The 99 Cent Beverage: AriZona Iced Tea


Ayan Rasulova

99 cents 100 percent of the time: AriZona Iced Tea has, for the last thirty years, vowed to keep their iconic 23-ounce iced tea beverages at a consistently convenient price even in the midst of record-breaking inflation. Groceries, gas, and other similar beverage companies have been steadily increasing their prices to adjust during periods of economic turmoil, but AriZona insists on remaining an outlier. How are they able to keep their cans so cheap without losing money?

AriZona’s constant price has cost the company some profit during recent years, but 70-year-old founder and chairman Don Vultaggio seems fully committed to his pricing, claiming he doesn’t “want to do what the bread guys and the gas guys and everybody else [is] doing.” In the realm of nonalcoholic beverages, AriZona is one of the few top independent sellers (along with big brands like Pepsi and Coca-Cola), which allows them to successfully take on such a business model without it posing as too much of a risk.

While the company certainly doesn’t make as much as they could be making, Vultaggio’s plan is still strategic from a business point of view. By maintaining 99-cent cans, AriZona is able to sell more of their product, ensuring higher sales volume than their competitors (who average their drinks at around $2) at the cost of less expensive drinks. Even the specific price value the drink is listed for- 99 cents -is clever. Having the cost of a drink be under a dollar (even if it’s just by one cent) stands out to consumers, with Vultaggio himself claiming, “Something under a dollar is attractive. It’s been like that since cavemen, the 99-cent price point was exciting then, and it’s exciting today.”

Not only does AriZona Iced Tea not rely on higher prices, but they also don’t spend money on grand advertisements like other companies do. Vultaggio would take word-of-mouth promotions over Super Bowl ads any day, making his approach uniquely authentic. According to him, “the way [AriZona] succeeds is by doing things differently.”