Beware Of 'Shrinkflation,' Inflation's Devious Cousin

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As the cost of goods increase, manufacturers routinely pass these costs on to consumers through higher prices. A less obvious strategy is to maintain price, but to reduce the size of the product. In many ways, this downsizing should mirror a straight price increase when it comes to consumer behavior. Marketplace and experimental data show this is not the case and that consumers are more sensitive to changes in price than to changes in quantity.

Full paper here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=559482

NPR Article: https://www.npr.org/sections/money/...re-of-shrinkflation-inflations-devious-cousin

Bigger box with less food?
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More picture examples of shrinkflation: https://www.reddit.com/r/shrinkflation/
 
Shrinkflation has been around for years. It's why your former "1/2 gallon" of ice cream is only 1 1/2 quarts. One maker, however, proudly proclaims on its packaging... "still 1/2 gallon".
 
Millionaire said:
I guess it must be illegal to keep the box the same size in all these examples. Otherwise i'm sure they would have.
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Maybe not. Perhaps keeping the box the same size would shock buyers when they found it only 1/3 full. They'd probably "notice" that.
 
Ninja Mobile Trader VPS said:
As the cost of goods increase, manufacturers routinely pass these costs on to consumers through higher prices. A less obvious strategy is to maintain price, but to reduce the size of the product. In many ways, this downsizing should mirror a straight price increase when it comes to consumer behavior. Marketplace and experimental data show this is not the case and that consumers are more sensitive to changes in price than to changes in quantity.

Full paper here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=559482

NPR Article: https://www.npr.org/sections/money/...re-of-shrinkflation-inflations-devious-cousin

Bigger box with less food?
View attachment 265332

More picture examples of shrinkflation: https://www.reddit.com/r/shrinkflation/
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Careful observation will note the smaller box contains more than the larger box by weight.
 
The best thing the Australian government did for shopping consumers is to force supermarkets to put cents per 100g, $ per kg, or something similar, on all supermarket shelf price labels.

We still get the shrinkflation, but its easier to spot on the supermarket shelves.

KH
 
KevinBB said:
The best thing the Australian government did for shopping consumers is to force supermarkets to put cents per 100g, $ per kg, or something similar, on all supermarket shelf price labels.

We still get the shrinkflation, but its easier to spot on the supermarket shelves.

KH
More...

Yeah, they've been doing that in the USA for quite a while. Here it is "price per lb" obviously, hehe. You metric freaks.
 
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