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> A study [1] by John T. Gourville and Jonathan J. Koehler analyzed data from the market for cereal and other sectors and found that consumers are much more gul

by xpe 5y ago

> A study [1] by John T. Gourville and Jonathan J. Koehler analyzed data from the market for cereal and other sectors and found that consumers are much more gullible than classic theory predicts. They are more sensitive to changes in price than to changes in quantity. Companies, of course, have known this for years. [1]: Gourville, John T., and Jonathan J. Koehler. "Downsizing Price Increases: A Greater Sensitivity to Price Than Quantity in Consumer Markets." Harvard Business School Working Paper, No. 04-042, March 2004. Get the full text at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=559482 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=559482 NPR only linked to a citation page :( https://www.hbs.edu/faculty/Pages/item.aspx?num=15756 https://www.hbs.edu/faculty/Pages/item.aspx?num=15756

esyir 5y ago
This is something that would be improved by something common in the eu. Price /weight or volume on labels.
- KozmoNau7 5y ago
  I appreciate that all prices in shops here also show the price per kg/liter or per individual unit in case of things like eggs. As a downside, it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products, and disregarding factors like quality and nutrition. This leads to way too many products in the ultra low price segment, and a hard time for makers of higher quality products. It's a race to the bottom, and shrinkflation still happens.
  - fogihujy 5y ago
    Going by price/kg is the best way to get around it. One still has to avoid low-quality products but that would apply if you looked at nothing but the packaging as well.
  - me_me_me 5y ago
    > it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products, and disregarding factors like quality and nutrition. That will happen no matter what. If you are poor you pay attention to price of the things you buy more then quality. I know it from practice, only when you have some financial stability you can educate yourself to pick the best product and not just kg/$. > This leads to way too many products in the ultra low price segment, and a hard time for makers of higher quality products. I don't think there is any kind of competition between quality product vs cheap products. Be it food or tools or etc. Both cater to different segment. Its like saying that if ford or fiat slash their prices by half, mercedes will loose some of the customers. Poorer people don't have much choice but to settle for cheaper options. When you have more money you will not buy processed food etc even though its cheap then quality unprocessed food because its hidden cost of health damage is too high.
  - throwaway0a5e 5y ago
    >As a downside, it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products Literally nobody shops by trying to buy the cheapest calories per unit. Calories are simply too easy to come by for that to matter. What people do is they make a menu (not necessarily before they go to the store) for the next 1-N meals then they choose brands or products that will accomplish that in the cheapest manner possible. This means they see the numbers and buy house brand butter. Where you get into issues is stuff like eggs where it's kind of hard to tell if the increase in size by buying large outweighs the savings per dozen by buying medium or where substitute products are not sold in easily convertible units and you have to do much more math in your head.
    - lbotos 5y ago
      Ah, you must not be friends with some of my friends then. I know at least 2 people who have min/max'd their calories/dollar to peanut butter and rice and beans.
  - jokethrowaway 5y ago
    The race to the bottom is happening because of inflation. Prices rise but not all salaries do, people have less money and they care more about the price.
- IfOnlyYouKnew 5y ago
  There used to be rules per product/category, specifying certain sizes and prohibiting all others. So sugar was always 500g, never 460g or whatever. I’m fine with the standardized prices now, and that seems to work for most customers.
- gruez 5y ago
  >Price /weight or volume on labels. That's already a thing in the supermarkets I go to
- amalcon 5y ago
  We have that in supermarkets in the northeastern US. It's great about half the time. The other half, they make you bust out the calculator unless you really trust your mental arithmetic. The small one is priced per liter, but the big one is priced per gallon. The big one is priced per pound, the small one is priced per ounce. I really wish more people cared about this, because the obvious solution (mandating SI units) would help finally move us toward metric...
  - earth_walker 5y ago
    You'd think so, but here in Canada the groceries play the same games by changing the definition of 'per unit' in different ways, for example price per 100g vs. price per kg vs. price per serving/capsule/sub-pack.
salamandersauce 5y ago
They sell Cheerios in 260g and 350g sizes where I live. The boxes are literally identical except in the corner where they print the weight. Same exact dimensions, look, writing etc. except that weight. The 260g box costs 12% less for 3/4s as much. The 350g box goes on sale more often too and is often cheaper. I have no idea what the point of the 260g SKU is except to trick people. It's not like Cheerios spoil easily. I have to pay extra attention when buying them. It's complete utter bullshit.
- Retric 5y ago
  I have learned to ignore the boxes and only look at the price per weight when buying cereal etc. Paying attention to the weight still works, but it’s hard to tell with cereal.
- daddylongstroke 5y ago
  Dude, why are you eating Cheerios? I thought you were worried about Covid?
- throwaway81523 5y ago
  Stuff like Cheerios is a huge rip-off anyway. Get bulk oatmeal: Quaker "traditional" is about $1 a pound at Costco. Cook for 4 minutes in an instant pot (no need for a half hour on a stovetop). Much more nourishing and filling than Cheerios, besides having no added sugar or other crap, and being cheaper.
  - jokethrowaway 5y ago
    Cheerios is different product. It's not oatmeal. I buy both oatmeal and cheerios. You can find generics that cost much less though and are pretty much the same thing. I tried in the UK a bunch of Tesco/Sainsbury cereal clones and they're as good as the branded ones, while costing 1/3 (which surprised me, my experience 10 years ago was that generics were significantly worse than the original).

by xpe 5y ago

esyir 5y ago

This is something that would be improved by something common in the eu. Price /weight or volume on labels.

KozmoNau7 5y ago
I appreciate that all prices in shops here also show the price per kg/liter or per individual unit in case of things like eggs. As a downside, it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products, and disregarding factors like quality and nutrition. This leads to way too many products in the ultra low price segment, and a hard time for makers of higher quality products. It's a race to the bottom, and shrinkflation still happens.
- fogihujy 5y ago
  Going by price/kg is the best way to get around it. One still has to avoid low-quality products but that would apply if you looked at nothing but the packaging as well.
- me_me_me 5y ago
  > it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products, and disregarding factors like quality and nutrition. That will happen no matter what. If you are poor you pay attention to price of the things you buy more then quality. I know it from practice, only when you have some financial stability you can educate yourself to pick the best product and not just kg/$. > This leads to way too many products in the ultra low price segment, and a hard time for makers of higher quality products. I don't think there is any kind of competition between quality product vs cheap products. Be it food or tools or etc. Both cater to different segment. Its like saying that if ford or fiat slash their prices by half, mercedes will loose some of the customers. Poorer people don't have much choice but to settle for cheaper options. When you have more money you will not buy processed food etc even though its cheap then quality unprocessed food because its hidden cost of health damage is too high.
- throwaway0a5e 5y ago
  >As a downside, it does lead to "crafty consumers" using the unit price as their highest priority criteria for selecting products Literally nobody shops by trying to buy the cheapest calories per unit. Calories are simply too easy to come by for that to matter. What people do is they make a menu (not necessarily before they go to the store) for the next 1-N meals then they choose brands or products that will accomplish that in the cheapest manner possible. This means they see the numbers and buy house brand butter. Where you get into issues is stuff like eggs where it's kind of hard to tell if the increase in size by buying large outweighs the savings per dozen by buying medium or where substitute products are not sold in easily convertible units and you have to do much more math in your head.
  - lbotos 5y ago
    Ah, you must not be friends with some of my friends then. I know at least 2 people who have min/max'd their calories/dollar to peanut butter and rice and beans.
- jokethrowaway 5y ago
  The race to the bottom is happening because of inflation. Prices rise but not all salaries do, people have less money and they care more about the price.
IfOnlyYouKnew 5y ago
There used to be rules per product/category, specifying certain sizes and prohibiting all others. So sugar was always 500g, never 460g or whatever. I’m fine with the standardized prices now, and that seems to work for most customers.
gruez 5y ago
>Price /weight or volume on labels. That's already a thing in the supermarkets I go to
amalcon 5y ago
We have that in supermarkets in the northeastern US. It's great about half the time. The other half, they make you bust out the calculator unless you really trust your mental arithmetic. The small one is priced per liter, but the big one is priced per gallon. The big one is priced per pound, the small one is priced per ounce. I really wish more people cared about this, because the obvious solution (mandating SI units) would help finally move us toward metric...
- earth_walker 5y ago
  You'd think so, but here in Canada the groceries play the same games by changing the definition of 'per unit' in different ways, for example price per 100g vs. price per kg vs. price per serving/capsule/sub-pack.

salamandersauce 5y ago

They sell Cheerios in 260g and 350g sizes where I live. The boxes are literally identical except in the corner where they print the weight. Same exact dimensions, look, writing etc. except that weight. The 260g box costs 12% less for 3/4s as much. The 350g box goes on sale more often too and is often cheaper. I have no idea what the point of the 260g SKU is except to trick people. It's not like Cheerios spoil easily. I have to pay extra attention when buying them. It's complete utter bullshit.

Retric 5y ago
I have learned to ignore the boxes and only look at the price per weight when buying cereal etc. Paying attention to the weight still works, but it’s hard to tell with cereal.
daddylongstroke 5y ago
Dude, why are you eating Cheerios? I thought you were worried about Covid?
throwaway81523 5y ago
Stuff like Cheerios is a huge rip-off anyway. Get bulk oatmeal: Quaker "traditional" is about $1 a pound at Costco. Cook for 4 minutes in an instant pot (no need for a half hour on a stovetop). Much more nourishing and filling than Cheerios, besides having no added sugar or other crap, and being cheaper.
- jokethrowaway 5y ago
  Cheerios is different product. It's not oatmeal. I buy both oatmeal and cheerios. You can find generics that cost much less though and are pretty much the same thing. I tried in the UK a bunch of Tesco/Sainsbury cereal clones and they're as good as the branded ones, while costing 1/3 (which surprised me, my experience 10 years ago was that generics were significantly worse than the original).