Ben and Jerry’s Ice cream – Pricing

I know Ben and Jerry’s is own by some big corporation now, but it used to be it’s own company. My favorite treat/desert is probably ice cream, even when it is cold and rainy out I found myself going to the freezer for some. Ben and Jerry’s is my favorite brand of ice cream because their ice cream is delicious and I have never had a bad tasting ice cream from them. My favorites are Cinnamon Bun, Fish Food, and Half Baked. I would consider Ben and Jerry’s a premium ice cream.

The “problem” with Ben and Jerry’s pricing is that they discount (or allow to be discounted) their ice cream. I understand the retail outlet is usually the one pushing the promotions on items, but if I were Ben and Jerry’s I would not let my ice cream to be discounted. Sure one store might sell the ice cream for a little less or a little more than the other guys, but to offer promotions where the ice cream is discounted by 50%+ might not be the right strategy. I caveat my recommendation with the fact that I am just one consumer and may not represent their best customer.

The thing with me is that I know Ben and Jerry’s will go on sale every once in while at one of the three grocery stores I shop at. Ever since I purchased the ice cream at $2.50 to $3.00 a pint, I never want to pay more than that for it. So instead of purchasing Ben and Jerry’s more regularly, I will substitute with other ice cream makers until Ben and Jerry’s goes on sale. In order for Ben and Jerry’s to get me to purchase more ice cream from them, they would have to prevent sales/promotions of the ice cream and sell it slightly lower than their normal price, which is usually around $4 to $5 a pint. If this were the case I would be more exclusive to Ben and Jerry’s and would therefore be purchasing more of their ice cream. I would suggest a price of $3.75 with no promotions.

That being said, this pricing change may not maximize Ben and Jerry’s revenues. There may be plenty of people out there who are not as price sensitive to Ben and Jerry’s standard price. There may be so many price inelastic customers that by lowering the normal price slightly, Ben and Jerry’s would lose more money on the people who buy regardless of the price than the added revenues they receive from customers like me. Writing this post makes me hungry for ice cream. 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s