Groceries: Same Price, Less Product

In the increasingly critical push to cut costs while avoiding layoffs, some companies are finding a solution in the mantra “same price, less product.”

Last night on NPR I heard Michelle Norris interview Ben Popkin of The Consumerist, a consumer advocacy blog, about the recent trend of companies decreasing the size of their products in grocery stores while maintaining the same price, effectively raising prices on the sly.

Key Takeaways:

• Products are shrinking
• Prices remain the same
• In many cases packaging remains the same size but the actual content is reduced (e.g. a gallon of ice cream; the amt. of cream + milk is down while the amt. of air is up)
• Examples:
  • Boxes of Kellogg’s cereal down 2.4 oz. (e.g. 14.5 oz. to 12.1 oz.)
  • A tub of Country Crock is down 6%
  • Edy’s Ice Cream is down to 1.5 quarts from 1.75 quarts
• What’s good about it? Companies are coming up with creative ways to cut costs without layoffs.
• What’s bad about it? Companies are trying to sneak the cost-cutting measures past consumers without anybody noticing
• What might happen? Decreasing the size of product might save companies a few bucks and help stave off layoffs, but consumers might decrease their spending on those products in favor of companies that resist the shrink (e.g. Blue Bell Ice Cream, which proudly states, “never shrunk.”)
• My advice? Companies should employ one of these true-to-form ad slogans:
  • “Buy 2 get 1 whole!”
  • “Sale! 1/2 off everything except the price.”
  • “Now with even more air!”
  • “Great taste, less filling (this time we mean it)”

Update: I just found this website that keeps track of shrinking products: http://incredibleshrinkinggroceries.com/

You can listen to the interview on NPR, or here’s the transcript:

TRANSCRIPT

Michele: Now we go from rising prices at the pump to shrinking products on grocery shelves. Your eyes are not playing tricks on you. Cereal boxes, juice containers, bars of soap, jars of mayonnaise. All these products and more really are getting smaller. But here’s the hitch, you’re buying less, but not paying less. Reducing the size of products is one way that manufacturers can cope with their soaring costs. Ben Popken is the editor of a consumer advocacy blog called Consumerist.com. He’s been closely monitoring this trend, and he joins us now. Mr. Popken welcome to the program.

Ben: Hi, thanks for having me.

Michele: Now I’m just curious, have you been skulking around grocery store aisles looking for examples?

Ben: No, unfortunately, I sit in my blogging chamber upon high and I just receive reports from the readers, they dispatch what they’re finding out at the supermarket.

Michele: And what are you hearing from the provinces?

Ben: I’m hearing the sound of shrinking, basically. What we call the “grocery shrink ray” is in full effect across America. Leaving all sorts of shrinking boxes and products in its wake.

Michele: Can you give me a few examples?

Ben: Definitely. Kelloggs, a wide variety of cereals are down 2.4 oz. Breyers Ice cream, 56 oz to 48 oz. Edy’s Ice Cream, 1.75 quarts to 1.5 quarts. Dog Food… Butter…Country Crock is down 6%. It’s just all over the board.

Michele: Now, these changes sound slight. I mean if you weren’t looking out for this, would it be evident that the Country Crock tub is smaller than it used to be?

Ben: Probably not, unless you are some sort of savant who is able to memorize the net weight of all of the items that you purchase in your grocery trips, you are probably not going to notice it. But, right now we’re in a crossover, a threshold phase where there are still a few of the old products left on the shelf, and when you see two different sizes being sold for the same price right there in front of you, that’s when you notice.

Michele: You know there’s always been talk about not wanting to break these benchmark amounts for product manufacturers. A gallon of milk for instance, or a pound of bacon. But it seems like we’re seeing them cross that threshold now. I’m thinking of the half-gallon of ice cream, that was always the standard. That rectangular brick of ice-cream that you used to see in the frozen food section.

Ben: That is definitely no longer the case. There’s a whole sort of secret underbelly in the ice cream world of who’s delivering less and how much air is in it versus, you know cream and milk. Some brands even make it their marketing distinction, and they put it right on the label. Like, Brigham’s Ice cream and Blue Bell Ice Cream they proudly state “Never Shrunk.”

Michele: Do manufacturers ever alert customers? Or at least provide some information in the fine print that they’re doing this? Does Wrigley for instance, note somewhere on the label that the 17 stick “Plenty Pack” is now a 15 stick?

Ben: The only disclosure that they are giving people is the different net weight and the amount of servings per package. The newest victim of the Grocery Shrink Ray that we saw today were these Kraft slices of swiss cheese and they’re now giving 10 slices instead of 11 slices, and they’re doing a different package. In this case there’s a slight disclosure, but it has a little spin on it. There’s a little green label and it says “sensible serving” so they’re trying to tap it into the whole obesity crisis, and think that by giving you less for the same amount of money, decreasing your purchasing power, they’re actually helping you out, fitness-wise.

Michele: Now, the food manufacturers will say that they’re trying to get by too, they’re facing rising fuel costs, rising commodity costs. So, they may be shrinking the package but they’re doing that instead of raising costs, which might be much worse.

Ben: Well, I don’t think that they’re trying to do it to do anyone any favors, except for themselves. I mean everyone’s got to get by. The economy is getting tighter, and I think everyone recognizes that. The problem is that they’re trying to, you know, sneak it across the table without people noticing. So, when that works on the large swath of myopic consumers, that’s great and that works out for them. But, when you have people who are actually paying attention to these things, then it’s going to be a problem for both the consumer and the manufacturer because then people feel like they’re being tricked. I think more and more people, as times are getting tougher, as people are watching their pennies more, they’re becoming much more sensitive to value and these manufacturers maybe biting themselves in the butt.

Michele: Buyer Beware.

Ben: Definitely. Caveat Emptor.

Michele: There you go.

Ben: I mean the fact that the Romans were able to invent a word, it’s nothing new.

Michele: Ben Popken, thanks so much it’s good to talk to you.

Ben: Thanks Michele.

Michele: Ben Popken is the editor of a consumer advocacy blog called consumerist.com

Image credit: My shockingly amateur PhotoShop skills

Tagged as: Consumerist, Groceries, Grocery Shrink Ray, Kellogg's, NPR, Packaging, Price Increase, Pricing