'PSL tax': Here's how much more you'll pay for pumpkin spice
If you are a fan of pumpkin spice, you might want to sit down for this news.
Retailers charge an average of 7.98% more for pumpkin spice products, a new MagnifyMoney analysis found. In the limited study, MagnifyMoney reviewed roughly 200 pumpkin spice-flavored items online and at several New York City grocery stores and coffee shops in late September. Consumers often pay a premium — up to 133 percent in one store reviewed — on pumpkin-flavored products.
The analysis revealed a few important things about how retailers price seasonal products. MagnifyMoney’s key findings:
Trader Joe’s was the worst pumpkin spice tax offender. Trader Joe’s will appear several more times in this article, as the millennial-centric retailer charged the highest average premiums on its pumpkin-flavored products. The retailer registered three of the highest pumpkin spice tax rates in the study.
Across 10 products reviewed at Trader Joe’s, MagnifyMoney found an average pumpkin spice tax rate of 62%.
Among the highest-taxed items was Trader Joe’s Pumpkin Pancake and Waffle Mix. Thirty two ounces of Trader Joe’s Buttermilk Pancake and Waffle Mix is priced at $1.99, but the Pumpkin Pancake and Waffle Mix is priced $1 higher, at $2.99 for just 21.2-oz, almost 10 fewer ounces. Based on the sticker price alone, shoppers may think they paid 50% more for the pumpkin spice version.
Not that bad, right? Wrong. On a price-per-ounce basis, they paid more than twice the price — an effective pumpkin spice tax rate of 133%.
Shoppers often pay more for less. Many retailers charge a higher price for seasonal items, but give shoppers less product for their money.
You may not notice the difference in pricing between Nabisco’s Oreos vs. the pumpkin spice version if you’re busy shopping with the kids. On Target.com, both products bore the same sticker price: $2.99. However, the pumpkin spice version came with just 10.7 oz. of cookies, much less content than the 14.3 oz. original variety. On a price per ounce basis, the pumpkin spice version costs 33% more.
Another example of paying more money for less ‘stuff’: Trader Joe's Joe’s O’s cereal.The national value grocery chain charged $1.99 for 15 oz og Joe’s O’s cereal, but upped the price and dropped the amount for its Pumpkin O’s, which were priced at $2.69 for 12 oz.
In another example of retailers giving shoppers less for more, FreshDirect.com, asked $2.99 for a 6.5-oz. Pumpkin Pie Spice version of Land O'Lakes Spreadable Butter. Meanwhile, the 8-oz. Land O'Lakes Spreadable Butter With Canola Oil was sold for about 10 cents less, or $2.89. On a price-per-ounce basis, the Pumpkin pie spice option was sold at a 28 percent premium.
The same phenomenon was observed at Trader Joe's. At the national grocery chain, both the seasonal and nonseasonal Joe Joe's cookies are priced at $2.99 on the sticker. However, the seasonal Pumpkin Joe Joe’s cost 28 cents per ounce, while the regular Joe Joe’s cost 15 cents an ounce. In this case, customers pay almost double per ounce — something like the same price for half the cookies.
Coffee drinkers paid the highest premium on a #PSL at Starbucks. The coveted pumpkin spice latte (PSL) — made popular by Starbucks after its debut in fall 2003 typically carries a noticeable mark-up. The Pumpkin Spice Latte’s originator also charges the highest tax on the seasonal coffee drink.
The seattle-based coffee chain’s 16-oz. Pumpkin Spice Latte is priced at $5.25, exactly one dollar more than its 16-oz. Caffe Latte, sold for $4.25, in Manhattan’s Chelsea neighborhood. That’s an effective pumpkin spice tax rate of 23.53%.
Similarly, Pret a Manger and Panera also charge more for pumpkin lattes, but neither retailer’s mark-up is as high as Starbucks.
Check out the top ten highest-taxed pumpkin spice items below. Percentages may be rounded, and list prices are used for comparisons. Per-unit cost is based on per-ounce figures where available, or per unit/count).
How to avoid Paying the Pumpkin Spice Tax
Go to McDonald's, Dunkin’ Donuts and Whole Foods to avoid paying a premium on seasonal products.
In its analysis, MagnifyMoney observed no significant pumpkin spice premium on any of the 10 seasonal items reviewed at Whole Foods Market. If you are looking to grab a pumpkin spice latte this fall, MagnifyMoney did not observe a premium on pumpkin spice drink options at McDonald’s or Dunkin’ Donuts.
Shop after the season ends.
If it’s a matter of preference, or keeping up with the latest food fad, you may not mind paying a little extra for seasonal flavors. But, if you’re looking to save money and still partake in the fad, try shopping for those same items in a few weeks — when they are on the discount rack.
Use savings tips specific to the retailer.
You may save money on your entire basket of goods, not just pumpkin spice products, if you learn the savings hacks you can use at each retailer. The savings may soften the blow dealt by the pumpkin spice tax on products. Here’s a head start:
Trader Joe's: Sign up for the Fearless Flyer. Trader joe's’ promotes its newest products (and any deals on them!) in its Fearless Flyer, produced weekly. You’ll find new products, like the aforementioned seasonal items in the flyer, so you know what to keep an eye out for. The value store usually doesn’t have sales or offer coupons on its name-brand products, but you can use manufacturer's coupons on Trader Joe’s other products.
Starbucks: There are those who jump for joy when presented with a Starbucks gift card for their birthday because they will rush to their local Starbucks, then there are the people who sell their gift cards online. You can benefit from the actions of the latter group. Check discount gift card websites Gift Card Granny, for Starbucks gift cards sold at a discount. As of this writing, the website has Starbucks gift cards discounted as much as 16.1 percent. You can use this tactic with many other retailers, too, including several of those mentioned in this article. You can also save money by signing up for Starbucks membership rewards program or downloading the Starbucks app to see the retailer’s latest promotions. MagnifyMoney lists even more ways to save money at Starbucks here.
Target: There are so many ways the red-dot retailer’s fans can save money at the popular red-dot retailer using coupons, it’s hard to miss them. You can find Target coupons:
- The weekly ad,Target’s landing page for updates on coupons and deals
- Manufacturer's websites, like these coupons on Procter & Gamble products
- The Target app
- The Cartwheel app
- Text COUPONS to 827438 (Target)
Some locations may allow customers to stack coupons and receive additional savings. See more ways to save money when you shop at Target, here.
MagnifyMoney is a price comparison and financial education website, founded by former bankers who use their knowledge of how the system works to help you save money.