this post was submitted on 19 Oct 2023
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Veganism
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Perhaps demand?
Might have something to do with economies of scale. If they sell a lot more of the popular version it may be cheaper to produce and ship in bulk than the less popular version.
Sort of like buying 12 packs of something is almost always cheaper per unit than buying 2 packs.
This would make the most sense, until you look at sales and revenue.
Plain cheerios is still the company's best selling cereal (the best selling of all cereal ever), followed by honey nut. Outsell honey nut by 10 million boxes and having positive higher year-over-year sales (vs shrinking sales for honey nut). SOURCE
Despite selling 10 million more boxes, original cheerios makes the company $14 dollars more, so they have a higher profit margin.
The mystery continues, or perhaps I just solved it. General Mills doesn't have to sell plain cheerios for less, because there's no profit incentive to do so. ๐ค
Perhaps just corporate greed then. They know they can charge more and people will still buy it, so they do. Actually they could probably charge even more per box and make more money, and even if demand drops a little because of it that won't matter much because they won't have to produce and ship as much, saving more money.
Price elasticity Look it up.
They're charging more for the plain product just because they can. Next door's competitor can make a better product, at a lower price, and people still won't switch.