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Sneaky, Sneaky Ice Cream Companies

By JLP | April 29, 2008

Well, it now looks like 1.5 quarts is the new “1/2 gallon.”

Based on the information provided in the Consumerist post, that represents a 16.7% price increase! How so? Check this out:

Previous Price Per Quart:

$5.99 ÷ 1.75 quarts = $3.42 per quart

New Price Per Quart:

$5.99 ÷ 1.50 quarts = $3.99 per quart

Percentage Price Increase:

($3.99 – $3.43) ÷ $3.42 = 16.7%

To put that in perspective, these same ice cream companies would now have to charge $8 for a 1/2 gallon of ice cream if the size stayed the same and they just raised prices. Right now Blue Bell sells for around $6.30 for a 1/2 gallon.

Size reductions are very sneaky because most people don’t do the math.

Topics: Budgeting | 15 Comments »


15 Responses to “Sneaky, Sneaky Ice Cream Companies”

  1. Experts on Credit Says:
    April 29th, 2008 at 5:12 pm

    Funny — I went to the grocery store two days ago looking for ice cream. Almost all ice cream products were on sale… and I thought it was because of the weather.

  2. Adam Says:
    April 29th, 2008 at 7:44 pm

    As I posted on the Consumerist, we didn’t even notice at the store last night. It wasn’t until we got home and tossed it in the freezer alongside an almost empty container we bought a few weeks ago that we noticed the rather drastic downsizing.

  3. RichSlick Says:
    April 29th, 2008 at 9:18 pm

    See, now the government can report that inflation is at zero percent for the month of April.

    http://www.getrichslick.com/2008/04/14/inflation-at-zero-percent-and-i-have-proof/

  4. Customers Revenge Says:
    April 30th, 2008 at 8:39 am

    The sad thing is that now they wrap the packaging around 17% less product and incur practically the same shipping, distribution, and overheads on less.

    It isn’t really a scam. They probably aren’t lying about the size of the container, but it does seem like a way of sneaking a price increase in there.

    My grocery store usually puts in a $/unit on the pricetag to make comparisons easier. In that case you would see a price increase week over week.

  5. Philip Says:
    April 30th, 2008 at 8:48 am

    The $/unit is good, but not if you think you are getting the same thing you hvae been, you just grab it automatically. I understand why companies do this, but it does irk me when I catch it.

  6. Apollo Says:
    April 30th, 2008 at 8:49 am

    As noted in the comments on Consumerist, an apple is being compared to a flea collar.

    One carton is Yogurt.
    The other carton is No Sugar Added Ice Cream.

    Personally, I don’t really know which one should cost more, but it doesn’t suprise me that two different products don’t cost the same.

    Your math is good, but the premise is flawed.

  7. JLP Says:
    April 30th, 2008 at 8:57 am

    Apollo,

    I didn’t realize that they were looking at two different products. However, it’s just a matter of time before the entire product line is reduced. Companies don’t usually reduce the packaging on just one product. It won’t be long and all their products will be the same size.

  8. TheMightyQuinn Says:
    April 30th, 2008 at 9:36 am

    Companies pay a lot of money to research what people want. They’ve figured out that there are “price points” for certain items. They try to maintain those price points, even when their costs go up, by reducing the size.

    That being said, I shop by looking at the lowest price per size (weight, volume, etc) and I buy the cheapest one (as long as I find the brand acceptable.)

    But then again, I can’t remember the last time i bought ice cream in the grocery store!

  9. Nick @ RBCp2p Says:
    April 30th, 2008 at 9:50 am

    I like that you mention size reduction and how people don’t usually notice when it happens. I am notorious for noticing when things get smaller but the price stays the same (or sometimes increases). I’ve noticed that Five Alive (and other Minute Maid bottled juices) have gone from 473ml to 450ml. They used to come in glass bottles (at least where I live) and now come in (smaller) plastic bottles.

    I know 23ml is such a small difference, but it’s done in small increments a couple of times and all of a sudden you have a 25% decrease in what you’re getting but still pay the same or more. It’s good to keep an eye on that sort of thing.

    As for the ice cream, I wrote a piece last month that might explain why the price is going up. If you’d like to check it out you can go to http://blogs.rbc.com/rbcp2p/2008/03/thought_for_food_1.html and it’s the very first section.

    Nick
    RBCp2p

  10. Rick Says:
    April 30th, 2008 at 9:52 am

    Well, you could just make your own ice cream, but the costs are a bit more.

    1 pint heavy cream ($2)
    1 qt of half and half ($2)
    8 egg yolks ($2/carton eggs)
    9 oz sugar (pennies)
    1 vanilla bean ($5/bean)

    (i’m guessing from memory)

    It’s soooooo good and not full of air like most bargin ice creams but your costs are about 12 bucks to make it with some leftover ingredients. This is the real macoy and a pleasure to make and moreso to enjoy.
    Rick.

  11. JLP Says:
    April 30th, 2008 at 10:01 am

    TheMightyQuinn wrote:

    “Companies pay a lot of money to research what people want. They’ve figured out that there are “price points” for certain items. They try to maintain those price points, even when their costs go up, by reducing the size.”

    I have had companies tell me this before but I’m not buying it. I think this is a way for companies to raise prices without making it look like they are raising prices.

    Besides, are customers really that stupid that they don’t really see what’s going on?

  12. TheMightyQuinn Says:
    April 30th, 2008 at 11:19 am

    JLP Says:
    I have had companies tell me this before but I’m not buying it.

    I don’t think I can convince you, but it makes sense to me. I see two scenarios:
    1) I want ice cream, it’s $5, I buy it.
    2) I want ice cream, it’s $8, I wonder, “do I really need ice cream?”

    Some people really don’t see what’s going on, but most people aren’t hanging out on financial blogs. :)

  13. JLP Says:
    April 30th, 2008 at 11:25 am

    Quinn,

    That’s the thing:

    WE NEED MORE PEOPLE HANGING OUT ON FINANCIAL BLOGS!

    Seriously, I see your point. However, won’t these same people be thinking, “How the heck am I already out of ice cream? I just bought ‘1/2 gallon’ last week!”

  14. mark Says:
    June 2nd, 2008 at 11:12 pm

    Look art it this way, the 1/2 gallon didn’t get smaller, the quart got bigger!

  15. Deb Says:
    November 30th, 2008 at 2:13 pm

    This is just inflated prices on all products that do this. It’s to the point that I’m now changing brands of many items due to smaller sizes and inflated prices on each of them. Noticed the ice cream this past summer but that’s not all. Folgers inflated prices from on sale of $3.99 per 33-34 oz can to $10 plus per can and hit you on the blindside with smaller sizes, the can size went down to 27.8 oz. Changed brands until they begin selling them at $5.99 on special again. But you are still paying a higher price for less product. All of these companies are inflating prices and telling themselves it is due to higher gas prices, etc. Well, what the hey, gas prices are down. Do you think they will lower their prices? Nope! UPS just sent out a notice that they are going up another 5+% and they were the first to add fuel charges to shipping costs. They began by going up once a year, and now may go up two times per year. Palmolive dish detergent just changed their bottle size of 28oz down the 25oz and to kick you while you are down, they have gone up $1 on each bottle. The cost of everything is going up, wages aren’t! Bottom line, people out of work, recession going like gangbusters, consumers being hit left and right by every price being inflated. This is what happened to the greedy bankers, brokers, & realtors that inflated the cost of housing due to low interest rates, they were not happy with lots of biz, they had to have more. Now look at the bailout that we may never pay for. This could and may destroy the USA worse than the previous 8 years has done.
    Folks, it is time to say NO to all of these price increases! Change brands, let those companies know that you see what they are doing. Gas prices are down, they can take less profit to avoid losing companies completely. Those CEO’s can take either a hike or pay decrease! It is time to say NO!
    Thanks for letting me rant, I for one am changing brands and letting each company know why.
    d

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