The perception that women pay a “pink tax” for products that are seemingly identical to those marketed to men has led to several new and proposed laws with the aim of ending price discrimination.
But the legislation and the outcry assume that the so-called men’s and women’s products are, indeed, the same. New research reveals no significant price differences between comparable products aimed at women and men, he explains Anna Tuchman, professor of marketing at the Kellogg School. Co-authored the study with Sara Moscowari at the University of California at Berkeley and Natasha Batia Akrogoni Research.
“Comparable” is the key word, Tuchman explains. The researchers focused on personal care products, a category in which gender targeting and segmentation is pervasive. “We find that when companies sell products aimed at men and women, they are rarely identical products sold in different colored packaging,” he says. “The prices charged for products aimed at men and women are different, but that seems to be because the products themselves are different.”
In other words, while it’s true that women’s deodorants often cost more than those aimed at men, the women’s version likely has different ingredients. (Moisturizers are especially a common feature of women’s products, Tuchman says.)
It was a surprising discovery for Tuchman and her colleagues. Given the legislative action and media outcry surrounding the issue, “we thought we would find strong evidence” for a pink tax, he says. “But when our results started coming back, it led us to a different conclusion.”
Comparing apples to apples
The researchers began by gathering price information from Nielsen for nine types of personal care products marketed to both women and men: soap, body lotion, deodorant, hair dye, razor blades, razors, shampoo, and shaving cream. They eventually collected three years of data from nearly 40,000 stores in the US
To understand which products appealed to women and men, the researchers used several approaches, which included analysis of manufacturer product descriptions and label design. They also chose one store, Walgreens, to see how products were categorized on its website. They then used a product-ingredient database to compare the similarity of the offerings.
Digging into the ingredients of each product revealed significant differences between what is sold to men and women. This is a breakthrough because the proposed federal pink tax legislation targets “substantially similar” products.
Among the relatively small number of products that were actually compared, “we don’t find large price differences,” Tuchman says. In some categories, there were small price differences between men’s and women’s products, but not always to the detriment of women. Eventually, small differences “wash out across categories.”
In fact, the study found, the average household would save less than 1 percent by switching to comparable products targeted at a different gender. The proposed savings would be greater — nearly 10 percent — if households switched to differently gender-targeted products that also have different formulations, but it’s not clear that consumers actually want to do that. After all, there’s nothing stopping women from buying the cheapest, least moisturizing blue deodorants today—yet many don’t.
In other words, says Tuchman, “there’s not a lot of money left on the table if people really prefer the product combinations they choose.”
No pink tax – just a bigger pink basket
Just because there’s no data on the tax doesn’t mean female consumers are necessarily in the pink.
For starters, the pink tax studied here is different from the debate over whether feminine hygiene products should be subject to a sales tax—sometimes called a pink tax—that many advocates see as unfair. And a combination of marketing and culture requires women to buy a much wider range of personal care products in order to conform to social norms.
“The basket of goods is just bigger for women,” says Tuchman. “Within the basket, individual items may have the same price, but it’s a bigger basket.” While some may consider this unfair, it is a problem that legislation cannot, on its own, easily solve.
Understanding why companies create products with different formulations for men and women is the focus of the researchers’ next work. Why I am doing Do so many women’s products contain added moisturizer—because women want it, or because marketers have created the expectation?
“I don’t have the answers to those questions yet,” says Tuchman, “but I think it’s extremely interesting.”
