Dodgy Pricing by Hindustan Unilever

28 06 2008

My wife recently bought two different size packs of  otherwise identical Clinic All-Clear shampoo. One was a 100ml pack and the other a 40ml one. Both had 02/08  as the date of packing and neither of them had any promotional offer. The 40ml pack is priced at Rs. 15.  Conventional logic and traditional fair pricing practice demand that the 100ml pack should be priced at Rs. 37.50 or less as usually bigger packs are usually cheaper.

 

But what did I see? The price tag on 100ml pack said Rs. 69.  I checked the number twice. Nothing was amiss. Now tell me why should anyone buy a 100ml pack when she can get four 40ml packs at Rs. 60 and will still be left with Rs 9 ?

 

Is it skirting the laws  (if not in letter then in spirit) on weights and measures or is it an honest mistake or is it   HUL’s pricing strategy to exploit different price elasticity of different?

 

 

(Marketing students may like conceive a project to compare the SKU level prices of various FMCG products and discover such anomalies. Maybe, there is some method in this madness.) 

 

 

 

– G. Mohan.

 

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2 responses

29 06 2008
Balasubramanian

Dear Mohan,

This is mainly because the penetration of Shampoo in India is ~45% and to woo more consumers to use shampoos the small SKUs will be kept at lower price and the bigger SKUs will be little higher. This is not only from HUL but other shampoo sellers also used to price this way only.

8 07 2008
Raghuvir

This sort of pricing has been going on, at least in this category, for quite some time. I guess many people buy bigger packs ‘assuming’ that it will be cheaper than buying multiple smaller ones ….

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