Have you ever experienced the frustration of reaching into your favorite bag of snacks only to find that it’s not quite as full as you remember? If you’re nodding along with a bag of Kroger Kettle Chips in your hand (Jalapeño is my fave), you’re not alone. Lately, it seems like the size of snack packages is shrinking, leaving us wondering if we’re getting less bang for our buck.
Let’s talk about the elephant in the room – or should I say, the shrinking bag of chips? It’s not just about chips, though. It’s about a broader trend where brands seem to be deprioritizing the customer experience, quietly reducing the quality or quantity of their products while keeping prices steady.
You might be thinking, “Why would they do that? Isn’t that a bit dishonest?” And you’d have a point. But according to Accenture’s Life Trends 2024 report, this phenomenon is part of a larger trend where companies are trying to maintain profitability in the face of rising costs and changing consumer preferences.
Think about it this way: companies are facing pressure from all sides – increased competition, higher production costs, and evolving consumer demands. In their quest to stay afloat, some companies are resorting to subtle tactics like reducing product sizes or quality to maintain their profit margins without raising prices.
Now, I’m not saying every brand is guilty of this. Some companies prioritize transparency and strive to deliver consistent value to their customers. But for others, the allure of cutting corners to protect their bottom line can be too tempting to resist.
One thing remains clear: customers value transparency, integrity, and quality from the brands they choose to support. And the practice of shrinkflation and skimpflation—where brands reduce product size or quality to cut costs—is eroding consumer trust at an alarming rate.
According to Gartner, Inc., a staggering 62% of consumers have stated that they would cease purchasing from brands engaging in these cost-cutting measures. This sentiment underscores a fundamental truth: customers expect fairness and honesty from the brands they patronize. Only a mere 7% indicated they would continue supporting a brand that resorts to such tactics.
Further insights from a Gartner survey conducted in June 2022 shed light on the prevalence and perception of this practice aptly titled shrinkflation and skimpflation. Shrinkflation, is a practice where companies subtly decrease the size of their products while maintaining or increasing prices. It is characterized by the reduction in the size or quantity of packaged goods without a corresponding decrease in price.
Companies embark on shrinkflation, under the guise of justifying their price adjustments. For instance, some products can undergone reductions from 3.8 to 3.3 ounces or from 768 to 704 wipes per package. This tactic allows companies to maintain profitability while minimizing the perceived impact on consumers.
This tactic, while subtle, is perceived as a betrayal of trust—a manipulation of consumer expectations without offering any tangible benefits in return. And it hurts consumer loyalty and brands in the long run.
In contrast, skimpflation—a decline in product quality achieved through the use of inferior ingredients or components, or a reduction in service standards such as longer delivery times is also affecting customers. And these declines, whether in formulations that alter the taste of a favorite snack or a decrease in service quality that leads to frustration, are quickly noticed by consumers and they react accordingly.
As per a recent report by the New York Times in March 2024, shrinkflation has been a prevalent occurrence for quite some time. However, heightened awareness of this phenomenon has emerged amidst inflation and rising food prices, prompting increased scrutiny from consumers.
But is this helping anyone?
And how can businesses navigate this delicate balance between profitability and customer satisfaction?
The obvious answer is NO, customers are weary of these “underhanded” tactics.
And businesses need to prioritizes the needs, expectations, and values of consumers above all else.
Without such adjustments, implications of shrinkflation and skimpflation on customer experiences and businesses are profound.
What are the implications?
There is a loss of trust and transparency and customers feel less valued.
When companies pull the shrinkflation stunt, they’re essentially saying, “Hey, we don’t think you’ll notice or care if we cut a few corners.”
But guess what?
Customers are smarter than that. They want honesty, they want fairness, and they want to feel like their loyalty is appreciated. And reciprocated.
When brands prioritize sneaky cost-saving tactics over their customers’ satisfaction, it’s like sending a message that profit comes before people. And in today’s world, where consumers have more choices than ever before, that’s a risky game to play.
When a customer has been loyal to a brand for ages, they love their products, trust them, and are willing to fork over their hard-earned cash for them. But then, they start noticing these sneaky little changes—less bang for their buck, without any heads-up from the company, that trust they had in the brand starts to waver.
They start questioning whether that company is really looking out for their best interests or just trying to squeeze a few extra bucks out of the customer. It’s like finding out your favorite restaurant skimped on the ingredients in your favorite dish.
Remember that customers expect transparency and honesty in their interactions with companies, and shrinkflation can undermine these expectations. Moreover, when products shrink without a corresponding reduction in price, customers may feel deceived or shortchanged, leading to dissatisfaction and erosion of brand loyalty.
Brands must strive to maintain transparency, integrity, and value in their dealings with consumers to foster trust and long-term relationships. By prioritizing customer needs and expectations over short-term profit gains, companies can cultivate loyalty and goodwill, even in the face of economic challenges like inflation.
Be upfront about any changes, keep the quality top-notch, and show your customers that you value their loyalty. Because in the end, a happy customer is worth a whole lot more than a few extra cents in your pocket.
Embrace a human centered approach that prioritizes the needs, expectations, and values of consumers above all else, and navigate this delicate balance between profitability and customer satisfaction.
Here is how:
- First and foremost, transparency is key. Brands must communicate openly and honestly with their customers about any changes to their products or services. Whether it’s a shift in package size or a tweak in ingredient sourcing, transparency builds trust and fosters goodwill among consumers.
- Moreover, brands should remain vigilant in maintaining the quality of their products and services. While cost-saving measures may offer short-term gains, the long-term consequences of compromising quality can be devastating to brand reputation and customer loyalty. By investing in quality assurance and customer feedback mechanisms, brands can ensure that every interaction with their product or service exceeds customer expectations.
- Additionally, brands can differentiate themselves by offering value-added experiences that go beyond the transactional. Whether it’s providing personalized recommendations, offering exceptional customer service, or creating memorable moments that resonate with consumers, brands that prioritize human-centered customer experiences will stand out in a crowded marketplace.
When we put people at the heart of business decisions, we can avoid the sneaky tactics of shrinkflation. Instead, let’s focus on delivering genuine value, maintaining transparency, and prioritizing customer satisfaction. Genuine care about our customers, gets noticed—and that trust is worth far more than any short-term gains.