Comment: Is there less cereal in your cereal box? This is ‘shrinkflation’. | Comment

Sometimes what companies imagine in their attempts to maintain their profit margins is beyond us, the consumers. One of the things that gets into the news cycle is the notion of “shrinkflation.”

That’s exactly what it sounds like, the idea that the cost of the products we buy are increased by companies that essentially keep the goods the same price but reduce the amount of product we get.

Shrinkflation is just sneaky. It’s one thing when the price of the food we buy goes up 20%. We notice it, and of course we are not happy. But having the same package, staying the same price but reducing the content by 25% is shrinkage. It’s downright misleading and the last thing brands should do if they’re looking to nurture long-term relationships with their customers.

Some recent examples of shrinkage that consumers have shared on social media:

• A 32 oz Gatorade is now 28 oz.

• Wheat Thins used to weigh 16 ounces per pack, but now weighs 14 ounces.

• Some brands of toilet paper have fewer sheets.

While eating a bag of Doritos last night, I noticed that the packet had 25% less Doritos.

Some companies have been even sneakier with their cereal boxes. They kept the same height of the box but reduced the other dimensions of the box. Why? Because if you reduce the height of the box, unless all the other brands on the shelf are doing the same thing, your box looks smaller. But by reducing the other dimensions of the box, you can sell less product at your usual price and people won’t notice it immediately.

If shrinkage is an attempt by companies in tough times to increase their profit margins by offering fewer products, what about when things are looking up? When inflation drops, do we think the companies ripping us off will reverse course?

No. What they are doing now is not a course they will reverse.

Have we really reached the point where this is how companies think of consumers that has allowed them to make a profit for so many years? Obviously yes. But the problem is that consumers have nowhere to turn. As Doritos plays hard and fast with our emotions and taste buds, so will all of their crunchy competitors. While someone has to start, its success will get almost everyone following. In other words, it accumulates to create a huge cumulative loss for consumers at cash registers.

Dayle Lopez, a Seattle attorney, reminds us that it’s really not OK, that there’s a fine line here.

“False advertising comes into play here when brands intentionally reduce the amount of product they put in the same package,” he said. “It’s legal for a company to reduce the size of their packaging, but they can run into issues where they keep the same packaging and, for example, reduce the amount of product they put in by a third or a half.

In a time when brands have to fight to maintain consumer loyalty, what they really need to do is find ways to grow our dollar. Shrinkflation further tears trust between consumers and the businesses they patronize.

With consumer loyalty to brands more important than ever, it’s impossible to think of shrinkage as anything other than brands scoring on their own lens. It is hoped that they will also understand this before losing customers to competitors who keep things honest.

Aaron Solomon, JD, is Chief Strategy Officer for Esquire Digital and Editor-in-Chief of Today’s Esquire. He has taught entrepreneurship at McGill University and the University of Pennsylvania. He wrote this for InsideSources.com.

Get a weekly roundup of South Carolina opinion and analysis from The Post and Courier delivered to your inbox on Monday nights.

Comments are closed.