Unveiling the Pink Tax: Navigating Economic Justifications, Marketing Strategies, and Health Implications of Gender-Based Price Discrimination
The pink tax refers to the practice of charging higher sales tax and price markups for products and services sold to women while men are paid less for a similar product or service. It is a type of gender-based price discrimination that is marketed special toward women and does not denote a literal tax. The underlying logic of economic justification and marketing strategy was used as an excuse for price discrimination and gender-based pricing. Some tried to justify the pink tax by arguing that female products cost more to produce but some question whether it is necessary for the pink tax to exist since it has applied to a wide range of products, including feminine personal care products, women’s wardrobe, and services including female healthcare and beauty industry.
People who tried to justify the pink tax argue that it is necessary due to differences in the cost of producing goods or in the process of providing services. Some view it as unfair and unnecessary because women are expected to pay more for personal care products to meet social expectations while female consumers would be seen as less price-sensitive. Even though economic reasons and marketing tactics including cost variance, market segmentation, demand pricing, and brand position strategy are often cited as reasons for price discrimination. However, these reasons are not universally accepted and still face various criticisms. Still, companies may utilize these to offer explanations to rationalize their pricing strategies. The paper aims to deconstruct the pink tax by exploring its justifications, impact on personal care products and marketing strategies, insights from government studies, challenges to its narrative, and the broader implications for women’s well-being.
Issue in Personal Products and Marketing Strategy
The price disparities in personal care products are a significant field in rationalizing gender-based price discrimination because the products sold are categorized by gender in the market. In psychology today a publisher is making this argument that pink tax is unethical when sellers only provide superficial changes in product packaging color or change in scent (Dholakia). This could create a hidden barrier when females try to purchase the product because of the product label. In this case, even women could purchase the cheaper men version of the product, but the psychological hint could lead them to purchase the marketed female product, and this phenomenon is called gender-based versioning. In this case it could be unethical according to the publisher when companies trying to take advantage of female consumer by to sell the same product and the only difference is in packaging.
As a result, firms justify the sales of products to women consumers under the gender- based visioning strategy by utilizing excuses including the extra cost in production and marketing cost, and gender-based tariffs. Besides, this provide chances for firm take advantage of women being less price sensitive while shrinking the product quantities. According to Guittar and Gonzalez, female consumer needs to pay more due to the extra cost in research and development that contribute to the product production session. Even the female’s product is an identical product with only a difference in packaging has no major cost difference in ingredients with the male version of product.
Also, the raw material in producing women’s products is less due to the “shrink it and pink it” strategy, a gender bias in designing products for women. A same deodorant stick that sold to men contains 2.7 oz but the one sold to women is 0.1 oz less. The prominent claim on some women’s products cost more in design such as female razors are more expensive because of the moisturizing strip however with the comparison made by Blasio and Menin they find out that men’s razor also has the same feature. The product appears to be similar in shampoo, lotion, and razor however women pay more 42% of the time on these products than men according to their study (Guittar, Pg 5).
According to Professor Anna Tuchman’s study. Financially, A family can save up to 10% if they purchase an alternative gender-targeted product with distinct formulations (Tuckman). However, consumers are less inclined to shop this way. Even though there are no disadvantages to purchasing the men’s version of the product, women are less intendedly to do so. Because of this woman are categorized as less sensitive to price changes and are willing to pay more and buy a wider range of personal care products. The social expectation of women is a significant factor here. Besides, marketing campaigns of products and society’s demands on a certain physical standard of women are causing women to spend more on personal care products which is not only because of the pink tax. Tuchman’s study illustrates that they found a common ingredient that was added to female personal care products and increased its price moisturizer after they examined the ingredients of every product. It is deeply rooted in women’s shopping habits due to the marketing strategy (Tuckman). As a result, some publisher believes it is unfair and unethical to price premiums on products especially when it is different by gender (Dholakia).
Insights from Government Studies
According to a study by the United States Government Accountability Office in 2018, they analyzed 10 products in Nielsen Company’s data and found out 5 of the products are priced higher for women and only 2 products are priced higher for men. This could create a financial burden in a hidden way since personal care products are fast-moving consumer goods. It is even more harmful to less economically advantaged individuals (GAO). Another well-known study that people utilize to question the pink tax is a study by The New York City Department of Consumers Affairs (DCA). In its 2015 study, after examining 90 brands and 800 items, they concluded that female consumer pays 7 per cost more on average for products that are marketed toward women based on examining the firms’ way of branding, marketing, ingredients, appearance, textile, and production (Pant).
Challenging the Pink Tax Narrative
There are defenders of the pink tax explaining why women’s products should be marked higher by citing research conducted by Anna Tuchman a professor in marketing at Kellogg School of Management at Northeastern University, Sarah Moshary in UC Berkely, and Natasha Bhatia from Cornerstone Research. Their article is also well cited not only because the data sets are wider, by collected three years of data from 40000 stores in the U.S. and compared the ingredients database of each product. Moreover, this study is beyond the federal pink tax legislation that only targeted “substantially similar” products. The study shows the prices of comparable products are different due to the ingredients that are added to each type of product. They examined the male and female products as two different categories due to their composed ingredients. They argued that only a small proportion of identical products that charged differently by distinct packaging. The conclusion of their research is there are only subtle variations between the price of men’s and women’s products, and these discrepancies could even out across various products (Tuckman).
Anna Tuchman’s study is still controversial because nowadays, it is hard to find identical product versions marketed to men but still scholars can compare the prices of similar products now because regulations have been banning gender price disparities and it is hard to impose a pink tax as long as manufacturers market the products as they are genuinely different from the ingredient. Blasi and Menin’s study was published in 2015 but people can still witness the gender pricing issue in Guittar and Gonzalez’s study in 2022 that 3 of the products including lotions, deodorants, and shaving cream are priced significantly difference in pricing per ounce (Guittar, Pg 10). It symbolizes a lack of improvement on the issue of pink tax on the market.
Beyond Consumer Goods: Tariffs and Pink Tax. Another more powerful and legal reason that firms utilize to defend for pink tax is less controversial is that some female products like clothing are the costliest to manufacture and especially tariffs make it a possible explanation for the pink tax. According to the Joint Economic Committee’s research on how the pink tax hurts women’s buying power states that clothes imported by the women category are taxed at 15.1% compared with men taxed at 11.9% in 2015 (JEC). Such difference in economic valuation does not benefit women because the imported fee would transfer to female consumers and contribute to the markup of product prices. This issue can be addressed when Congress passes a new regulation banning the “tariff differentials on products that are gender-classified, but otherwise identical.” on imported tax (Cole). It indicates how the included tax could impact the price of gendered items, damaging the rights of female consumers when the price of the product is artificially inflated.
The Pink Tax in Healthcare:
Nevertheless, women not only pay more for the product but also face extra charges for the services. The report from Deloitte reveals that the economic burden of the pink tax could negatively affect females’ physical and psychological health. Women pay about $15.4 billion more out-of-pocket health care charges compared with a man who hold similar insurance with the same premium but with a less actuarial value of their coverage. For example, the 10% more health expenditure like breast cancer screening and maternity fees are 20% higher. This circumstance could exacerbate the financial stress caused by the pink tax and also intensify the gender-based financial disparities. Personal financial performance is closely linked to physical health and psychological well-being. The disproportionate cost that women need to pay is a significant burden not only because women are more on the financial edge than men, but also because the economic pressure could act as a pessimistic factor in impacting the choices women make when facing treatment care. According to the US General Accounting Office, in 2022 women made $0.82 for every dollar a man made, black women $0.63, and Latina women only $0.58 for every dollar White man made (Jen). Women of color, younger women, unmarried women, and those with unfavorable incomes may experience greater financial burdens and psychological stress when facing these extra costs. When women already earn less than men today, the disadvantage of the pink tax intensifies the income disparity between men and women.
Conclusion:
In conclusion, the deconstruction of the pink tax reveals a series of economic justifications, marketing strategies toward women, and legislative responses that contribute to gender-based price discrimination. From personal care products to healthcare services women face extra financial burdens even some argue that disparities are minimal. There is still a need for awareness both on regulation and consumer awareness since inequality could impact women’s psychological and physical wellbeing. As gender-based pricing disparities persist, contributing to broader gender inequalities. People should advocate a marketplace that is fair and equal where women can make purchases free from social restrictions and unjust pricing while also enjoy better healthcare and psychological health.
Reference:
Cole, Gail. “What Is the Pink Tax and Will It Have an Impact in 2023 — Avalara.” Avalara, Inc., 5 May 2023, www.avalara.com/blog/en/north-america/2023/05/what-is-the-pink-tax-and-will-it- have-an-impact-in 2023.html#:~:text=More%20specifically%2C%20the%20pink%20tax, designed%20for%20men%20or%20boys. Accessed 29 Jan. 2024.
Christensen, Jen. “How a ‘pink Tax’ on Women Can Hurt Their Health, Especially for Breast Cancer Patients.” CNN, Cable News Network, 3 Oct. 2023, www.cnn.com/2023/10/02/health/health-pink-tax-for-women-hurts-their-health/index.html.
Dholakia, Utpal. “Is the Pink Tax Ethical?” Psychology Today, Sussex Publishers, 11 Mar. 2019, www.psychologytoday.com/us/blog/the-science-behind-behavior/201903/is-the-pink-tax-ethical. Accessed 29 Jan. 2024.
Guittar, Stephanie Gonzalez, et al. “Beyond the Pink Tax: Gender-Based Pricing and Differentiation of Personal Care Products.” Gender Issues, vol. 39, no. 1, 2022, pp. 1–23, https://doi.org/10.1007/s12147-021-09280-9.
Pant, Svasti. “Https://Ijpsl.in/Wp-Content/Uploads/2021/03/UnPinking-Discrimination- Exploring-the-Pink-Tax-and-Its-Implications_Svasti-Pant.Pdf.” International Journal of Policy Sciences and Law (IJPSL), International Journal of Policy Sciences and Law Volume 1, Issue 3, Mar. 2021, ijpsl.in/wp-content/uploads/2021/03/UnPinking-Discrimination-Exploring-the-Pink- Tax-and-its-Imlications_Svasti-Pant.pdf.
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“The Pink Tax How Gender-Based Pricing Hurts Women’s Buying Power.” Joint Economic Committe, United States Congress, Dec. 2016, www.jec.senate.gov/public/_cache/files/8a42df04-8b6d-4949-b20b-6f40a326db9e/the-pink-tax-- -how-gender-based-pricing-hurts-women-s-buying-power.pdf.
Tuchman , Anna. “Why Are Products Marketed to Women Sometimes More Expensive?” Kellogg Insight, 14 Aug. 2023, insight.kellogg.northwestern.edu/article/products-marketed-to- women. Accessed 29 Jan. 2024.
United States Government Accountability Office. (2018). Report to congressional requesters. Consumer protection: Gender-related price differences for goods and services. Retrieved November 13, 2020 from https://www.gao.gov/assets/700/693841.pdf
