A hidden tariff tax, dubbed "sneakflation," is quietly raising prices on everyday goods and squeezing business profits. Faced with this pressure, many companies make the mistake of implementing blunt, across-the-board price hikes that can damage sales volume and customer relationships. This post details a smarter, surgical approach, using data-driven strategies like price elasticity analysis and scenario modeling to manage rising costs. Learn how to walk the pricing tightrope to protect your margins without alienating your customer base.

Spotify recently implemented its second major round of price hikes in under two years, significantly increasing rates in Benelux countries and signaling further rises across Europe and Latin America.

This aggressive pricing strategy follows Spotify's first full-year operating profit in 2024, indicating a strategic shift from subscriber growth to boosting ARPU and profitability. The company is employing a "ladder pricing" approach, testing price elasticity in smaller markets before wider rollouts to manage churn and investor expectations. However, this creates widening price gaps with competitors, forcing Spotify to increasingly rely on its unique value proposition and bundled offerings like the planned "Music Pro" add-on.