PEP-Q, the Company Behind Gatorade, Focuses on Higher Prices

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The curious incident of the shrinking Gatorade in the night-time of high inflation

In earnings calls, PepsiCo management no longer talk as much as before about higher costs forcing them to raise prices. Rather, the company covets higher prices because it wants to – and because it can. Chief executive officer Ramon Laguarta says PepsiCo is “trying to create brands that can stand for a higher value, and consumers are willing to pay more for our brands.”My intrepid reportage led me not just to PepsiCo but also Walmart Inc.

That’s why the same Gatorade can now yields one litre less in drink, Ms. O’Sullivan said. The reduction “has nothing to do with inflation.” Rather, the serving size was simply “optimized.” “Many either shrinkflate their major product or advise consumers to use more of it, and that appears to be the case with Gatorade,” he said. “Shrinkflation – but instead it’s more like usage-flation.”Then there is the matter of how the Gatorade can was advertised.

You buy another can now, from the same website showing the same listing, with the same picture of the can . Unfortunately, probably not. Neither I nor the experts I consulted ever doubted the legality on the part of Gatorade, which did clearly label its product. But pointing out the problem to the Competition Bureau could contribute indirectly toward changes on the policy front, Prof. Quaid said.

 

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