Why AriZona Iced Tea Will Always Stay 99¢

There’s something to be said about a billionaire that refuses to increase the price of a product. For 30 years, the 99¢ AriZona Iced Tea has stayed 99¢ and won’t be jumping in price as long as the company’s founder and chairman, Don Vultaggio, has anything to say about it. 

“I’m committed to that 99-cent price – when things go against you, you tighten your belt.

“I don’t want to do what the bread guys and the gas guys and everybody else are doing. Consumers don’t need another price increase from a guy like me.”

A guy like Vultaggio is a billionaire business owner. Considering the current antiwork, antibillionaire climate, the AriZona founder and chairman is certainly more in touch than other muskier billionaires. 

How Has AriZona Kept The Price Stable?

Even as the cost of high fructose corn syrup has increased by 300% and the cost of aluminum has doubled, AriZona has maintained its 99-cent price. The value of one 1992 dollar (the year the company was founded) is worth two in 2022. 

Why wouldn’t they change it? Wouldn’t it be bad business to keep the price so low? 

Short answer: kinda. The iconic 99-cent can is still profitable, but far less so. But, to Vultaggio, customer loyalty and brand commitment are far more valuable. 

“Your company has to deal with cost increases, but your customers have to deal with cost increases too,

“And if you break their back, nobody wins.”

One big reason AriZona is able to keep its prices so low is its lack of advertising. 

“Most brands in America today believe they have to go out and have a Super Bowl commercial or do traditional advertising.

“When we first started, I didn’t have the money for that — so each can had to be like a billboard. That’s why I chose the big can. It stood tall.”

Founded in 1971 as the Arizona Beverage Company, Vultaggio found success as a beer distributor. But in 1990, he spotted people drinking Snapple even though it was cold out. Right there, he decided to get into the iced tea business. 

In 1992, the very first AriZona teas were launched. In 2020, AriZona commanded roughly 16% of the iced tea market. 

Also working in AriZona’s favor is the rigidity of prices ending in 9. A study has shown those prices, no matter the economy, hold strong. 

“It’s been like that since cavemen, the 99-cent price point was exciting then, and it’s exciting today,” 

“Something under a dollar is attractive, 

“I started out as a blue-collar guy, and budgeting your finances on a daily basis was a part of life.”

This is coming from a billionaire worth about $4 billion. In a world of Bezoses and Muskses and Zuckerbergses, be a Vultaggio. 

What Does This Say About Other Billionaires?

The five richest people in the world are:

Elon Musk – $273.2 Billion

Jeff Bezos – $180.1 Billion

Bernard Arnault & Family – $165.7 Billion

Bill Gates – $132.9 Billion

Warren Buffett – $125.5 Billion

The Vultaggio family is worth $4 Billion. Compared to those giants, it’s pitiful. But to the rest of us, it’s $4 Billion dollars. That’s enough money to never work the rest of your life, your children never have to work the rest of their lives, and their children never have to work the rest of their lives. 

The lack of greed from the Vultaggio family is a great example to set. Unfortunately, that virtue is not shared with many, many other billionaires. 

Do these other rich guys need to share their wealth? No. Should they? If we want to avoid a French-style revolution, I’d say so. 

There is nothing inherently wrong with amassing wealth and success. There is something inherently wrong with twisting systems and exploiting workers to make yourselves richer at the expense of everyone else and the rules of ethics. 

AriZona iced tea’s commitment to the 99-cent can is a testament to the Vultaggio business ideology. 

Whether that virtue will spread to other business owners remains to be seen.