PepsiCo has announced a significant reduction in the prices of several of its popular snack items in the United States, a move prompted by backlash against previous price increases and changing consumer behaviours linked to appetite-suppressing medications. This initiative, which includes price cuts for products such as Doritos, Lays (known as Walkers in the UK), and Cheetos, aims to alleviate the financial strain felt by consumers amid rising living costs.
Price Cuts Ahead of Super Bowl
Effective this week, a nearly 15% decrease in the price of Doritos will be among the most noticeable adjustments for consumers. The decision aligns with PepsiCo’s strategy to address customer feedback, as articulated by the company, which stated it was “listening closely to customers” who are increasingly affected by inflation. This price adjustment comes just ahead of the Super Bowl on February 8, a critical period for snack sales, as the event traditionally sees a spike in demand for snack foods.
Despite these reductions, PepsiCo has clarified that while it is lowering suggested retail prices, actual prices on store shelves are determined by retailers. The company assured consumers that the changes would not affect the size, ingredients, or taste of the products. Chief Executive Ramon Laguarta noted that the company’s strategy is now heavily focusing on portion control, a response to the growing popularity of GLP-1 weight loss medications like Wegovy and Ozempic, which have led consumers to purchase and consume less food.
Strategic Shift Towards Health-Conscious Products
In addition to the price cuts, PepsiCo is pivoting toward health-oriented offerings. The company plans to launch Doritos Protein later this year, reflecting a broader trend towards healthier snacking options. Currently, over 70% of its food products in the US are single-serve, indicating a shift in consumer demand towards portioned products. These changes come as many users of GLP-1 medications have reported a significant decrease in their food expenditure, further influencing PepsiCo’s market strategy.
Rachel Ferdinando, PepsiCo’s US food chief, highlighted the importance of these price reductions, stating, “We’ve spent the past year listening closely to consumers, and they’ve told us they’re feeling the strain. Lowering the suggested retail price reflects our commitment to help reduce the pressure where we can.”
Financial Context and Market Performance
PepsiCo’s recent price adjustments arrive amidst a complex economic landscape. The company reported a revenue of $29.34 billion (£21.14 billion) for the quarter ending 27 December, although its shares had experienced a decline of approximately 5% in 2025 and have lagged behind rival Coca-Cola in market performance over the past five years. The company is optimistic about the future, anticipating 2026 to be a “record year of productivity savings.”
Despite a decline in US inflation rates, food producers, including PepsiCo, continue to grapple with escalating costs stemming from tariffs on materials such as aluminium, alongside rising labour expenses and the impact of extreme weather events on supply chains. Many consumers have voiced their frustration with “shrinkflation,” where product sizes decrease while prices remain unchanged—an issue that has affected several PepsiCo items internationally.
Why it Matters
PepsiCo’s decision to reduce snack prices underscores the increasing pressure food companies face from both consumers and market trends. As health-focused products gain traction alongside evolving consumer preferences, the company’s strategy reflects a broader attempt to balance profitability with affordability. The recent price cuts may not only bolster sales during pivotal events like the Super Bowl but could also signal a shift in the industry towards more consumer-centric pricing strategies, a necessity in an era marked by financial uncertainty and changing dietary habits.
