Shrinkflation Defined – Are Companies Tricking You Into Paying More?

Say you’re at the grocery store. As you grab a bottle of your usual detergent, you notice it feels a little lighter than usual. Checking the label, you see that it’s only 89 ounces, while the old bottle was 92 ounces. But the price hasn’t changed.

It’s the same with the other items on your list. The box of cereal that used to weigh 20 ounces is now 19. The 56-ounce tub of ice cream shrank to 48 ounces. But all the prices are the same as before. What’s going on here?

What you’re looking at is inflation’s stealthier cousin, shrinkflation. This portmanteau, a blend of “shrink” and “inflation,” describes how companies try to smuggle price increases past consumers’ by hiding them in smaller packages.

What Is Shrinkflation?

When the cost of making a product goes up, companies have to raise the sale price to keep making a profit. The problem is consumers notice when prices rise. They may respond by buying less of the product or switching to a cheaper alternative.

Shrinkflation is a sneaky way around this problem. Instead of raising prices, manufacturers make the package smaller. They’re betting customers won’t notice the smaller package as long as the retail price stays the same. And often, they’re right.

In theory, paying the same price for less of a product is the same as paying a higher price for the same amount. But as a 2004 Harvard study (via NPR) shows, buyers are more price-conscious than size conscious. They’re more likely to switch products when the price goes up than when the package shrinks.

That makes package downsizing a smart choice for companies. Companies have been doing it for decades, possibly even as long as 100 years. But it wasn’t until around 2010 that economist Pippa Malmgren coined the term “shrinkflation” to refer to the practice.

And shrinkflation isn’t limited to food products. For instance, it can show up in real estate when the average apartment size in a hot rental market shrinks. We’ve also seen it in air travel, with airlines shrinking their seats to fit more people on each plane and cutting back on perks like free meals and baggage.

How Shrinkflation Works

Consumer advocate Edgar Dworsky has been tracking the phenomenon of downsizing for decades. And over the years, he’s seen manufacturers use all kinds of tricks to disguise their smaller packages. 

Often, they try to keep the new package the same height as the old one. Changes in height are more noticeable than changes in width or depth. (If you don’t believe that, check out the illustration published on ResearchGate, which shows how the same volume of liquid looks bigger in a taller, narrower glass.) 

Sometimes, companies even make the new package taller than before. Its greater height makes it look bigger rather than smaller. A Reddit group devoted to shrinkflation shows how General Mills did this with two boxes of cereal.

Sometimes companies don’t downsize the entire package. Instead, they reduce the size of the product inside the package. For instance, the Endless Thread podcast relates how each sheet of Charmin toilet paper shrank by 0.5 inches in width and 0.25 inches in length in 2020.

Another sneaky trick for hiding shrinkage is to tweak the shape of the package. Dworsky’s website documents how Skippy peanut butter jars shrank from 18 ounces to 16.3 in 2008 without changing at all in height or diameter. Instead, Skippy deepened the divot on the bottom of the jar, replacing peanut butter with empty space.

Toblerone pulled a similar stunt with its chocolate bars in 2016. The company reduced the size of the bar from 170 grams to 150 by adding more space between the wedges of chocolate. But in this case, the move backfired, leading to complaints and the eventual return of the larger bar.

Companies even try to pull the wool over your eyes by using words like “more” on the label when you’re actually getting less. Cottonelle did this in 2016, adding the words “20% more sheets!” on a package of toilet paper rolls that shrank from 418 sheets to 380. You had to look closely to see that it meant 20% more sheets than a competing brand. 

Causes of Shrinkflation

When asked about their reasons for shrinking products, companies don’t always answer truthfully. 

For instance, when Endless Thread asked Charmin about its reasons for shrinking its squares, a spokeswoman said the new smaller sheets were softer and more absorbent. These “innovations” in design, she claimed, allowed customers to “do a lot more with less paper.”

When NPR asked General Mills about its reasons for shrinking its cereal boxes, a spokesperson said the change was to “create consistency and standardization” in box sizes. They also argued that the smaller boxes allowed “more efficient truck loading,” so the company could use fewer trucks to ship its cereal, thus fighting global warming.

Only at the end of the statement did the true answer slip in: “as well as offsetting increased costs associated with inflation.” Like other price increases, shrinkflation happens mainly due to pricing pressure on manufacturers due to higher production costs and market competition.

Higher Production Costs

Speaking on the Endless Thread podcast, Dworsky says he often calls manufacturers to ask about their reasons for package downsizing. Their most common response is that their costs have increased.

Often, this reflects an increase in the price of raw materials used to make a product. For instance, higher grain prices could make it more expensive to produce cereal or pasta. 

These higher production costs cut into companies’ profit margins. That makes their companies look less appealing to investors. If they don’t do something to get profits back up, the price of their stock shares is likely to fall.

Prices for materials can rise for many reasons. Weather emergencies like drought, floods, or wildfires can affect crops. Major events like wars and disease can also disrupt supply chains. One notable example is the COVID-19 pandemic, which caused major disruptions in 2020 and 2021. 

Production costs can also rise due to increases in the cost of other inputs, such as labor and fuel. One material that affects the price of nearly everything is oil. Higher prices make it more expensive to ship materials and finished products, increasing costs at every stage of production. 

Dworsky recorded an example of this in 2008. When he asked the makers of Skippy peanut butter about their shrinking jars, they cited higher “manufacturing and transportation costs” due to rising oil prices.

Market Competition

Another factor behind shrinkflation is competition between companies. If only one company makes a particular product, it can raise its prices openly because consumers have no other choices. For instance, there’s no other smartphone quite like the iPhone, which is how Apple can get away with charging $999 for it.)

But that’s hard to do when there are a lot of competing brands. If the price of a jar of Skippy goes up, customers could simply switch to Jif or Peter Pan. Since raising prices could cost them customers, manufacturers rely on package downsizing to maintain their profit margins.

Examples of Shrinkflation

Remember those old “don’t squeeze the Charmin” ads from the 1970s and 1980s? There was a lot more to squeeze back then: 650 single-ply sheets per roll. Today, even the biggest “super mega” roll has only 366 double-ply sheets. The Charmin has squeezed itself! 

That’s just one of the many examples of shrinkflation recorded on Dworsky’s website, Mouse Print. Some other cases from his March 2022 issue include:

• Raisins. Sun-Maid downsized its container from 22.5 ounces to 20. The new canister is just as tall but narrower at the top.
• Yogurt. Years ago, yogurt used to come in 8-ounce cups. But the new Chobani Flip cup is just 4.5 ounces, reduced from 5.3.
• Soap. A “bath-size” bar of soap weighed 5 ounces back in the day. Now, Dial’s bath-size bars are 3.2 ounces, down from the previous shrinkage to 4 ounces.
• Candy. A bag of Milky Way Fun Size candy bars shrank from 11.24 ounces to 10.65 ounces. The individual bars are still 80 calories each, so there are probably fewer of them in the bag.

Shrinkflation isn’t always about package size. In some cases, the product’s quality gets cut. For instance, in June 2021, Breyer’s stopped including vanilla bean flecks in its lactose-free ice cream — but it didn’t stop including them in the picture on the carton.

Another ice-cream incident occurred in 2020, when Haagen-Dazs started adding coconut oil to the chocolate coating on its ice cream bars. Consumers actually sued Haagen-Dazs claiming it improperly labeled the coating as “milk chocolate.”

How to Spot and Avoid Shrinkflation

Regardless of the reasons behind it, shrinkflation costs you money at the grocery store and elsewhere. Fortunately, you can protect yourself using many of the same strategies you’d use to save on groceries in general.

1. Check the Packaging

A new product package is often a smaller package. So if you notice the package for one of your favorite brands looks different, check to see if its size has changed too. Changes to look out for include:

• A redesigned label 
• A differently shaped container
• Phrases like “new” (as in “new look”) or “more” on the label
• An entirely different type of container, such as a squeeze tube in place of a bottle

2. Check the Net Weight

You can’t rely on your eyes to detect product shrinkage. Companies are very clever at disguising it by tweaking the shape and design of the package. But one thing they can’t hide is the net weight, which the law requires them to list on the front of many product types.

One way to spot downsizing is to memorize the net weight of goods you buy regularly. That way, if one of your favorite products downsizes from 32 ounces to 30, you’ll notice it right away.

If you can’t keep a list of package sizes in your head, write them down in a grocery price book instead. Whenever you shop, you can quickly check the package on the shelf against its listing in the book to see if the size has changed.

3. Read the Nutrition Label

Another place to look for signs of shrinkage is a product’s nutrition label. If the number of calories per serving has suddenly dropped, that could be a sign the portion size is smaller.

Smaller portion sizes aren’t always a sign of a hidden price increase. Sometimes, the manufacturer is just trying to make the product look healthier. That’s why some candy bars claim to be two servings even though almost everyone is going to scarf down the whole bar at once.

To see if a reduced portion size is a way to cover up downsizing, check the “servings per container” listing as well. If the number of servings is the same but each individual serving is smaller, you’re looking at shrinkflation.

4. Check the Unit Price

Suppose you can tell a package is a bit smaller, but you aren’t sure how much that affects your bottom line. How much faster will you go through that 16.3-ounce jar of peanut butter than the 18-ounce one? And how much more will it cost you overall?

To answer these questions, focus on the unit price. That’s the price per unit of size: ounces, quarts, or whatever the measurement of the product is. Some stores list the unit price for each product right on the shelf. If yours doesn’t, you can calculate it easily by dividing the price by the package size. 

Once you know the unit price, you can easily compare it to the old unit price in your grocery price book to see how much it has increased. You can also compare it to the unit price of other brands to find a better value.

5. Check the Rest of the Store

When a product gets downsized, the store doesn’t get rid of all the old larger packages right away. They may be on the back of the shelf or move to another section of the store. If you hunt, you might be able to unearth a package in its original size.

Dworsky did this in 2021 when checking on the price of Cocoa Puffs cereal. The cereal aisle contained only the new ones. But in the back of the store, he found a stack of the original larger boxes — and both packages rang up at the same price.

6. Buy Competitor Brands

If your favorite brand downsizes, check competing brands. Companies don’t downsize their products at the same time, so if one jar of mayonnaise is smaller, another jar might still be full-size.

However, the fact that the competitor’s brand comes in a bigger container doesn’t necessarily mean it’s a better buy. Comparing the unit prices on both products is the best way to determine which one gives you more for your money.

7. Buy Store Brands

When comparing brands, don’t overlook the store brand. These generic products are often the last to downsize. Even if every other bottle of orange juice shrinks to 59 ounces, the store brand could still be a full 64 ounces.

In fact, even if the store brand’s package is the same size as others, it’s still likely to be a better value. Generic products cost less than name brands and are often just as good in quality. If the difference in unit price is significant, it’s worth trying it to see if you like it.

Final Word

There’s one more thing you can do to fight shrinkflation: complain. Call or write to manufacturers and tell them if they’re going to raise prices, they should do it openly instead of trying to hide behind a smaller package.

If you’re really mad about product shrinkage, back up your complaint with a threat. Let the company know you’re going to stop buying its products and switch to a brand that hasn’t downsized. If enough customers threaten to switch, the manufacturer may decide to give up on package downsizing and just price its products honestly.

Check out our other articles for more ideas on protecting yourself from inflation.