I’ve devoted many columns to the topic of product shrinkage – where a product’s price stays the same, but the contents of the package are downsized. I continue to receive many more emails than I have the space to share each week, but a common theme runs through many of these letters: “Just charge us a little more and keep the product the same!”
I have to agree – this rings true to me too. I wouldn’t have to amend my cake mixes to get the same size cakes if my favorite brands would just raise the price a little and keep the mix the same. So why don’t they?
Here’s an email from a marketer with a perspective that may surprise you:
I worked in market research for a well-known food products manufacturer. Every now and then a company inevitably needs to make adjustments for increased costs. Consumers sometimes forget that companies also deal with rising ingredient and raw material costs as well as employees who expect pay increases and continued benefits. Companies have learned over the years that a price increase results in reduced sales. A shrinkage strategy may result in consumer complaints, but it doesn’t have as negative an impact on sales.
I spent hundreds of hours moderating consumer focus groups where consumers assured me that they would rather have a company leave the product size the same and just increase the price. When that approach was followed, the consumers proceeded to punish our company for the price increase by reducing the consumption of our products. I am sure that other companies have experienced the same result, hence their preference for a shrinkage strategy versus a price increase.
I’ve seen an interesting phenomenon with regard to product shrink too. Once one brand downsizes its product, competitors are usually quick to follow. When we noticed cake mixes beginning to downsize more than a year ago, one brand made smaller cake mixes, then another and then another. Certainly, all brands are likely facing the same increases in raw materials and production costs, but to me it had the appearance of one brand opening the door for the rest to downsize. Even store brand cake mixes have downsized.
Complaining to the company is one option, but when all of the competitors downsize their products too, what’s a shopper to do? With an item like cake mix, companies have to know that if they downsize too much, consumers will just make their own. I’ve found that I’ve stopped buying cake mixes unless they’re what I’d call “crazy-cheap” as part of a coupon deal. (For example, last week, a brand name of cake mix was on sale for .49 a box at my store. I bought two with a .75-off-2 coupon and paid .23 for two mixes!)
Regular readers of my column also know that I’ve come up with my own solution to the smaller cake mix problem. I keep a batch of cake mix “upsizer” in a mason jar in my kitchen to replace the missing three ounces in cake mixes. When I first came up with this recipe, I had no idea how popular it was going to become. Over the past year, this recipe was featured on the “Today Show”, NBC News and Yahoo, which tells me that I’m not the only one irked about smaller cake mixes. I can’t think of a better Smart Living Tip to start my first column of 2014 off with!
Three-Ounce Cake Mix “Upsizer”
1 1/2 cups all-purpose flour
1 cup sugar
2 teaspoons baking powder
1/4 teaspoon baking soda
Whisk all dry ingredients together and store in a clean mason jar. When you wish to increase a 15.25-ounce cake mix to 18.25 ounces, add three ounces of this mix (6 tablespoons) to your existing cake mix and bake according to directions.
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