A long time ago, I wrote a story on the marketing of breakfast cereals. To give you an idea on how long ago this was, Chuck Schumer was still a House representative; Schumer has been the senior U.S. senator from New York since 1999.
Then-Rep. Schumer was complaining about the high cost of brand-name breakfast cereals, and how advertising was driving up the cost of breakfast cereals. And you thought our politicians didn't care about the consumer.
Schumer still brags about this on his Web site, and I quote:
Issued a 1995 report entitled "Consumer in a Box" which explored the 90% increase in breakfast cereal prices since 1983 and demanded that the Justice Department investigate breakfast cereal antitrust violations.
I noted in my 1995 consumer marketing column that Kellogg's had started a campaign pointing out that a serving of cereal with milk costs about 30¢. So even with two bowls of cereal with milk, you are only out 60¢. Couldn't even get a small French fries back then for 60¢ (except for Hot 'n' Now, a different story for a different time).
Michael Pollan used the same gimmick to point out how $8 for a carton of a dozen brown eggs wasn't that big of a deal, since two eggs would cost $1.50.
Eight dollars for a dozen eggs sounds outrageous, but when you think that you can make a delicious meal from two eggs, that's $1.50. It's really not that much when we think of how we waste money in our lives.
Actually, two eggs at that rate cost $1.33. And if you pay $5 for a dozen of farm fresh eggs, as I do, two eggs comes out to 83¢.
That is cheaper than a protein plus biscuit from a fast food drive-thru. And with the brown eggs, you get more omega-3s, a long-term benefit.
Breaking down the cost of food into servings is a great way to get the true value impact on your food budget.
Take spaghetti: you could buy a pound of dried white-flour spaghetti for a pretty cheap price, say $1.09. And you could buy 12 oz. of whole wheat spaghetti for $1.99.
If you analyze the cost per 2 oz. serving, the white flour spaghetti comes out to 14¢ and the whole wheat spaghetti comes out to 33¢.
The difference is dramatic: the whole wheat spaghetti is more than twice as much per serving. However, the whole wheat spaghetti has more fiber and keeps you more full longer. And you can eat less of it.
If you factor in a 4 oz. serving of regular spaghetti vs. a 2 oz. serving of whole wheat spaghetti, the difference is 5¢ instead of 19¢, and you have eaten fewer carbohydrates with the whole wheat spaghetti.
Breaking down the cost per serving helps justify buying better-made foods because the perspective is clearer.
There isn't anything wrong with buying a carton of eggs for $1.19 per dozen, and surviving on that. And admittedly, a two-egg meal costing 20¢ instead of 83¢ does add up financially. But 63¢ may not be enough to make that kind of a judgment, and you can judge that the upfront cost difference isn't worthwhile.
Enough consumers will always pick on price, but they need to figure on cost per serving, as well as long-term costs in determining which food is the "cheapest."