Page 115 - Bloomberg Businessweek - November 19, 2018

Bloomberg Businessweek The Year Ahead 2019 Consumer

Solution
Stealth Pricing

▷ Companies go to great lengths to get consumers to spend more on goods

Adidas’s Yeezy
The 2019 Ram Desert Rat 500 in
1500 truck’s large “salt” is expected
touchscreen is hot to drop on Nov. 30

American Airlines
started premium
economy in 2016 41

● FASHION DROPS make shoppers throw bottles that can cost up the latest monthly data a massive 12-inch a larger video screen
fiscal prudence to the to six times more per from market researcher touchscreen. It’s an is only incrementally
After growing into winds and, for instance, ounce than sodas sold Kelley Blue Book. That almost $8,000 option above what the
multibillion-dollar shell out almost $600 in traditional 12-packs of was up 3 percent—more on some models. companies spend
businesses by for the latest Burberry 12-oz. cans. than $1,100—from a Or Ram buyers can outfitting cattle class.
expanding their range sweatshirt. Still, companies have year earlier. upgrade to the Limited ——Justin Bachman
of products and the ——Robert Williams to be careful. Some U.S. consumers’ Crew Cab trim line and
number of locations customers may notice shifting preference get it included—raising
where they’re sold, the changes in a favorite toward SUVs and the price to a hefty ● WOMEN’S BRANDS
European luxury ● SHRINK-FLATION product—and not be trucks has a lot to $57,390. ——Craig
brands including Louis happy. In 2016, after do with this, but so Trudell, Keith Naughton, Some companies have
Vuitton and Burberry Sometimes less Mondelēz International does the rise of tech and Gabrielle Coppola found a potent way to
Group Plc are racing really is more. Just Inc. tweaked its bars and safety systems get higher prices for
to put scarcity back ask companies that to reduce the grams of that companies goods: target them to
in the equation. shrink the size of chocolate to cut costs, bundle within options ● PREMIUM ECONOMY women. A study by the
Streetwear’s “drops” products to keep angry fans complained packages and custom New York City Depart-
are the inspiration—the prices stable but still on the company’s trim lines that can The various indignities ment of Consumer
special releases that hold on to customers. Facebook page. In 2018, swell a sticker price by airlines proffer in Affairs found that
have Generation Z-ers With so-called shrink- Mondelēz reverted to thousands of dollars. steerage—mashed women pay 13 percent
camping in line for flation—a strategy used the original size. In the past, knees, jousting elbows, more than men for
skateboarding brand on products including ——William Mathis carmakers got buyers uninspired cuisine— personal-care products
Supreme or spending ice cream and candy— to dish out that kind of leave many travelers in the city. Online
$200-plus on Kanye every unit sold earns money for comforts deeply unhappy. And retailer Boxed.com,
West “Yeezy” Adidas a little more than it ● AUTO BUNDLES including leather with today’s increasingly which calls this the
sneakers. used to. seats and sunroofs. plush business class “pink tax,” has said
Burberry is selling In the U.K., where a The best times for the Lately, they’ve gotten too expensive for most that on a per-ounce or
its latest logo tees and weak pound has raised U.S. auto market are customers to pay for travelers, U.S. airlines per-unit basis, women
hoodies in 24-hour food and raw-material widely viewed to be in touchscreens and are beginning to offer sometimes pay up to
flash sales. Puffy- prices, candies such the industry’s rearview driver-assistance premium economy double the price for
coat maker Moncler as Mars Inc.’s Snickers mirror. Sales hit an systems with features sections on many razors, 10 percent
SpA has canceled its have shrunk. Nestlé SA’s annual record two years such as lane centering international flights. more for body wash,
fashion week runway Häagen-Dazs brand ago, and an industry and automatic braking. Financially, premium and 8 percent more
collections in favor reduced the size of its that’s as cyclical as they Take Fiat Chrysler economy is a home run for deodorant. As
of monthly drops, “pint” containers from come probably will keep Automobiles NV’s new for most carriers that part of its marketing,
collaborating on limited 16 ounces to 14 oz., downshifting in 2019. Ram 1500 pickup. sell it: Fares are roughly Boxed lowers the
runs with a rotating cast keeping prices even. Yet Detroit is managing While the base model double regular economy price of such goods to
of tastemakers such Sometimes the tactic to bring in more revenue can be had for $31,695, prices and sometimes offset the gender price
as Japanese designer- can be considered a despite shrinking sales. you’ll have to fork much more, while the premium and labels the
slash-DJ Hiroshi product innovation. The average new car over a lot more to cost to airlines for a few products as “pink tax
Fujiwara. Brands are Coca-Cola Co. cost more than $37,000 get one of the truck’s extra inches of legroom, free” on its website.
betting that rarity will introduced 8.5-oz. in October, according to biggest selling points: slightly nicer meals, and ——James E. Ellis