Americans' new fondness for frugality prompts P&G to cut prices
Filed under: Bargains, Home, Shopping, Recession
It's been a tough decade for debt-laden consumers, and things aren't getting any easier. Rising unemployment, tumbling home values and eroded retirement portfolios have driven many U.S. households to forgo freewheeling spending and instead cut back on expenses whenever and wherever possible.Consumer-products giant Procter & Gamble has taken note of Americans' newfound fondness for frugality and is doing a little cutting back of its own -- on prices, that is.
Unwilling to bet the bank that consumers will pick up their spendthrift ways once the recession ends, P&G said Thursday it's cutting prices on about 10% of its global product lines.
Rather than leading consumers by the nose, P&G instead is opting to follow their lead. Given the current state of consumer spending, which emphasizes price and value, it is a decision the Cincinnati-based company had to make, said Robert Passikoff, president of Brand Keys Inc., a customer research marketing firm.
"We've seen this shift coming even before the economy went to hell," Passikoff said. "With the economic downturn, more attention has been called to it."
P&G isn't only resorting to cutting prices to stem a months-long slide in sales of its products. It's ramping up promotions that emphasize value and introducing new products, such as a lower cost version of its Tide brand of laundry detergent, the market leader and a perennial winner in Consumer Reports tests.
A cheaper Tide is just one move among several P&G is planning for its laundry detergent lines. The company is also cutting the price of Cheer by 13% and will begin promoting it as a bargain brand.
The economic downturn has helped P&G in one area -- cheaper advertising rates. That means it can buy more ad time to promote its products, a strategy that has already helped to boost sales of Tide, Charmin toilet paper and Bounty paper towels.
For consumers, who are likely spending more hours in front of the TV rather than dining out or taking in a movie, that likely means they'll be seeing many more P&G commercials pitching products.
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Reader Comments (Page 1 of 1)
9-11-2009 @ 8:50PM
MustangWriter said...
Iiiiiiiiiiiiiiiiiiiiiiiiiiiiii dont know. I'm skeptical.
You cut prices on toilet paper....but the inside cardboard tube's circumference has gotten bigger. We'll see.............we'll just see.
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9-11-2009 @ 8:52PM
cyaml said...
It's about time prices went down on products.
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9-11-2009 @ 9:44PM
Bill520 said...
Has it gotten cheaper for them to manufacture, or where they ripping us off all these years
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9-11-2009 @ 10:21PM
Jean S said...
All companies are cutting the amount of product they put on the shelves but still charge the same price. Example I buy Purina cat chow, the bags used to weigh 17 lbs now it is a 16lb bag at the same price. Some may be cutting prices but we are getting less for our money.
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9-11-2009 @ 11:03PM
Gregory Dittmer said...
One of the very first products I remember playing the game of shrinking sizes years ago was fabric softener. Suddenly the new and improved fabric softener was watered down so you had to use twice as much product, but the bottle size and prices never went down. Now years later they have been making SUPER softener where you only need a capful... just the same as it was so many years before except this time, the bottles have gotten smaller while the prices have gone up.
They shrunk the size of ice cream containers, yet the price remained the same... cat food went from 5.5 - 6 ounce cans down to 5 ounces, just like the more recent move with tuna fish. What makes tuna fish suck double though is how they process the meat. It used to be when you bought "chunk" tuna, whether white or light, there were actual chunks maybe an inch or more across and "solid" light or white was an actual slice of filet packed in a can. Now the "chunk" is literally mush and the "solid" is what used to pass for "chunk."
Now days they have "mechanically separated" meats for canned tuna, hot dogs and bologna which makes for an interesting mixture of bone fragments and grizzle.
In some cases, progress really sux!
9-12-2009 @ 12:56AM
jnjarnold said...
I hear ya loud and clear Jean! I usually buy those boxes of Jimmy Dean sausage egg and cheese biscuits mostly for my husband who is disabled and needs to have quick fixes like this around the house. They started out with 8 to a box for $6.98, then went down to 6 per box at $6,98.....but I went into the store the other day and ALL Jimmy dean offers NOW is a half-arsed 4 little bisucits! .....give you 3 guesses what the price was, and the first two don't count! Yeah.....$6.99 for LESS and LESS!!!!
I see this kind of thing going on in every sector of our economy.....kind of reminds me of that chapter in the book '1984' where news streamed in daily about how choco-rations needed to be in place and would only be given dependant on the effects of the ongoing war that day. Then the next day, the people were told another thing altogether. At a certain point, the society completely lost all ability to keep up with the yo-yoing, lies and spewing out of new information.
When you go to the store to buy another box of 'new and improved' tampax, only to find they've stiffed you by 3.....(at least it was that many extra when I bought them years ago)...that's what I'm talkin about!! We're not getting ANY better deal out there.....the directors of marketing (fleecing) have got it all down pat and what can ya do about it?
Yeah, Jean.....I know what you mean!
9-11-2009 @ 11:07PM
Bill said...
My daughter lives in Albany , NY. Last time I went to her house her toilet paper was one half an inch less wider than usual.
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9-12-2009 @ 5:00AM
Lynn said...
Bill.........I live in FL but your daughter & I obviously buy the same brand of toilet paper...I bought a new package of it yesterday & when I replaced the roll I noticed that it looked funny...so I compared a sheet of it to 1 off of the old roll & it is a half inch less wide...instead of being the perfect square, now its almost rectangular...yet the price remains the same
9-11-2009 @ 11:11PM
william morehouse said...
That's it! Add water to Tide and cut the price!
I bought Dial bar soap recently and it had the back of the bar
so carved out I can hardly hold onto it. Plus it turns to
mush when it gets wet. I have a bar from last year that's
not like that. What about those 124 oz gallons of paint? The
can is the same size as the full 128 oz cans! How can they calculate the rate of inflation with all this going on? Tuna-
5 oz down from 6 1/2 oz- can't even make 2 sandwiches any more. Geesh!
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9-11-2009 @ 11:56PM
bob said...
tide has got real expensive lately,13.00 for a 100 o z liquid size is unreal today,i have switched to cheaper washing detergents and see no big difference ,companies try now like in ice cream use to be a half gallon,then its now down to like 48 oz size and the price is the same or more,whatver happend to a pound can of coffee,they slowly reduce the size on products and keep the prices the same while peoples wages stay the same of drop,the ceos of these companies you can beleive are not hurting any,lets reduce the size of their compensation packages and salary and let them have the same or more demands on their jobs like they do their workers,down with ceos ,they for the most part are crooks ,they rob from the consumers and rob their workers while they stay rich,ceos are the main source i believe of high prices in things to keep them rich while you get less
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9-12-2009 @ 1:33AM
Willie said...
These people are all right. They cut quanity, but keep the price the same!! They aren't cutting prices, and they are stupid to think the public is buying their little mind games they try to play! I am 70 years old and I've seen this go on for years. same old game playing. Hell, we used to get a candy bar 3 times the size they are now for a nickle!!!!!! And a penny piece of bubble gum was big enough to make a wad in your mouth!! Etc., on ALL this crap. A pound of coffee is now 13 oz. 5 ld. of sugar is now four. It is sickening, as to how much has changed...........for the worse!!!!!!!
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9-12-2009 @ 1:54AM
Bagman520 said...
Soap & t.p. eh? All you have to do is open your mind a little, and shop around. I buy the 12-pack of Ivory Soap - which by the way is why at the age of 57 my skin doesn't look that old - when it goes on sale for $6.99 at my local Rite-Aid. I just have to keep an eye on the circular that comes every week in the Sunday paper to know when it's on. I bought it again the next time it was on sale for that, and because I have gone to what I think is the much more economical liquid hand soaps I'm still working on that original 24-bar supply. I bought a gallon of "real" Softsoap brand anti-bacterial at a local Grocery Outlet store. I don't remember exactly when that was, but it was cold outside then, and I haven't used it all yet. The whole gallon jug was just $8.99 and just last week I found another brand of anti-bacterial lotion soap at another store for just $7.00 for a whole gallon. And one day, I had to do a load of laundry and realized that I didn't have the whole cupful of regular laundry soap that I needed. Well, I had bought some of those new self-dissolving packets of dishwasher soap and had a few of those under the kitchen sink. Well, I thought, soap is soap. So I used one of the packets for that load of laundry. Worked fine. I kept my eyes peeled for a bargain, and I sure did find one. A 36-tablet pack of what is branded and labeled "dishwasher detergent" for just $2.99 each. That's 72 loads of dishes and laundry for *Six Bucks*!! I live alone, I do laundry just 3 or 4 times a month, and run the dishwasher about twice a month. That's 24 months - two whole *years* - of average use of two household appliances for Six Lousy Dollars!!
About the TP. Just keep your eyes open. I got a 12-roll pack of "real" Scott tissue 1,000 sheet rolls for $6.99...*plus* I had a 50-cents off coupon. 12 rolls...I live alone, so it should last me the better part of a year...for $6.49!!
An open mind that told me that soap is soap, a little diligence in looking for a bargain, and a little luck that brings you the right bargain at the right time goes a long way during this tough time.
Good luck to everyone, and happy bargain-hunting.
Bernie520
Seattle, WA
Reply
9-12-2009 @ 2:32AM
Glenn said...
I recently bought a package of Bounty paper towels made by Proctor & Gamble. They were marked "12 BIG rolls=16 regular size rolls. When I unpacked these new BIG rolls & put them away, I discovered that these new BIG rolls were a full inch smaller than the ones I still had left.
This is not just a deal to make more money by P & G to charge the same amount for less product. There is a government connection. Many retirees & those on social security have their pensions tied to the cost of living, which is determined annually by the Dept. of Labor. If the Dept. of Labor claims a decrease or no increase in the cost of living, that gives them the legal right to reduce government pensions & limit Social Security to the same amount as the previous year. And somehow the Dept. of Labor knows in advance that for the next 3 years there will be not increase in the COLA for those on Social Security. So seniors are getting hosed twice.
When you see that you are getting less product for the same amountr or a higher cost, call the company & complain. Tell them that what they are doing is deceptive trade practices & you will no longer purchase their products. If enough people complain maybe they will knock this off or send you a coupon to make up for shorting you.
Reply
9-12-2009 @ 2:39AM
Daddy said...
I doubt their cutting prices. I remember a few years ago the made the hole in their shampoo xcap just a tine bit bigger and bragged they made millions. Buyer Beware
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9-12-2009 @ 5:47AM
b. said...
That's really kind of P & G considering they raised prices on these products only about 6 months ago in an affort to keep profit margins up. I guess they discovered that people were not willing to pay a premium for their products in these tough times. I used to use only Tide all my life until recently when the price went to outragous levels. Now, I use Arm and Hammer. I can get 2 of them on sale for half the price of Tide. Sometimes being good to consumers pays off more than just considering the bottom line. It may be too late for P & G, though, as many people won't switch back.
Reply
9-12-2009 @ 6:02AM
Sheryl said...
Yes, Barbara, we can all tell you make so much money. What a B.S. line. Maybe next time you should proof read your comment and make sure all the correct words are used. This is such a scam and truly all of America would believe that a mother of three can make more money than she can imagine. Dream on, at least you must have been well compensated to start this "revolution" that only the gullible will reply.
Reply
9-12-2009 @ 6:16AM
Sheryl said...
First of all, for all you "bargain" hunters, there are bargains out there, there are coupons out there. Stop complaining and just make a stand, don't buy. If everyone who truly was disappointed in a product(s) stopped buying it, then the message gets through. If you don't like the fact that companies are "skimping" go to the dollar store where if you look hard enough you get a bargain and at only a $1 who would have thought. People tend to stock pile things they don't need everytime a "storm" hits, and then guess what? They don't even come close to needing the "important" stuff. Toilet paper, yep you can't even flush it in a real storm when the power and water goes out. So? What's that all about? The consumer has allowed big companies for a long time to profit from our lack of real intelligence. How do you think all the advertising and marketing really get paid for, yes, your foolish $ spent on their highly priced items, for ever.
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9-17-2009 @ 12:18PM
Mary said...
Heads up folkes ....Bottom line to all this is more money ...not for us but all the companies out there ...just remember somethings out there are no bargins ...the companies are not lieing to us they have it printed on the packages how much it weighs,how much is in there and so on ...only thing I know is we are all getting the same thing ...lol..bend over when entering the store cause you are going to get screwed .
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