Like many things, it’s going to take a bit more cash to wow your True Love this Christmas. For 35 years, Pittsburgh-based PNC Bank has calculated and issued The PNC Christmas Price®, which calculates the total cost and changes in the individual costs for purchasing the gifts included in the classic holiday song “The 12 Days of Christmas.” it will cost 1.2 percent more in 2018 than it did in 2017, according to the economic analysis by The PNC Financial Services Group.
According to their press release, PNC calculated the 2018 price tag for The PNC Christmas Price Index at $39,094.93, an additional $450 or 1.2% over last year’s cost. That’s the bad news. The good news? The Cost of Christmas rose less than the government’s Consumer Price Index, which increased 2.5 percent through October in year-over-year measurement before seasonal adjustment.
Speaking of the CPI, the government calculates it without food and energy prices. Accordingly, PNC takes this into account and also gives a version of The PNC Christmas Price® excluding swans. In the past, Swans have been one of the most volatile price components.
Interestingly, The PNC Christmas Price® assumes that all of the 12 gifts are purchased in the traditional (retail) ways. If the gifts were purchased solely online, the costs might be higher due to packaging and shipping costs. The total cost for the internet model is more expensive, starting at a higher price point of $40,662.11 in 2017 and resulting in an internet-only cost of $41,165.95 for 2018. (That is $2,071.49 more than the cost calculated by the traditional model – all for the convenience of online shopping!) This year the increase in the online PNC Christmas Price® increased the same amount as in the traditional model.
Movement in the prices of the individual items revealed that strong employment associated with modest wage growth has impacted the model, even while tolerating market volatility.
- Six Geese A-Laying saw a big jump this year, with prices up 8.3%. However, that might have been expected since this item saw no increase at between 2014 and 2017.
- After posting the largest growth rate in 2017’s Index, the cost of Five Gold Rings fell 9% due to decreased demand and fluctuations in gold prices throughout 2018.
- Reflecting wage increases catching up to nearly full employment, Ten Lords-a-Leaping, 11 Pipers Piping, and 12 Drummers Drumming all increased between 3.0% and 3.5%.
To mirror the government’s “core” CPI, which excludes food and energy prices, PNC removes the Swans – typically the most volatile item in the index – from its total index. The core PNC Christmas Price Index was up 1.7 percent from a year ago, while the government’s core Consumer Price Index rose 2.1 percent year-over-year through October. (Apparently, since these geese are “a-laying” they are classified as agricultural products and not food!)
Of course, The PNC Christmas Price® only includes the cost of one item of each kind. If being true to the song, your True Love wanted to replicate the song by purchasing all 364 gifts; it would set them back $170,609.46, up just under $800 from last year.
PNC began estimating the cost of the gifts in the song back in 1984. This year’s price is about 95% higher than in 1984. According to The PNC Financial Services Group, their sources include “retailers, hatcheries, the Philadelphia-based PHILADANCO and the Pennsylvania Ballet Company.”
While The PNC Christmas Price® is a fun annual tradition for the company (and their customers and consumers alike), the true value of this effort is brand building. By tying their holiday message tightly with their industry, they bring a fresh perspective to their brand every year, at the very least, they contribute to our holiday cheer!