{"id":242764,"date":"2024-07-12T19:30:29","date_gmt":"2024-07-12T19:30:29","guid":{"rendered":"https:\/\/michigandigitalnews.com\/index.php\/2024\/07\/12\/say-goodbye-to-6-cheetos-snack-companies-finally-lower-prices\/"},"modified":"2025-06-25T17:14:50","modified_gmt":"2025-06-25T17:14:50","slug":"say-goodbye-to-6-cheetos-snack-companies-finally-lower-prices","status":"publish","type":"post","link":"https:\/\/michigandigitalnews.com\/index.php\/2024\/07\/12\/say-goodbye-to-6-cheetos-snack-companies-finally-lower-prices\/","title":{"rendered":"Say goodbye to $6 Cheetos\u2014snack companies finally lower prices"},"content":{"rendered":"<p> [ad_1]<br \/>\n<br \/><img decoding=\"async\" src=\"https:\/\/fortune.com\/img-assets\/wp-content\/uploads\/2024\/07\/GettyImages-1325814318-e1720810718334.jpg?w=2048\" \/><\/p>\n<p>One snack giant has finally admitted that $6 for a bag of Cheetos is crumbling consumers\u2019 wallets.<\/p>\n<div>\n<p>After multiple years of raising prices for consumers, PepsiCo\u2019s snack unit <a href=\"https:\/\/fortune.com\/company\/frito-lay\/\" target=\"_blank\" aria-label=\"Go to https:\/\/fortune.com\/company\/frito-lay\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\">Frito-Lay<\/a> is finally feeling them bite back. The company\u2013which produces most of America\u2019s chip favorites, including Doritos, Ruffles, and Lays\u2014<a href=\"https:\/\/investors.pepsico.com\/docs\/default-source\/investors\/q2-2024\/q2-2024-earnings-release_dr90yw4b12khgowp.pdf\" target=\"_blank\" aria-label=\"Go to https:\/\/investors.pepsico.com\/docs\/default-source\/investors\/q2-2024\/q2-2024-earnings-release_dr90yw4b12khgowp.pdf\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">reported<\/a> a 0.5% decline in second quarter revenues Thursday. The drop comes after Frito-Lay saw its net revenues soar roughly $7 billion between 2020 and 2023.<\/p>\n<figure class=\"wp-block-embed is-type-rich is-provider-datawrapper wp-block-embed-datawrapper\">\n<p><iframe class=\"\" aria-label=\"Interactive line chart\" id=\"datawrapper-chart-zeGWg\" frameborder=\"0\" height=\"376\" loading=\"lazy\" scrolling=\"no\" src=\"https:\/\/datawrapper.dwcdn.net\/zeGWg\/1\/\" style=\"border:none\" title=\"The price of a bag of chips has surged in 2 years\" width=\"100%\"><\/iframe><\/p>\n<\/figure>\n<p>Years of persistent inflation have created \u201ctighter household financial conditions,\u201d PepsiCo management said in prepared <a href=\"https:\/\/investors.pepsico.com\/docs\/default-source\/investors\/q2-2024\/q2-2024-prepared-management-remarks_4di6w824y6xvd2kd.pdf\" target=\"_blank\" aria-label=\"Go to https:\/\/investors.pepsico.com\/docs\/default-source\/investors\/q2-2024\/q2-2024-prepared-management-remarks_4di6w824y6xvd2kd.pdf\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">remarks<\/a>. Now, as customers have become more \u201cvalue-conscious,\u201d the snack giant\u2019s performance is \u201csubdued.\u201d\u00a0<\/p>\n<p>Upon this realization, Frito-Lay intends to cut prices for some salty snacks, and expand their marketing for others, PepsiCo chairman and CEO Ramon Laguarta said in a call to investors.\u00a0<\/p>\n<p>\u201cThere is some value to be given back to consumers after three or four years of a lot of inflation,\u201d Laguarta added.\u00a0<\/p>\n<p>Frito-Lay will utilize a now-familiar play to win back consumers, Laguarta said; investing in value-based deals. Multiple food retailers, from fast-food to grocery stores, have begun offering deals in recent weeks to attract value-seeking customers. Like <a href=\"https:\/\/fortune.com\/article\/fast-food-deals-mcdonalds-wendys-burger-king-chilis-starbucks-chipotle-taco-bell\/\" target=\"_self\" aria-label=\"Go to https:\/\/fortune.com\/article\/fast-food-deals-mcdonalds-wendys-burger-king-chilis-starbucks-chipotle-taco-bell\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\">McDonald\u2019s<\/a> new $5 meal, or<a href=\"https:\/\/fortune.com\/2024\/06\/29\/whole-foods-cut-lower-prices-discount-sale-inflation-ceo-jason-buechel\/\" target=\"_self\" aria-label=\"Go to https:\/\/fortune.com\/2024\/06\/29\/whole-foods-cut-lower-prices-discount-sale-inflation-ceo-jason-buechel\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\"> Whole Food\u2019s <\/a>$2 Tuesday rotisserie chickens, Frito-Lay is ready to jump on the trend of bargaining with their customers.\u00a0<\/p>\n<p>\u201cIt seems that customers are gravitating toward where they feel the best deal is right now,\u201d Whole Foods CEO Jason Buechel previously told <em>Fortune. <\/em>\u00a0<\/p>\n<p>Laguarta, in response to multiple peppering comments from investors Thursday, agreed, admitting that \u201cnew entry points\u201d and \u201cnew promotional kind of mechanics\u201d would be necessary for consumers.\u00a0<\/p>\n<p>Some consumers might say that it\u2019s about time. The average price of potato chips in June 2024 was $6.56; a near 30% jump from the June 2020 pandemic price of $5.09, <a href=\"https:\/\/fred.stlouisfed.org\/series\/APU0000718311\" target=\"_blank\" aria-label=\"Go to https:\/\/fred.stlouisfed.org\/series\/APU0000718311\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">according to Federal Reserve da<\/a>ta.<\/p>\n<p>\u00a0And it\u2019s not just potato chips\u2014more than 80% of consumers say that overall, food prices <a href=\"https:\/\/fortune.com\/2024\/07\/10\/viral-photo-of-444-trader-joes-receipt-sparks-new-debate-over-grocery-inflation\/\" target=\"_self\" aria-label=\"Go to https:\/\/fortune.com\/2024\/07\/10\/viral-photo-of-444-trader-joes-receipt-sparks-new-debate-over-grocery-inflation\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\">have increased<\/a> a little or a lot over the past 12 months, according to the <a href=\"https:\/\/ag.purdue.edu\/cfdas\/data-resources\/consumer-food-insights\/?_ga=2.29064188.1715034205.1720537881-121249596.1720537881&amp;_gl=1*jk0qj8*_gcl_au*MTI2NTQzODYwNi4xNzIwNTM3ODgy*_ga*MTIxMjQ5NTk2LjE3MjA1Mzc4ODE.*_ga_PF1CYQ27F6*MTcyMDUzNzg4MS4xLjAuMTcyMDUzODAxNC4wLjAuMA..\" target=\"_blank\" aria-label=\"Go to https:\/\/ag.purdue.edu\/cfdas\/data-resources\/consumer-food-insights\/?_ga=2.29064188.1715034205.1720537881-121249596.1720537881&amp;_gl=1*jk0qj8*_gcl_au*MTI2NTQzODYwNi4xNzIwNTM3ODgy*_ga*MTIxMjQ5NTk2LjE3MjA1Mzc4ODE.*_ga_PF1CYQ27F6*MTcyMDUzNzg4MS4xLjAuMTcyMDUzODAxNC4wLjAuMA..\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">May 2024<\/a> Consumer Food Insights Report from Purdue University. The same report found 37% of chip-loving Gen Zers and millennials say they are going into debt, or whittling away their savings, to pay for food.\u00a0<\/p>\n<p>Additionally, \u201cfood\u201d was the top choice over categories like housing and childcare when consumers were asked which goods and services saw the largest year-over-year price increase.\u00a0<\/p>\n<p>The White House contests the impact of inflation on food prices, making the case that consumer purchasing power at grocery stores has actually increased. Grocery inflation has cooled in recent months, according to a <a href=\"https:\/\/www.whitehouse.gov\/cea\/written-materials\/2024\/06\/20\/update-grocery-price-inflation-has-cooled-substantially\/\" target=\"_blank\" aria-label=\"Go to https:\/\/www.whitehouse.gov\/cea\/written-materials\/2024\/06\/20\/update-grocery-price-inflation-has-cooled-substantially\/\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">recent White House report<\/a>. And, if you narrow the scope to just the past year, at-home food prices have only increased by 1%,\u00a0 <a href=\"https:\/\/www.ers.usda.gov\/data-products\/food-price-outlook\/summary-findings\/\" target=\"_blank\" aria-label=\"Go to https:\/\/www.ers.usda.gov\/data-products\/food-price-outlook\/summary-findings\/\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">according<\/a> to the Consumer Price Index, while wages <a href=\"https:\/\/www.bls.gov\/news.release\/empsit.nr0.htm\" target=\"_blank\" aria-label=\"Go to https:\/\/www.bls.gov\/news.release\/empsit.nr0.htm\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">grew by about 3.9%<\/a>.<\/p>\n<p>Yet, that data ignores the years of persistent price increases from compounding inflation; <a href=\"https:\/\/fortune.com\/2024\/05\/22\/inflation-cooling-cost-of-living-creep-americans-personal-finance\/\" target=\"_self\" aria-label=\"Go to https:\/\/fortune.com\/2024\/05\/22\/inflation-cooling-cost-of-living-creep-americans-personal-finance\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\">since<\/a> 2021, groceries are about 25% more expensive.\u00a0<\/p>\n<p>\u201cThe reason consumers feel like prices are increasing is because they still are,\u201d Kendall Meade, a certified financial planner at SoFi, previously told <em>Fortune. <\/em>\u201cWhile inflation may be slowing down, it has not stopped and we are not seeing disinflation.\u201d<\/p>\n<p>However, falling revenues may be the wake-up call food retailers need to offer permanent price decreases, beyond promotional deals.\u00a0<\/p>\n<p>\u00a0Over the past six months, food companies such as Conagra\u2014which dominates the frozen meals section at grocery sections\u2014have tried to use temporary discounts to woo customers, <a href=\"https:\/\/fortune.com\/company\/bank-of-america-corp\/\" target=\"_blank\" aria-label=\"Go to https:\/\/fortune.com\/company\/bank-of-america-corp\/\" class=\"sc-82aca549-0 klXAci\" rel=\"noopener\">Bank of America<\/a> analyst Peter Galbo <a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/11\/pepsi-conagra-food-prices-inflation\/\" target=\"_blank\" aria-label=\"Go to https:\/\/www.washingtonpost.com\/business\/2024\/07\/11\/pepsi-conagra-food-prices-inflation\/\" rel=\"noopener\" class=\"sc-82aca549-0 klXAci\">told<\/a> <em>The Washington Post.<\/em><\/p>\n<p>\u201cBut a lot of the promotional activity that they\u2019ve put in place hasn\u2019t really worked,\u201d Galbo said. \u201cSo now it becomes a question of whether they need more permanent reductions on price.\u201d<\/p>\n<\/div>\n<p>[ad_2]<br \/>\n<br \/><a href=\"https:\/\/fortune.com\/2024\/07\/12\/say-goodbye-to-6-cheetos-snack-companies-finally-lower-prices\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[ad_1] One snack giant has finally admitted that $6 for a bag of Cheetos is crumbling consumers\u2019 wallets. After multiple years of raising prices for<\/p>\n","protected":false},"author":1,"featured_media":242765,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[149],"tags":[],"_links":{"self":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/242764"}],"collection":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/comments?post=242764"}],"version-history":[{"count":0,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/242764\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media\/242765"}],"wp:attachment":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media?parent=242764"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/categories?post=242764"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/tags?post=242764"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}