The Permission Unwind: Why Pandemic-Era Pricing Is Finally Cracking
Distinguishing structural transformation from temporary permission structures
The price never came back down.
That’s the sentence I’ve heard in a dozen conversations this fall—about fragrance, about flights, about the “little luxuries” that felt justified in 2021 and now just feel... normal. Expensive, but normal.
It’s easy to blame inflation and supply chains. But something subtler happened during the pandemic: entire categories established new pricing permission structures, and they’re proving remarkably sticky. We’re not dealing with temporary shocks anymore. We’re living with the new ceiling—and in some categories, watching it finally crack.
This is a story about how systems adapt to discontinuities, how new equilibria emerge from chaos, and why some of those equilibria turn out to be less stable than they appear. I’ve been tracking this pattern because it reveals something fundamental about how organizations and markets respond to uncertainty—and what happens when the narratives that justified new behaviors start to fray.
The Permission Structure
During the pandemic, many people spent to feel normal, seen, or soothed. In categories tied to identity and mood—fragrance, cosmetics, travel, even certain food and beverage niches—that impulse created what I call a permission structure for higher prices.
The logic was simple: “I deserve this after everything.” The scarcity was real. The emotional need was real. And once retailers saw customers accept a new price point, that acceptance became the baseline.
Consider fragrance, where the permission dynamic played out in precise detail.
In 2023, prestige fragrance sales grew 12% while mass-market grew just 4%. Luxury brands learned they could push prices aggressively. Le Labo’s Santal 33 climbed from roughly $260 for 100ml in 2019 to $340 in 2025—a 31% increase. Byredo went from $240 to $320 over the same period, up 33%. Tom Ford raised its 50ml bottles from $320 to $390, a 22% jump.
These increases far outpaced inflation, which rose 19% over the same window.
And here’s what makes this a permission story rather than a value story: customers kept buying. Not because the perfume got better, but because the category felt essential. Fragrance became part of the self-care narrative, the treat-yourself economy, the small luxury that justified its own existence.
Retailers learned the new ceiling. Many didn’t test it back down when constraints eased.
The Unwind Begins
But permission structures are fragile. They’re built on mood, not fundamentals—and mood shifts.
By the first half of 2025, something changed. Mass-market fragrance sales grew 17% while prestige grew just 6%—reversing years of prestige dominance. Consumers aren’t abandoning the category; they’re finding cheaper ways to satisfy the same need.
That’s the textbook signal that a permission structure is cracking. Not collapsing—cracking. The prices haven’t come down yet. But customers are voting with their wallets, and the vote says: “I no longer believe you’ve earned this premium.”
This is where it gets interesting from a systems perspective. We’re watching a real-time experiment in how markets recalibrate after a shock—and the recalibration isn’t smooth. It’s jerky, asymmetric, and revealing.
The Travel Parallel
Travel showed the same dynamic, though with more visible friction. Demand snapped back faster than capacity, exposing brittle systems in air traffic control and crew scheduling. In that squeeze, carriers and hotels discovered a new ceiling: customers tolerated higher fares, fees, and service downgrades because the alternative was not going.
U.S. hotel rates climbed from $131.56 in 2019 to $159 in 2024—a 21% increase—with forecasts showing further growth to $162 in 2025. European destinations saw even sharper jumps: London up 33%, Paris up 38%, Amsterdam up 22% compared to 2019.
Airfares peaked at 26.5% above baseline in February 2023, driven by the same revenge-travel dynamic. They’ve since moderated but remain elevated, up roughly 25% on key routes versus pre-pandemic.
The halo extended across the entire trip. Once you’d justified the flight, the hotel rate felt less shocking. The $40 entrée at dinner felt like part of the experience. Permission cascaded.
But just as with fragrance, travelers are now recalibrating. Budget airlines are seeing renewed interest. Shorter trips, shoulder-season bookings, and value-oriented destinations are trending up. The mood is shifting from “I deserve this” to “Is this still worth it?”
How to Spot Vibe-Driven Pricing in Your Category
If you’re reading this and wondering whether your pricing is riding permission rather than value, here are three diagnostic signals:
1. Asymmetric elasticity
Here’s the test: You raised prices 15% and lost only 3% of your customers. That looks like pricing power, right? But then you tested a 10% price decrease in a small segment, expecting to win customers back or attract new ones—and gained only 1% more volume.
That’s a tell. If customers truly valued your product at the higher price point, dropping the price should bring a proportional response. But it doesn’t. The gap between their tolerance for increases and their indifference to decreases reveals something important: they’re not buying because of value. They’re buying despite price, because they’ve internalized that “this is what it costs now.”
When customers tolerate hikes but don’t respond to cuts, you’re riding permission, not preference. They’re habituated to the new normal, not actively choosing it. And that permission can evaporate as quickly as it formed.
2. Narrative inflation
Your pricing memos cite “brand positioning” and “market dynamics” more than input costs. You can’t draw a clean line from COGS to shelf price. You’re citing what the market will bear—which means you’re floating on permission.
3. Friction tolerance
Customers are absorbing fees, delays, and service downgrades without proportionate churn. They’re complaining but not leaving. That patience is borrowed—and the loan is getting called in.
What Breaks Permission
Permission structures don’t erode gradually. They crack suddenly when one of three things happens:
Confidence shocks. Economic uncertainty, job losses, or market volatility can flip the “I deserve this” mindset to “I need to be careful.” Categories buoyed by vibes fall faster than they rose because there’s no cost basis anchoring the price.
Visible exploitation. If customers sense “because we can” pricing—especially when paired with declining service or obvious cost savings on your end—trust evaporates. The 2024-25 airline backlash over packed planes, reduced legroom, and higher fees is a case study. Customers tolerated it during the shortage; now they’re furious.
Substitutes emerge. The moment customers discover they can satisfy the same emotional need for less—mass-market fragrance dupes, budget hotels, subscription meal kits instead of dining out—the permission to charge premium prices collapses.
Lessons for Navigating Instability
What fascinates me about this pattern is how it mirrors dynamics I’ve seen in technology adoption, organizational transformation, and innovation cycles. When systems experience discontinuities, new equilibria emerge—but they’re often built on temporary conditions that participants mistake for permanent shifts.
The leaders who navigate these moments well share certain instincts:
They instrument leading indicators, not just outcomes. Track confidence, sentiment shifts, and language changes alongside traditional metrics. When the narrative starts decoupling from behavior, you’re seeing the early tremors.
They test in both directions. Most organizations only probe upward (can we charge more? can we scale faster?). The adaptive ones probe downward too—finding the true floor before external forces reveal it.
They re-earn permission continuously. If you’re holding prices high, pair the hold with clearly perceived improvements. Make the price feel re-earned, not inherited from crisis conditions.
They maintain elastic options. Good-better-best structures with honest differentiation let customers adjust within your ecosystem rather than exit entirely. The mass fragrance strategy is working precisely because it keeps customers in-category.
They communicate with integrity. Vague “market dynamics” language reads as exploitation. Specificity about costs and value builds trust that compounds over time.
They publish when they give back. When constraints resolve, retiring surcharges and announcing it builds trust asymmetrically. Customers notice who returns gains.
They plan scenarios before crises force their hand—mapping decisions across time horizons to understand what requires immediate action versus what needs longer-term positioning.
What This Reveals About Adaptation
Here’s what keeps surfacing for me: if you can’t explain why your price (or strategy, or structure, or technology choice) should persist without invoking “that’s just how things are now,” you’re probably riding borrowed stability.
The 2025 fragrance data is a warning shot across multiple domains. It’s not just about pricing—it’s about any organizational decision made during discontinuity that mistook emergency conditions for permanent shifts.
I’m seeing this pattern in:
Technology adoption decisions made during remote work that are now being unwound
Organizational structures that made sense under pandemic constraints but create friction in hybrid environments
Investment theses built on 2021-22 market conditions that are quietly being revised
Customer experience shortcuts that were forgiven during supply chain chaos but now erode trust
The question I’m sitting with: How do we build systems that can distinguish between structural shifts and mood-driven permission structures? And once we spot the difference, how do we adjust proactively rather than waiting for external shocks to force the reckoning?
An Invitation
I’m genuinely curious where you’re seeing this pattern—in your organization, your industry, your consumer behavior. Are there places where you accepted a “new normal” during the pandemic that now feels less normal and more... provisional?
What signals are you watching to distinguish durable transformation from temporary permission? And if you’re leading through one of these recalibrations, what’s working?
The comment section is open, or feel free to reach out directly. I’m collecting perspectives on this across domains, and some of the most interesting insights come from seeing the same dynamic play out in radically different contexts.
About Kate O’Neill
Known as the “Tech Humanist,” Kate O’Neill is a strategic advisor who helps organizations navigate the intersection of technological advancement and human experience at scale. She tracks patterns across consumer behavior, technology adoption, and organizational transformation, helping leaders understand how systems adapt to uncertainty while keeping human outcomes central. Kate advises Fortune 500 companies, municipal executives, and global policymakers—including as an invited attendee to UN AI Advisory Body meetings—on creating technology-enabled experiences that are both ethically sound and commercially successful. She is the author of several books including “Tech Humanist” and “A Future So Bright,” and her most recent, “What Matters Next: A Leader’s Guide to Making Human-Friendly Tech Decisions in a World That’s Moving Too Fast,” which was named to the Thinkers50 best new management booklist. Kate has been featured in WIRED, The Wall Street Journal, and on BBC. Learn more at koinsights.com.