Analysis of the Marketing Issues and Implications Behind the Pink

Tax

Ruixuan Lin

College of Arts, Humanities and Social Sciences, The University of Edinburgh, Edinburgh, U.K.

Keywords: Marketing, Economics, Gender Equality.

Abstract: The term "pink tax" describes the widespread occurrence of gender-based pricing disparities in the

contemporary consumer market, where women are often required to pay more for similar or identical goods

and services. This problem worsens gender inequality and affects the economic rights of female consumers.

This paper examines the marketing strategies behind the pink tax, including gender-based pricing, market

segmentation, and target marketing, and explores its impact on consumer behaviour and social equity. The

findings indicate that the existence of the pink tax stems from firms' use of gender differences in product

pricing, which is further reinforced by consumers' social identity mentality and gender stereotypes. In addition,

the lack of market regulation and consumer rights awareness contributes to the persistence of the pink tax

across several industries. To address this issue, this paper proposes policy and regulatory improvements,

corporate pricing strategy adjustments, and the enhancement of consumer rights awareness to promote market

fairness and gender equality.

1 INTRODUCTION

In today's society, gender equality has become a

global concern. However, inequalities against women

persist in many fields, one of which is the "pink tax".

The pink tax refers to the fact that women often pay

higher prices for goods and services that are similar

or identical to those marketed to men. This

phenomenon is widespread in daily life; for example,

women's razors, shampoos, and clothing are often

priced higher than their male counterparts. This issue

has not only triggered consumer scepticism but has

also led to extensive discussions in academia and the

broader community.

With the continuous development of the

consumer market, enterprises often adopt

differentiated pricing strategies to meet the needs of

various consumer groups and maximise their profits.

However, in some cases, such strategies have evolved

into unfair pricing practices targeting female

consumers, i.e., the pink tax. In recent years, there has

been growing interest in the pink tax phenomenon,

with actions being taken to challenge unjustified

gender-based pricing differentials. Additionally,

frequent media coverage of this issue has further

drawn widespread public attention.

The study of the pink tax phenomenon holds both

theoretical and practical significance. From a

theoretical perspective, it provides insights into the

marketing logic behind gender-based pricing

strategies and contributes to research in the fields of

marketing and consumer behaviour. From a practical

standpoint, it helps raise consumer awareness of their

rights, promotes corporate social responsibility, and

fosters social fairness and gender equality. This paper

primarily analyses the marketing strategies behind

this phenomenon, explores its impact on consumers

and society, and proposes corresponding

recommendations for improvement.

2 THE MARKETING

STRATEGIES BEHIND THE

PINK TAX

2.1 Application of Gender-Based

Pricing Strategy

Gender-based pricing strategy is one of the core

mechanisms of the pink tax phenomenon, which

refers to the fact that companies develop different

pricing strategies based on the gender of the

consumer to obtain higher profits (Guittar et al.,

668

Lin, R.

Analysis of the Marketing Issues and Implications Behind the Pink Tax.

DOI: 10.5220/0014150400004942

Paper published under CC license (CC BY-NC-ND 4.0)

In Proceedings of the 2nd Inter national Conference on Applied Psychology and Mar keting Management (APMM 2025), pages 668-672

ISBN: 978-989-758-791-7

2022). A 2015 study by the New York State

Department of Consumer Affairs (NYDCA) showed

that products targeted at women are priced, on

average, 7% higher than similar products for men.

This percentage may vary by type of product, such as

7% for toys, 8% for adult clothing, and 13% for

personal care products (Nguyen, 2021). Guittar et al.

studied more than 3,000 personal care products and

found that while the pink tax does not apply to all

product categories, women pay more when

purchasing the majority of personal care products,

such as deodorants and moisturisers (Guittar et al.,

2022). In particular, the price difference for hair care

products is as high as 48 per cent. This is because

women need to purchase shampoo and conditioner

separately, whereas, for men, shampoo and

conditioner are usually combined into one product

(Nguyen, 2021). Women also usually pay more than

men when using services such as hairdressing, car-

buying advice, laundry and ironing. For example,

women pay, on average, 25% more than men for the

same haircut at a hairdresser (Nguyen, 2021).

In addition, Habbal notes that the pink tax may

also be influenced by government tax policies, such

as higher import tariffs imposed on some female

goods, especially clothing and footwear (Habbal et

al., 2020). Betz et al. found that by comparing tariffs

on nearly 200,000 pairs of men's and women's goods

in 167 countries or territories, imported women's

goods were taxed at an average rate of 0.7 per cent

higher and that this difference was exacerbated by

transactions between wholesalers and retailers (Betz

et al., 2021).

2.2 Factors Contributing to the

Existence of the Pink Tax

2.2.1 Market Segmentation and Target

Marketing

Market segmentation is one of the most important

factors in the formation of pink taxes ( Barnes &

Brounstein, 2022). Companies segment the market

into small groups with similar needs, perceptions and

income levels and develop targeted marketing

strategies to increase brand loyalty and profitability

(Nguyen, 2021). There are many types of market

segmentation, among which segmentation by gender

is very common. 85% of the world's purchases are

dominated by women, so most companies develop

marketing strategies that target women (Chua et al.,

2022). A study by Chua et al. found that companies

portray similar products as gender-specific and

exclusive by using colours, packaging, and

advertising language to create price differences. For

example, women's razors are usually in pink or pastel

shades, while men's are in blue or black. Even though

both have the same functionality, there is a significant

price difference (Chua et al., 2022). Many young

women lack awareness of the pink tax phenomenon

and are therefore more likely to be influenced by

brand promotions, thus accepting higher-priced

female-specific products (Chua et al., 2022).

2.2.2 Consumer Behaviour and

Psychological Analysis

From a psychological point of view, social identity

and gender stereotypes have a significant impact on

female consumers' purchasing decisions. Society

expects different things from men and women,

resulting in men and women having different needs in

life. Research has shown that women tend to buy

products that reflect the beauty of their appearance.

When it comes to clothing, men tend to view clothing

as a basic need, while women view clothing as a

useful tool to show personal value or provide a sense

of social belonging (Nguyen, 2021).

In addition, gender differences cause men and

women to respond differently to factors that influence

consumer behaviour. As an example, for an

advertising message, women usually pay more

attention to the details while men pay more attention

to the whole. As a result, females are usually more

influenced than males when exposed to a brand's

message, such as advertising models, slogans and

images (Nguyen, 2021).

3 SYSTEMIC PROBLEMS AND

CONSEQUENCES OF THE

PINK TAX

3.1 Obstacles Preventing Consumers

from Resisting the Pink Tax

3.1.1 Inadequate Consumer Protection

Because the pink tax is invisible, most women are

unaware that they are being discriminated against,

especially those who are not capable of picking out

goods or who do not have access to the internet

(Nguyen, 2021). Although the issue of the pink tax

has gradually received widespread social attention in

recent years, consumers still lack effective means of

defending their rights in the face of unfair pricing.

Nguyen points out that many female consumers lack

Analysis of the Marketing Issues and Implications Behind the Pink Tax

669

awareness of the existence of the pink tax, and even

if they are aware of the problem, they are often unable

to take effective action due to legal loopholes

(Nguyen, 2021).

Moshary et al. analysed retail market data and

found that it is often difficult for female consumers to

access price transparency. Many companies use

ambiguous pricing strategies, making it difficult for

women to identify the existence of gender price

discrimination when purchasing products (Moshary

et al., 2023). Due to the competitive market

mechanism, the overall market maintains this

unfairness even when certain brands try to remove the

pink tax (Moshary et al., 2023).

In addition, Brand and Gross showed that online

shopping recommendation systems also exacerbate

the effects of the pink tax. They found that when

female consumers were shopping for clothing, the

system typically recommended more expensive

products, while male consumers were more likely to

receive less expensive recommendations (Brand &

Gross, 2020). This, again, makes it difficult for female

consumers to access transparent price information and

leads to a lack of awareness of their rights.

3.1.2 Lack of Corporate Social

Responsibility

Firms tend to make more profits through gendered

marketing strategies rather than being proactive in

their social responsibility. Barnes and Brounstein

noted that although many brands emphasise gender

equality in their promotions, gender pricing

discrimination still exists in their actual pricing

strategies, especially in the beauty, care and apparel

industries ( Barnes & Brounstein, 2022). Some

companies and brands explain that women's clothing

is more expensive than men's because of different

production costs. However, retail prices are not

determined by the manufacturer but by the retailer

and retailers, as traders will always set a price that

allows them to make a profit (Nguyen, 2021).

A study by Chua et al. found that some firms take

advantage of consumers' perceptions of gender labels

by shaping gendered products through packaging and

advertisements so that consumers unknowingly

accept the pink tax (Chua et al., 2022). In addition,

some firms rationalise price differences by adding

extra features (e.g. fragrance, packaging design), but

in reality, the cost of these extra features is much

lower than the premium (Chua et al., 2022). In most

cases, the only difference between gendered products

is the colour rather than a substantial quality

improvement (Chua et al., 2022).

3.2 Gender Discrimination and Social

Equity

The pink tax is not just a pricing strategy in a market

economy; it also reflects deep-rooted gender

discrimination. According to a study conducted in

California, USA, in 1994, the pink tax caused women

to pay approximately $2,191 more per year than men

(Nguyen, 2021). Habbal points out that the existence

of the pink tax causes women to face higher financial

burdens when purchasing daily necessities, and this

phenomenon is especially prominent among low-

income female groups. As women's average wages

are already lower than men's, the pink tax further

exacerbates gender income inequality (Habbal et al.,

2020). According to the OECD 2020 report, the

gender income gap exists in most countries in the

world (Nguyen, 2021). Some have argued that

women can avoid suffering the effects of the pink tax

by purchasing men's products. However, it can place

women in gender-challenging situations and force

women to adjust their needs and preferences to fit into

the male world (Nguyen, 2021).

Pervasive gender discrimination leads to the

underrepresentation of women in political positions,

which in turn results in policy outcomes that

disadvantage women, such as increased import tariffs

on women's goods (Betz et al., 2021). Studies have

shown that in democratic countries, the lack of equal

representation for women contributes to higher

annual tax penalties imposed on female consumers,

with an estimated cost of $324 million per country

(Betz et al., 2021). This imbalance in political

decision-making further aggravates economic

inequality between genders.

4 RECOMMENDATIONS FOR

ADDRESSING THE PINK TAX

4.1 Improvement of Policies and

Regulations

Governments should increase efforts to regulate the

pink tax phenomenon and introduce stricter laws and

regulations to ensure fair competition in the

marketplace. Hatch suggests that governments should

require companies to be transparent in their pricing

and list the cost components so that consumers can

identify whether there is an unjustified gender-based

pricing disparity (Hatch, 2021).

The California Gender Tax Repeal Act of 1996

prohibits gender-based pricing of consumer services.

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In 2022, California expanded its statute to include

commodity pricing under gender-based pricing as

well (Moshary et al., 2023). New York State's

FY2021 budget bill also includes a provision

prohibiting the pink tax (Moshary et al., 2023). Other

governments can learn from their approach by

legislating against gender-specific pricing

discrimination and increasing scrutiny and

enforcement of retailers (Hatch, 2021). However, the

existing laws have limitations in scope and

effectiveness. For example, New York State law

allows retailers to charge more for goods if they can

justify the price difference based on factors such as

cost, labour, and materials (Guittar et al., 2022). As a

result, manufacturers and retailers can exploit this

loophole by making minor changes to the product to

justify a price increase (Guittar et al., 2022). The

development and improvement of relevant

regulations require a long and gradual process.

In addition, the government can enhance market

monitoring mechanisms, establish consumer

reporting channels, and impose financial penalties on

non-compliant enterprises to increase the cost of non-

compliance and encourage businesses to proactively

adjust their pricing strategies. The government can

also incentivise enterprises to provide gender-neutral

products to promote fair market competition.

4.2 Adjustment of Enterprises' Pricing

Strategies

Enterprises should abandon gender-based pricing

strategies and adopt more equitable and transparent

pricing methods. They can adjust their production and

marketing strategies to minimise unnecessary

packaging and excessive marketing costs, ensuring

that products are offered at uniform prices. By

promoting gender-neutral products, companies can

also help reduce discrimination resulting from

gender-based branding.

Additionally, companies can build consumer trust

through transparent pricing strategies. For example,

listing the cost breakdown on product packaging or

promotional materials would allow consumers to

assess the value for money of their purchases more

rationally.

4.3 Enhancing Consumers' Awareness

of Their Rights

Consumers should increase their awareness of their

rights, deepen their understanding of the pink tax, and

take action against unfair pricing. Social media and

consumer advocacy organisations can play a greater

role in raising public awareness of the pink tax and

pressuring companies to revise their pricing

strategies.

Furthermore, consumers can utilise legitimate

channels to advocate for fairer pricing practices and

encourage companies to improve their pricing

models. Social organisations and the media can

intensify public awareness campaigns to expose

instances of the pink tax and encourage consumer

vigilance in monitoring market prices.

5 CONCLUSION

This paper discusses the "pink tax" phenomenon and

the marketing strategies behind it, analysing its

impact on consumers and society. The study shows

that through gender-based pricing strategies, market

segmentation, and target marketing, enterprises have

caused female consumers to bear a higher financial

burden when purchasing goods and services. At the

same time, the pink tax not only exacerbates

economic gender inequality but also exposes the

inadequacies of market regulation and the weakness

of consumer rights awareness.

To address this problem, this paper proposes three

suggestions for improvement: First, the government

should improve relevant laws and regulations to

strengthen the oversight of the pink tax phenomenon

and ensure fair competition in the market. Second,

enterprises should adjust their pricing strategies,

abandon gender-discriminatory pricing models, and

promote the development of gender-neutral products.

Lastly, consumers should enhance their awareness of

their rights and resist unfair gender-based pricing

through collective action, social media, and legal

channels.

Overall, the pink tax phenomenon is not only a

market economy issue but also an important

challenge related to social equity and gender equality.

Only through the joint efforts of the government,

enterprises, and consumers can gender-based pricing

discrimination be effectively reduced, fostering a

fairer and more reasonable market environment.

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