PepsiCo is aiming to cut prices on some of its well-known snack products by as much as 15%, a move that comes as families across the country complain about cost-of-living issues and inflation.
Because retailers set prices in stores, PepsiCo is implementing suggested changes it expects retailers will follow to attract more customers, according to the Wall Street Journal. The move comes ahead of snack-heavy Super Bowl parties this weekend.
Rachel Ferdinando, CEO of PepsiCo’s U.S. foods, said that the company has received a lot of calls and emails from customers who said the cost of some snack items were making it difficult to afford them.
“Consumers told us they need more value,” Ferdinando said.
Several of PepsiCo’s iconic offerings are being affected by the price change suggestions. For example, the suggested retail price for a 9.25-ounce bag of Doritos would drop by 80 cents to $5.49. Also, an 8-ounce bag of Lay’s Classic Potato Chips would drop from $4.99 to $4.29, a roughly 14% decrease.
Inflation and cost-of-living concerns are still weighing heavily on consumers, who have been grappling with the cumulative effects of years of high inflation, which began spiking during the COVID-19 pandemic recovery under former President Joe Biden.
Overall inflation has stabilized in the past year to below 3%, far from the highs notched during the pandemic recovery. Still, it is running above the 2% level the Federal Reserve considers to be healthy.
The new changes will be advertised on the packaging of PepsiCo products, noting that the size of products hasn’t changed, but the prices have. That is notable because, particularly during the post-pandemic inflation wave, some accused companies of “shrinkflation,” a portmanteau of “shrink” and “inflation,” which became a popular accusation from Democratic politicians that corporations were cheating consumers by giving them less product for the same price.
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The upcoming Super Bowl, a rematch of the 2015 championship game between the New England Patriots and the Seattle Seahawks, is a cash cow for the NFL and for industries associated with the game, like the snack food industry.
Savory snack food sales reached $742 million during last year’s Super Bowl week, accounting for more than half of the $1.3 billion in total snack sales for that week, according to Circana data commissioned by SNAC International.
“These results highlight not just the strength but the unstoppable momentum of the snack industry,” said Kelly Knowles, interim president and CEO of SNAC International. “From beloved salty staples like chips and pretzels to surging favorites like cheese snacks and popcorn, consumers are fueling dynamic growth across the entire aisle.”
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The Seahawks, who lost to the Patriots in 2015 after an interception in the final minute of the game, are the betting favorites in Sunday’s matchup.
The Washington Examiner reached out to PepsiCo for comment and further details about the changes.
