Shrinkflation: companies giving you less product for the same price

We asked people to send us examples of their favourite groceries that have had a mini-me makeover. Top of their hit-list was Rose’s Marmalade which has downsized from 500g to 375g.

Chris told us it’s now a very expensive product and he no longer buys it. “What’s worse is it’s easy not to notice the change if you were in a hurry as other aspects of the packaging are identical. This tactic is dishonest and displays a complete disregard for the consumer,” said Chris.

Natalie said she isn’t a happy camper. “I live remotely and only shop every 2 months so now I run out of marmalade early.”

Helen told us she needs to return to her early married days and make her own marmalade.

People are so disgruntled about Rose’s marmalade shrinking that there’s even a dedicated Australian blog about it.

In a 2023 Global Inflation Monitor survey of 33 countries, 46% of consumers said they have noticed shrinkflation. It’s even higher for New Zealanders – with 55% noticing the tactic and the same number (55%) saying the practice was unacceptable as a way of responding to rising costs.

Our readers reflect this sentiment, responding to our shrinkflation callout with examples of pet food, chocolate bars, pasta, biscuits and toilet paper that have all shrunk.

What is shrinkflation?

Shrinkflation reduces a product’s size or quantity while keeping the price the same. While the practice is nothing new – consumers have been complaining to us about shrinking products for several years – it’s another blow to how far the budget goes in the cost-of-living crisis.

Professor of marketing analytics at Massey University, Bodo Lang, said the issue of shrinkflation is a tactic used by industry to sneakily maximise profits.

“Fundamentally, manufacturers can increase their profits in two ways. Either increase the price and keep the quantity the same, or keep the price the same and reduce the size of the product. Price increases are risky for a brand because consumers are sensitive to them, so manufacturers tend to avoid them. That’s where shrinkflation comes in.”

Professor Lang said shrinkflation is a subtle way to increase profits. Spotting weight differences is more difficult than noticing a price increase. Also, because shoppers only spend a few seconds choosing a product, it’s easy to be misled by a smaller pack size and a stubbornly high price.

“Cheese is a good example. Big blocks used to be 1kg. However, over the last few years odd sizes have popped up like 800g or 900g. If these smaller blocks are sold for the same price as a 1kg block, that’s a sizable price increase, which gobbles up the grocery budget,” said Professor Lang.

While companies blame increased raw material and fuel costs, supply chain issues and global economy issues for shrinkflation, Professor Lang said another driver is the lack of competition at multiple points in New Zealand’s food supply chain. This includes the small number of global food companies that dominate the supermarket shelves and a highly concentrated grocery retailer sector.

Is shrinkflation legal?

Unfortunately, yes. There’s nothing stopping companies from reducing the size of their packaging by stealth. Instead, consumers are left to use unit pricing to identify if products have shrunk in size and help them get the best bang for their buck.

We think companies have a responsibility to communicate these changes to consumers to ensure they aren’t being misled about the products they buy.

Consumer NZ head of research and advocacy, Gemma Rasmussen, said companies could communicate quantity size changes through their websites or social media channels.

Last year, the French supermarket chain Carrefour took matters into its own hands. The chain put warning labels on shelves advising customers when a product had shrunk in size.

What groceries have shrunk?

We asked our supporters to send us examples of products that have shrunk in size but not price. Where we’ve listed the unit price, information was provided by supporters or calculated from historical website data. It was not possible to calculate unit prices for all products.

We also asked companies to explain the reasons for the shrinkage.

Rose’s English Breakfast Marmalade

This was our most popular shrinkflation complaint.

A Kraft Heinz spokesperson told us that, like most companies, it has experienced significant cost increases in virtually all aspects of manufacturing and supply but particularly for the fruit ingredients. “We have absorbed increases where we can and have otherwise taken actions such as re-sizing offerings to ensure that we can keep products on shelf and affordable for consumers whilst maintaining our high-quality standards.”  

Jimbo’s Fresh Pet Food

Shrinkflation has also crept into the pet food aisles. Tina has three cats and two dogs, so her weekly pet food shop isn’t cheap.

“One of my cats – Roxy – is ‘plus-sized’ and eats three tubs per week. Imagine my chagrin when the company decreased their tubs. I would have stopped buying Jimbo’s but Roxy rules the roost and won’t eat other brands.”

A Real Food Pet Company spokesperson told us in May 2023 that it was unable to absorb the increasing cost of delivering Jimbo’s products. “We tried many options to maintain our pricing. In the end we opted for a small change in pottle size so we could keep the same quality without a change to our recommended price. To provide transparency to our customers we posted the change to our social media pages at the time.”

Kellogg’s LCMs Choc Chip

It’s a double-whammy for this lunchbox snack. Not only has the product size reduced from 22g to 20g, but there’s now only five bars in the box instead of the original six.

Kellogg’s told us that it was necessary to review the price of its products from time to time. “With food production costs the highest they have been in decades, in July 2023, we reduced our pack size.”

Snickers Bars

Chocolate lovers bemoaned the decrease in size of a Snickers Bar. Other chocolate products we got shrinkflation complaints about were Pixie Caramel, Toffee Pops and Moro Bars.

Mars New Zealand told us the 44g Snickers bar was launched in 2022. “We are facing rising cost pressures across our operations, driven by a range of external factors. While we continue to absorb cost increases, changes to product weight is sometimes necessary to ensure we can continue to supply our chocolate bars.”

Peckish Rice Crackers

A staple in many lunchboxes, people were annoyed at the 10% decrease in a packet of Peckish Rice Crackers.

The company did not respond to our request for information about this product.

How to save money at the supermarket

The easiest way to compare the price of products, regardless of the packaging size, is to check unit prices. Unit prices show the cost per unit measure – for example, per 100g. There’s a list of measurements stores must use based on the product type. For example, meat must be priced per kilogram, drinks per litre and toilet paper per 100 sheets.

The unit price has to be shown “clearly and legibly”. The font size of the unit price must be at least 25% of the font size of the price. It must also be displayed close to the price.

Unit pricing became mandatory on 31 August 2023, but supermarkets were given 1 year’s grace to comply. They get another year – until 31 August 2025 – before their websites must display unit pricing, too.

Some products are exempt from having to display unit pricing, such as alcohol, tobacco, magazines, flowers and toys. Smaller stores, under 1,000sqm, don’t have to display unit pricing – but if they choose to, they’ll have to stick to the unit pricing rules.

Here’s our tips for using unit pricing.

Compare different product sizes

Unit pricing shows you how much a product costs per unit measure if it comes in different sizes. For this example, it’s cheaper to buy the biggest packet. If a product is on special, the unit price will change to reflect this.

Compare different product types

If you’re making pizza, you might wonder how much more you’ll pay for the convenience of pre-grated cheese. The different product sizes make it difficult to compare prices until you check the unit pricing. Per kilogram it’s cheaper to buy the grated bag compared with the 500g block, but the cheapest option is to buy the 1kg block and grate your own.

Compare brands

It’s difficult to compare product prices if a product comes in irregular packet sizes. But with unit pricing you can see the Whittaker’s chocolate is the best buy.

Compare bulk-bin foods to packaged products

You can check the unit price to work out whether it’s cheaper buying from the bulk bin. You’ll often find a packaged product that’s cheaper.

Check if a ‘special’ is worth buying

Supermarket aisles are awash with “specials” tags, such as “Extra low”, “Super Saver” and “Member price”. Unit pricing is your best friend when it comes to working out which product is the best value. It’s also a good way to check if a multi-buy offer is also the best deal.