An insight into “Shrinkflation”

In our busy urban lifestyle, we generally do not pay much attention while loading our grocery cart but when the bill gets generated and these thoughts starts popping-up in our minds:

Have the prices increased ?

I don’t have much items in my cart but still the bill is high. Why is it so?

Last month I took the same items but my bill was not that high!

Packaging of some of my favorite items have a new look; by any chance the items' price may have gone higher and the quantity is reduced?

By the time you plan to act on these thoughts, you have already paid the bill. Now, out of curiosity you decide to go home and compare these items with the old ones purchased last month and realize:

That packet of chips has more air than the actual chips !

Toilet paper seems to be running out faster !

Chocolate bars feel thinner !

The packaging box looks different than its old version !

Oh wait! All the items have shrunk in size, quantity and overall packaging. Well, this has a name in economics - “Shrinkflation”.

“Shrinkflation” is a?process of reducing the size or quantity of a product while the price of the product remains the same or even slightly increases in certain cases.

Is downsizing allowed without acknowledging the customers ?

This phenomenon of downsizing is followed by companies to tackle the unseen price rise for their products in a market defined by “hyper-competition”. Research shows that generally consumers do not read the packaging information instead rely on other options such as?visual impressions of package size,?total package price?or?previous purchase experience?to judge the product quantity and value. On the other hand, companies always mention that their product portfolio i.e. pricing and quantity is created based on consumer preferences and needs.

As a result of this unfavorable balance of information, package reduction can mislead consumers in the buying process which could lead to major moral and ethical concerns.

Companies do try and hide the fact that they are shrinking the sizes of their products and this is not some out of the blue technique. There is a scientific reason behind it and it’s called “psychophysics” — its essentially how people perceive changes in sizes. When you change aspects of a product from multiple dimensions then your perception is relatively insensitive to these changes in actual sizes.

Here are some illustrations of Shrinkflation and how products have been refreshed to tackle the demanding market.

Can we beat Shrinkflation ?

As per the latest trends in the economy and the way inflation is fluctuating, Shrinkflation is here to stay and grow in the future & we cannot skip it but here are some tips that we can apply in our daily grocery shopping to cut-down our costs.

Always prepare a shopping list and check their prices on a relevant mobile application?which can help you compare the product prices on various stores and get you the best deal.

For example, you can use “https://compare.buyhatke.com/" which compares prices at various outlets around the area so that one can make a informed decision while selecting a deal.

It also gives some extra useful information to help with your selection.

In some cases?when you buy in bulk it is usually cheaper. Here is an example.

Always calculate the unit price?to know which one is cheaper and worth it.

For example, a 300g of cornflakes packet could cost 1.50 rupees per 100g whereas a 400g of cornflakes packet could cost 1.70 rupees per 100g. There is a slight difference but it definitely adds up to your bill. Bigger items are not always necessarily cheaper.

Always prefer to buy local or house branded items?as they are usually not effected by Shrinkflation.

They can be cheaper as supermarket chains can cut-out the middle man and save on advertising costs. There can be promotional or discount offers in place for selected items to choose from.

Buy from budget stores?as they generally offer heavily discounted prices because of various factors like buying overstock items from suppliers.

Buy vouchers online in shopping apps?to offset the price in some cases.

The problem with our mindset nowadays is that smaller cost differences that we bear in a day, don’t seem to bother us much. However, if we start adding up these small differences, we will be shocked to see how much more we are spending in a month, a year or in five years. Hence, by following some simple guidelines you make a smarter payment choice and this can really bring down your expenses in a longer run.

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Hope, this article will help you understand the basic concept of Shrinkflation !