Is trickflation Coca-Cola’s secret ingredient?
At least one Reddit user didn’t understand what all the fuss was about. They wrote: “If it’s the same size and now costs more money, isn’t that just regular old inflation?”
Trickflation may be a catchy term, but that Reddit user is arguably right. Even Coca-Cola seems to know this.
The company’s executives mentioned the word “inflation” 36 times during a 67-minute investors’ call in February, according to Quartz. By comparison, the word was only mentioned five times during a recent PepsiCo investors’ call.
The majority of Coca-Cola markets saw only a 3.5% increase in inflation for their drinks during the fourth quarter of 2023, according to CNBC. In July 2023, the company saw that European and U.S. consumers were switching to cheaper brands, so they stopped raising prices for the rest of the year.
Despite inflation, Coca-Cola’s global sales rose by 7% in the last quarter of 2023. Meanwhile, CNBC said that its North American volume fell by 1%.
However, according to CNN, the slimmer soda cans are gaining in popularity for an entirely different reason: manufacturers are looking for innovative ways to easily stock (and transport) more product — and the slimmer cans are seen as less cumbersome.
Scammers are smarter than ever—are you protected?
The average American gets 2 scam calls and 3 scam texts every week. Think you can spot them? AI is making scams harder to detect, and in 2023 alone, Americans lost $12.5B to cybercrime. Don’t be next—learn how to protect yourself now!
Learn moreThe soda tax effect
Many Redditors scoffed at the 123% increase in price for a can of Coke. But they gave @inasimplerhyme the advice that they may need to cut the pricey soft drink out of their life.
Granted, Coca-Cola didn’t increase its prices to help curb people’s soda-intake habits, but it just may have the unintended “soda tax” effect. This means that there’s an extra tax on sugary drinks, according to the Tax Foundation.
The problem with a soda tax is that, while it may help decrease the sugar intake of consumers, it also reduces economic consumption. Coca-Cola’s price hike may mean that people end up spending less on their products — as the company noticed back in July 2023.
Consumers may ditch soda altogether, or drink cheaper, off-brand alternatives as a way to cut costs. Either way, this brings down tax revenue for the government, the Tax Foundation explained.
However, the soda tax doesn’t always work. As another Reddit user wrote: “It’s crazy [that] people complain about the price, but keep buying it. That’s not how change happens.”
The richest 1% use an advisor. Do you?
Wealthy people know that having money is not the same as being good with money. Advisor.com can help you shape your financial future and connect with expert guidance . A trusted advisor helps you make smart choices about investments, retirement savings, and tax planning.
Try it now
