Why do women pay more for some consumer goods and services?

by on August 11, 2014 at 2:36 am in Economics | Permalink

Danielle Kurtzleben considers a few hypotheses:

…women develop “relationships” with brands and are more brand-loyal than men. If that’s true, it could explain why women might pay more for a razor that’s priced too high.

And in some cases, there are legitimate differences between men’s and women’s clothing. According to Kebba Gaye, a managing partner at The Press Dry Cleaning and Laundry in Washington DC, high-priced ladies dry cleaning has to do with actual differences in the clothing. Men’s dress shirts tend to be standard in shape and material — often cotton, with two long sleeves, one button-up front, maybe a pocket or two — and one machine can press all of them.

Women’s shirts, on the other hand, are far more varied — sleeveless, rayon, cap-sleeved, buttoned, silk, pullover — and can’t all be handled the same.

“The reason a woman’s shirt is $5 versus $1.85 for men is because of the different types of shirt,” Gaye says. But he says he does make exceptions: “If men wear a polyester like Hawaiian shirt, then they’ll have to pay more, too.”

Her main explanation however is based on the demand side (is there so much market power?):

Of course, there’s an obvious answer here: society expects women to look a certain way. Put into economics terms, there’s a higher return on investment for beauty for women. Beauty products are becoming more popular among men, it’s true, but expensive skin cream is still optional. For women, all those trappings are more necessary.

The full piece is here.

1 Someone from the other side August 11, 2014 at 3:03 am

Of course, the marginal benefit from using expensive over decent quality storebrand skin cream is low to sometimes negative.

(As a guy, I’ll therefore just continue to use well-reviewed cheap sunscreen and moisturizer and invest the savings in more expensive suits and shoes 🙂

2 prior_approval August 11, 2014 at 3:29 am

Women’s perfumes cost a lot more than men’s, and non-gender Chapstick is a lot cheaper than Bobbi Brown lip balm too – http://www.bobbibrowncosmetics.com/product/12643/22753/Whats-New/Art-Stick/Lip-Balm/FH12/index.tmpl#i.17jq7xax6vcpsv

But it is the little passages that reveal the article is part of that bubble universe which reflects nothing more than itself – ‘Women play out their gender by wearing lipstick and all sorts of frilly shirts that don’t dry clean easily.’ Yep, dry cleaning – just something your typical American, man or woman, has done regularly.

Besides, wasn’t this covered by that radical left wing feminist rag Forbes a couple of years ago? Why yes, it was – http://www.forbes.com/sites/learnvest/2012/05/15/the-woman-tax-how-gendered-pricing-costs-women-almost-1400-a-year/

3 msgkings August 11, 2014 at 12:27 pm

Damn you’re dumb

4 8 August 11, 2014 at 3:54 am

Progressives sure have got the market cornered on clever sillies. They have to invent complex theories to explain extremely simple concepts because they reject the truth right at step 1.

“If women and men really were essentially different, there would be little need to prove this on a daily basis through clothing or products.” Yep, that’s it. Men and women are constantly thinking of how to prove their sex.

5 andrew' August 11, 2014 at 4:19 am

Have we ever gotten anything from listening to these people?

6 andrew' August 11, 2014 at 4:20 am

E.g. does the article have a single apples/apples?

7 andrew' August 11, 2014 at 4:23 am

I have never used a “skin cream.” I wouldn’t even know how. My wife has never used a “45 pound plate.”

8 Yancey Ward August 11, 2014 at 11:25 am

You just haven’t made her angry enough.

9 Linda August 11, 2014 at 4:25 am

I believe that it’s not only women that are more brand loyal than men. Sometimes we develop “relationships” with brands because we were raised and comfortable using said brand.

Women do in fact pay more for consumer goods and service because they prefer the quality of the item they are paying for. The article uses the example of razors which are true. Paying more for a razor means better results when shaving and one gets more uses out of it rather than the cheaper ones. The high investments in beauty and hygiene products do result in a higher return because the industry does put a lot of effort into the market to advertise their goods.

10 Dan Weber August 11, 2014 at 9:48 am

A piece of metal you drag along your skin — sometimes in very sensitive places — seems like a good place to develop brand loyalty. You could save maybe a thousand dollars over the course of your life but that feels like a false economy.

11 Dianna Perez Smith August 11, 2014 at 8:38 pm

I agree. I do not believe that it is only women that are brand loyal. Men can be just as equaly loyal depending on the value they themselves put on the product. Also, I agree that women do in fact pay more for consumer goods because they prefer the quality that they are paying for. (they value these items highly). It has a lot to do with how you were raised, what standard of living are you brought up with? What social class are you brought up in? As we grow up, also, we start exploring new different things that maybe are not so costly and you see that the quality is just slightly not as good, but you are now thinking about how you can save instead of spending unnecesarily. Most importantly, consumers need to be aware and knoweledagble on the goods and services they are consuming. Choose what is best for you, not because society or social class has said so.

12 Nikki August 11, 2014 at 5:06 am

The laundry observations belong in the second part: women are expected to look a certain way, which includes not wearing identical clothes every day. As to brand loyalty, it (a) is questionnable and (b) does nothing to explain relative expenses. So the insight is basically, “women spend more on grooming because that’s what women do.”

13 Thomas August 11, 2014 at 5:53 am

because that’s what women do… and Patriarchy, or whatever.

14 Kabal August 11, 2014 at 10:15 am

Yeah, what an eye-roller there. It’s definitely “society” oppressing women, and not an arms race between women to attain/maintain male attention/attraction.

15 Jeff August 11, 2014 at 5:45 pm

Women’s clothing is more delicate, too. Probably requires more handling/care to avoid ruining it and losing your customers.

16 EC August 12, 2014 at 2:10 pm

I think the explanation is more that women are held to higher standards of grooming than men – a man showers & puts on a suit and he’s mostly fit for polite society (these days, you don’t even have to shave!) A woman has to do a lot more & thus require more products in absolute terms; I recall a female friend saying that she had to put on at least a minimal amount of makeup to look ‘normal’ & I believe this has been proven to be true in studies – the average person’s idea of a natural, healthy woman is actually a woman wearing makeup.

I think brand preference isn’t as huge of a gender divide. Academic interest in economics may be inversely related to interest in clothes and so this is a sample problem with MR commenters, but I know plenty of men who will pay crazy premiums to buy certain brands of jeans, watches, etc. It’s just that social norms mean women consume a greater variety of goods & so their total outlay is more.

17 Karl August 11, 2014 at 5:55 am

Yep. Kid needed some dress slacks for a school uniform. I found some great deals online, but wife felt more comfortable ordering from her Lands End and paying twice as much.

18 Jan August 11, 2014 at 12:47 pm

Though school uniforms would go a long way in saving parents (and kids) money on expensive clothes nobody needs. Yeah, you can go the fancy route for uniforms, too, but there is less motivation to do so because everyone still basically looks the same.

19 Cliff August 11, 2014 at 8:40 pm

You mean they go a long way in wasting money by making you buy clothes the kid will not wear outside of school?

20 Nyongesa August 12, 2014 at 1:10 am

Uniforms have fast become a nice “little earner” for schools and they’re preferred vendor. My sons school has a uniform with specific details that can only be sourced from 1 local vendor. And that vendor charges 5-6 times what the very same clothes cost at the big box retailers. Evidently sewing on the school badge, or stencil, requires an extra $30. The school is very vigilant about spotting “non-complaint” outfits. It’s beyond obvious that the preferred vendor orders from all the same factories in Vietnam or Bangladesh as the big boxers, then adds the minimum customization and viola, instant kickback profit share. Now don’t get me wrong, I’m not a hustler hater, but i cant stand getting looked in the eye during the pocket pick.

21 Axa August 11, 2014 at 6:09 am

I would poor women until I went shopping with my wife for a new smartphone. I ended up buying an expensive one with more RAM, bigger screen, faster CPU as if I needed to run numerical models on it. The truth, I only use for emails, music and whatsapp. A year later my wife’s phone died, we went to search for one and she was clear to the shop assistant: I just need emails, whatsapp, a simple camera. Contract price as half as mine. I don’t want to make the post longer than necessary but in my gullible male consumer mind I had a discourse on why Apple phones are not good, while HTC or Samsung are great, bla, bla, bla……..stupid brand loyalty. At the end of the day, we do the same with a 50% price difference. Should I write an essay on how technology companies exploit male consumer vulnerabilities?

I understand what the author is concerned. Higher monthly expenses mean lower savings/investments. It would be great to have an updated men vs women savings rate comparison. I wouldn’t be surprised if women’s savings rate are higher. Perhaps life is cheaper for men if you chose to look at dry-cleaning and cosmetics, but that doesn’t mean than aggregate savings of men are higher than women.

22 Someone from the other side August 11, 2014 at 9:34 am

I see more women than men with iPhones (which I consider to be vastly overpriced, even more so than the Galaxy S5) so I am not so sure tech companies exploit primarily men, really.

23 Steve Sailer August 11, 2014 at 6:31 am

“Beauty products are becoming more popular among men”

I’ve been reading that exact statement for 30 or 40 years.

24 Turkey Vulture August 11, 2014 at 8:56 am

Thanks to 2-in-1 and 3-in-1 shampoo/body wash and shampoo/conditioner/body wash, I use fewer separate personal care products as a man than I did as a kid. Well, not shaving helps too.

25 Someone from the other side August 11, 2014 at 9:36 am

Those two in one or three in one products are at best mediocre at any of those jobs. IOW, good for traveling but otherwise, meh.

26 Turkey Vulture August 11, 2014 at 11:15 am

My goals are to (1) not smell, and (2) not have greasy-looking hair. They are usually good enough for that. Plus my wife’s various products manage to take up most of the available shower storage space, so one bottle of something is all I am realistically allotted.

27 Someone from the other side August 11, 2014 at 1:27 pm

Non greasy even the cheapest soap can manage. Not making my hair feel like straw takes a little more

28 ChrisA August 11, 2014 at 9:16 pm

I love the fashion now for men of shaved head and beard. 5 minutes in the shower with one kind of soap (no shampoo) and a beard trim once per week, and I look trendy! Plus plain T-shirts and jeans are now considered acceptable office wear thanks to Steve Jobs.

29 er August 11, 2014 at 6:32 am

If women pay more than men the suppliers are obviously discriminating against women. This fits perfectly with the rest of the business world where misogyny is rampant. All those ‘hypotheses’ are just meant to confuse honest feminists.
I hope congress will have a look at that. They could make a law and and a federal program to enforce that women pay exactly the same (or lower) prices as men for everything.

30 The Original D August 11, 2014 at 4:31 pm

They get free entry to clubs so it all evens out.

31 Vy Nhat Nguyen Lieu August 11, 2014 at 7:47 am

There are two reasons that may explain why women pay more and more for some consumer goods and services are psychology and economy.
Psychology: I am a male and think that every woman wants to become the most beautiful one in her man’s eyes; therefore, women pay more attention on their apperance. They buy more stuffs related to beauty, such as perfume, lotion, shoes, and shirts, so there is a variety of those goods, which leads to many different level of prices.
Economy: Women pay more for some consumer goods and services shows that the result of doing that brings them more advantages. In fact, I think that women who have beautiful apperance are easier to succeed in their jobs, so they accept to pay high price for goods or services that are good quanlity.

32 andrew' August 11, 2014 at 10:34 am

Women do tend to have to buy more different products on net. So I would suspect the brand loyalty is a time-saving heuristic to deal with added complexity. Maybe.

33 The Original D August 11, 2014 at 4:32 pm

That’s a good point. The other day a woman friend of mine let me watch her put on makeup and I was shocked at how many different products she used. Plus, she already had some makeup on, so this was just to freshen up a bit.

34 whatsthat August 11, 2014 at 10:36 am

“Why do men spend more on some consumer goods and services”: A Vox article argues that men tend to less on bras than women. An intriguing phenomenon.

35 superflat August 11, 2014 at 11:07 am

what i find weird about many female cosmetic purchases is that there’s no clear correlation with benefits. e.g., i asked many women if they’ve ever gone with just ivory soap for a month or two, to see if their skin would fall off. nope, just a crazy regimen of expensive and time consuming “care” that’s never tested for any real benefits (as compared to foregoing the lots). obviously, much of this is driven by competition/arms race with other women, because much of it focuses on things a guy would never care about (ever really cared what a woman’s nails looked like, so long as healthy?). particularly telling where women spend tons of money on gear and cosmetics, but then fail to save money on food (cough), which is likely where you’d get the most bang (cough) for your buck. at base, just seems like snake oil/marketing (welcome to capitalism!).

36 dirk August 11, 2014 at 11:21 am

“Put into economics terms, there’s a higher return on investment for beauty for women.”

According to Roissy, it’s the reverse. Men have more to gain in the looks department than women from wearing quality clothing. Most men just don’t realize it.

37 Yancey Ward August 11, 2014 at 11:29 am

I see I wasn’t the only one who thought of Roissy when reading that.

38 Average Roissy Fan August 11, 2014 at 11:54 am

Hm, so what you’re saying is Roissy’s off-the cuff musings are directly contradicted by actual objective evidence?

Must be the evidence is wrong.

39 dirk August 11, 2014 at 12:32 pm

What evidence?

40 Someone from the other side August 11, 2014 at 1:32 pm

That’s partially because the average starting point for men is so low (I know what I wear when I don’t have client contact… )

But as Yancey said my first thought was hypergamy

41 TMC August 11, 2014 at 12:01 pm

Women spend more on clothes and makeup to impress other women.
We (men) have nothing to do with it.

42 dirk August 11, 2014 at 12:39 pm

The question then is why women are more interested in impressing other women than men.

43 AndrewL August 11, 2014 at 12:58 pm

Women are not competing with men for men, they are competing with other women for men.

44 dirk August 11, 2014 at 1:30 pm

TMC was alluding to the notion that women dress for women and undress for men. Women impressing other women doesn’t impress men, does it?

45 Someone from the other side August 11, 2014 at 1:34 pm

No but as always they assume men work the same as they do with regards to status in men

46 dirk August 11, 2014 at 2:02 pm

I doubt projection explains it, because it seems more likely to be instinctive. Even among little girls, each wants to be the prettiest. Maybe it’s simply because women talk among each other more about clothes and beauty and therefore the judgment of other women is mainly what they have to go by. So, it could be that women are ultimately trying to dress to impress men, but since men are less likely to notice and comment on their shoes or whatever they have to rely on impressing other women, who play the roles of the one-eyed in a blind kingdom.

47 Someone from the other side August 11, 2014 at 2:27 pm

I actually like that explanation but in a way it’s “indirect” projection isn’t it?

48 AndrewL August 11, 2014 at 2:46 pm

Well, when men compete with other men (who is stronger, faster, smarter etc) does it impress women? well, yes it probably does. When women compete to look better than other woman, does it impress men? yes, although somewhat subconsciously. Men will perceive women as attractive relative to the women that they are standing near without commenting on the specific products that the woman is wearing.

49 Nyongesa August 12, 2014 at 1:22 am

Dirk hit’s it on the head. One thing consider is that this is an elemental part of a very long evolutionary race in mate selection and competition. Much of what we are seeing is only the tip of the iceberg. As the forces driving the underlying behavior operate at deeper level than intellectual musing. A male centric forum like this one should produce some of the worst analysis. Superflat a few comments up, also nails the male perception with his conclusion that “there is no difference” i.e. women are just stupid suckers to marketers.

50 The Other Jim August 11, 2014 at 12:04 pm

>society expects women to look a certain way.

Right. It’s not like women can dress themselves, and do so in a way that pleases them and gains them personal advantage. They are just helpless slaves to others.

And by “others” I mean men. Probably white men.

51 TMC August 11, 2014 at 12:13 pm

Most annoying part of brand loyalty is when my wife won’t buy a generic vitamin, aspirin, or such.
No difference in product, just 1/2 the price.

52 Someone from the other side August 11, 2014 at 1:37 pm

Aspirin fully agreed, vitamin only if it is indeed the same active ingredient and for many vitamins there are actually a whole bunch of not totally interchangeable options so especially for multi vitamins some of the premium stuff indeed is higher quality (disclaimer I am quite ocd about my vitamins )

53 Don Draper August 11, 2014 at 12:22 pm

What do women want?

54 Mel Gibson in that movie with Helen Hunt August 11, 2014 at 12:32 pm

A man who can literally read their mind.

55 Roger Sterling August 11, 2014 at 4:37 pm

Who cares?

56 Simon August 11, 2014 at 4:26 pm

Can I leave a thought about women and brands.

Throughout my time in working in advertising and marketing the focus for most fmcg branding was women (there were exceptions like beer and cars but even here women were seen as influential). The reason for this was, of course, that women were – indeed still are – the primary brand decision-makers. So for fifty years and more, advertisers have developed brands specifically to appeal to women. So perhaps it is no surprise that brand marketing seems to work better for women then men?

57 The Original D August 11, 2014 at 4:27 pm

Everyone knows women are hypergamous creatures who need the hand of a strong alpha. Brand loyalty is just another manifestation of eternal biotruth. /s

58 Urso August 13, 2014 at 9:58 am

The problem with good satire is that it’s indistinguishable from whatever it is that it’s supposed to be satirizing

59 M August 11, 2014 at 4:58 pm

I agree that brand based decisions are different.

I get the impression women tend to be more sensitive to how things look and feel and to fine differences in feel, flavour and texture, and make more emotional purchasing decisions (this one feels like summer, etc.), so care a lot about brands and grooming on that basis. It’s more, “The cheap brand doesn’t “feel” right”, emotionally or sensually .

Men tend to be a bit less sensitive to product differences in quality and make less emotionally and sensually sensitivity driven decisions, but have status driven and impulsive / risk taking tendencies that still mean they don’t exactly save more – they just spend money on hedonistic stuff (videogames, junk food, booze, porn) and high status stuff, preferably tools, whether high status is having the fastest car or the best watch or the best gun or the fastest phone, etc. And they get stuff marketed to them on that basis.

I’d think cosmetics and cleaning products basically orients on feeling right and “pampering” yourself, so works better for women. I don’t think it’s possible for it to appeal as much on a hedonistic basis, because it isn’t fun in a very visceral way.

That’s a very personality rooted idea though, not based on economic incentives useful.

60 Different Marie August 13, 2014 at 10:55 am

Meh, I don’t know about dry cleaning (we don’t do it – everything gets washed together in cold water and turns out just fine), but for personal products I’d say that there are so many more options for women out there that brand loyalty just simplifies shopping. I always buy the same deodorant every time because I will not spend extra time thinking about deodorant. Have you been down the shampoo aisle at the grocery store? It’s mind-boggling. As for buying more expensive products, assuming price equals value, again can just be a simplification. Yes, when you take it home and use it you should be able to determine it’s value, but most of the time people (men and women) just delude themselves that since they paid so much for something that it must be better.

As for our house, husband joined dollar shave club and ordered two handles – one for him, one for me. Works great. We have one shampoo/condition set that I buy and we both use. I will not use his shaving cream because, dude, that stuff smells way too strong. I will say some types of expensive make-up is worth the markup. It all goes on the same and looks nice to begin with, but some more expensive brands will still look fresh when you come home from work. Unfortunately figuring that out takes some experimenting.

61 Poli Akter August 25, 2014 at 5:05 am

There are legitimate differences between men’s and women’s clothing. According to Kebba Gaye, a managing partner at The Press Dry Cleaning and Laundry in Washington DC, high-priced ladies dry cleaning has to do with actual differences in the clothing. Men’s dress shirts tend to be standard in shape and material. They are providing consumer goods and services very nicely and I am pleased their service. Thanks a lot for your great service.

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