed.
As it turns out, after doing some simple calculations, this is another example of corporate manipulation.
What could be the harm in a company changing the appearance of the package which contains the product one purchases?
Well, in this case, the appearance happened to be the actual size of the container of breakfast cereal.
This ‘new look’ was actually a 30 per cent reduction in the size of the box. This reduced the quantity of the contents from 650 grams to 450 grams. While this reduced packaging costs by 30 per cent, it means that purchasers will have to make 30 per cent more trips to the store to replenish their supply.
Perhaps the company has passed along some of its savings in packaging. Surely this must be the case since it so proudly announced its ‘lower price.’
Actually, that’s not what it is really talking about. The cost of the box of cereal did in fact go down. At my local grocery store, it went from $5.29 to $4.49. At first glance, that looks like a ‘savings’ of 80 cents or 15 per cent off the old price.
What the company doesn’t count on us doing is figuring out what happened to the ‘unit cost’. The old price per gram was 0.81 cents. The new price is 1.00 cent per gram. So, instead of the ‘lower price’ being 15 per cent lower, it is actually 23 per cent higher.
Even more disturbing to me than this exorbitant price increase is the fact the company is trying to take me for a fool.
Assuming that the top executives have no problem rationalizing such a huge price increase, they and their advertising people had to consider two alternatives on how to implement this change.
One way was to say nothing and risk being accused of being ‘sneaky.’ The other was to draw attention to it and assume their buyers are stupid.
Unfortunately, they know either way, buyers will soon forget and eventually be again ripe for the picking. We just rack it up to a cost of living increase.