If you visit the supermarket and notice that the snack bags are filled with air, the coffee cans that used to weigh first 16 ounces, then 13, and now 8, and that the tuna cans have gone from a hefty 7.5 to a petite 5 ounces, then you’re experiencing “Shrinkflation.” This is the latest strategy for hoodwinking consumers and hoping that they won’t notice that producers and marketers are wringing more money out of them.
Everything is being downsized except the prices. Social media is full of angry comments by those same consumers that are not being deceived by the practice. This includes President Joe Biden, who on Super Bowl Sunday released a social media spot in which he lamented the practice.
“When buying snacks for the game you might have noticed one thing: Sports drinks bottles are smaller, bag of chips has fewer chips, but they are still charging us just as much,” Biden says in the spot, shot in the White House Family Theater. “As an ice cream lover, what makes me most angry is ice cream cartons have actually just shrunk in size, but not in price.”
However, contrary to our impression, the practice isn’t new. Apparently, sellers have been quietly shrinking products to avoid raising prices for centuries, and experts think it has been an obvious corporate strategy since at least 1988, when Chock Full o’ Nuts cut its one-pound coffee canister to 13 ounces and its competitors followed suit.
The widespread impression voiced by consumers is that in the wake of the Covid 19 pandemic and the disruptions it caused in the supply chains, they are not only shrinking the product, but raising the prices. As it turns out, this may be only partly true.
According to statistics, shrinkflation was rampant in 2016 and appears to be happening less often today than it was a few years ago.
Downsizing was frequent back in 2016, when overall inflation was low. It became rarer after the start of the pandemic in 2020, and more recently it has begun returning to pre-pandemic levels, analysts from the Bureau of Labor Statistics said. (The economists noted that the set of products being measured changed somewhat over the years, making comparisons across time more a rough approximation than an exact science.)
However, while it may be happening less often today, the magnitude of the shrinkage for some products is more extreme now. What’s more, even if downsizing is not happening as often, shrinkflation today is having a big impact in a few key categories, including sweets, detergent and toilet paper.
When products shrink, it adds to inflation. Some of the ways they shrink the products are virtually undetectable even by observant shoppers: like increasing the size of an indentation in the bottom of a jar or shaving the corners from a bar of soap.
‘Shrinkflation’ is not the only deceptive practice going on. There is one that is even more sneaky, and it’s called ‘skimpflation’: this is when companies use cheaper materials to save on costs. This is much harder for the government to measure and does not figure in the inflation statistics.
If your paper towel roll costs the same but you’re getting fewer sheets — shrinkflation — that shows up clearly as a unit cost increase that is added to official inflation. If your paper towels are the same size but are suddenly made of worse material — skimpflation — the government does not record that as inflation, but the consumer experiences it as a downgrade in quality.
These strategies work mainly because consumers often pay more attention to prices than sizes—or even quality. As John Gourville, a professor at Harvard Business School said, “You don’t get sticker shock.”
How much of this deception is the consumer willing to take? Some pricing experts worry that persistent shrinkflation could drive shoppers away. But the question is, if all the companies do it, how does the consumer avoid it?
When raw material costs were climbing and inflation was in the headlines, consumers most likely understood that companies needed to pass some of those increases along. They may even have preferred smaller products to bigger price tags, several experts said.
Now that inflation is cooling, they may simply feel ripped off. “I can see consumers becoming more and more aware of the existence of shrinkflation,” said Jun Yao, a marketing lecturer at Macquarie University in Australia who has studied the trend. The practice, he said, “can backfire — and damage the brand image.”
Nevertheless, there seems to be no solution for the consumer who needs the products being manipulated by corporate greed and deception.
