Shrinkflation is the sneaky practice where products shrink in size, but prices stay the same (or even increase). While it may seem like a small adjustment, shrinkflation has a big impact on how shoppers perceive both retailers and brands. Let’s explore why that is and what can be done to navigate the tricky waters of shopper psychology.
The Trust Factor: When Shrinkflation Feels Like a Betrayal
In the world of behavioural science, trust is a cornerstone of shopper-brand relationships. When people trust a brand, they’re more likely to remain loyal, forgive occasional changes, and recommend the product to others. Shrinkflation, however, can erode this trust. Why? Because it feels sneaky. No one likes to feel deceived, especially by the brands they love.
From a psychological standpoint, this is linked to the principle of reciprocity: The expectation that if a customer is loyal, the brand will reciprocate with fair value. Shrinkflation disrupts this balance. Shoppers might feel that the brand is taking advantage of them, breaking the unspoken contract of trust and fairness. This can lead to feelings of betrayal, making customers more likely to switch brands or buy less frequently.
What can brands do? Transparency is key. Instead of trying to slip changes under the radar, brands could be upfront about why they're reducing sizes. Maybe raw material costs have increased, or there’s a commitment to reducing waste. Whatever the reason, communicating it clearly can help maintain trust, even if the news isn’t great.
The Pain of Paying: How Shrinkflation Triggers Loss Aversion
Shrinkflation doesn’t just affect trust, it also plays into one of the most powerful concepts in behavioural economics: Loss aversion. Humans are wired to feel losses more acutely than gains, and shrinkflation hits this nerve directly. When a product shrinks, shoppers may not consciously register the change straight away, but when they do, it’s often perceived as a loss, or a reduction in value for the same price.
This perception of loss can be particularly potent because it’s unexpected. Shoppers anticipate price increases and can rationalise them to some extent, but getting less for the same price without any warning or explanation feels unfair. This can result in a stronger negative emotional response, leading to dissatisfaction and negative word-of-mouth.
What can brands do? To counteract loss aversion, brands could consider offering something new or different along with the size reduction. This could be a minor recipe tweak, an added feature, or even a rebrand that emphasises some new benefit. If the shopper feels they are gaining something in exchange for the smaller size, the sting of loss is softened.
The Power of Comparison: Shrinkflation and Social Proof
Another key aspect of shopper psychology is social proof: The idea that people look to others to guide their own behaviour. When shoppers notice shrinkflation, they talk about it, whether through social media, reviews, or good old-fashioned word of mouth. This collective observation can quickly turn into a negative feedback loop, where everyone starts noticing and complaining about product downsizing.
Once social proof turns against a brand, it’s tough to regain favour. People might start comparing brands, looking for those that offer better value, and once they switch, they might not come back. Brands that engage in shrinkflation can find themselves in the uncomfortable position of being compared unfavourably to their competitors, even if the competitors are engaging in similar practices.
What can brands do? Social proof can work both ways. If brands know shrinkflation is unavoidable, they can get ahead of the narrative. Engaging influencers, creating campaigns around sustainability, or partnering with consumer advocacy groups can help shape the conversation in a more positive direction. If people see others accepting or even celebrating a brand's actions, they’re more likely to follow suit.
Retailer Perception: The Middleman in the Crossfire
Let’s not forget the retailers. Shrinkflation doesn’t just affect how shoppers see brands, it also impacts their perception of the stores that carry those brands. If customers repeatedly encounter shrinkflation at a particular retailer, they might begin to associate that retailer with lower value, even if the retailer has no control over the product sizes.
This is a classic case of association in psychology. The negative feelings towards the brand can bleed over into feelings about the retailer, especially if the shop isn’t offering clear pricing or promotional information. Over time, this could result in reduced footfall or lower customer loyalty.
What can retailers do? Retailers should work closely with brands to manage shrinkflation transparently. They can use in-store signage or online descriptions to clearly communicate changes, maybe even highlighting products that haven’t been downsized as a selling point. Additionally, offering promotions or discounts on items that have been reduced in size can help maintain the perception of value.
Final Thoughts: Shrinkflation Doesn’t Have to Be a Deal breaker
Shrinkflation is tricky, no doubt about it. It taps into some deep-seated psychological responses that can negatively impact how shoppers view both brands and retailers. But it’s not all doom and gloom. By understanding the psychology behind these responses, you can take proactive steps to manage perceptions and maintain customer loyalty.
The key is communication, transparency, and offering something of value in return. If and when you strike the right balance, you can navigate the challenges of shrinkflation without losing the trust and loyalty of your customers. So next time you notice your favourite snack looking a little smaller, remember, it’s not just about the product, it’s about the psychology behind it.
