The ‘Bitesize’ Branding Battle

Posted in: Industry News, Press Releases | by: Olid Uddin

To quote Time Magazine: “ The feeling among some consumers that their butts are getting bigger, when in fact, it’s just the toilet paper getting smaller.”

Are we being cheated or deceived by manufacturers? Would you rather pay more or have product downsizing?

Recently, a very well known chocolate bar manufacturer has made headlines for cutting down the size of one of their famous chocolate bars yet increasing the products price.

Products are getting smaller while the price you pay stays the same.

A shrinkflation generation

Shrinking products also known as ‘shrinkflation’ began in the early 1980’s due to a rise in commodity prices. Manufacturers realised that they could financially benefit from a slump in the economy. Over the years this branding strategy has become the preferred inflation fighter.

According to Thomas J Alander – a financial professor at Northwood University, “ Businesses have little choice these days when faced with increases in costs of their raw goods. Companies only have pricing power when wages are increasing.”

When consumers are faced with a price hike, they tend to cross over to cheaper brands. By reducing the contents, but keeping the price the same, is a tactic implemented to keep customers buying their brand.

There is no obligation for food companies to inform consumers of the change in packaging size. Most companies reduce their products unannounced and some even employ the “new” labelling in the hope of enticing new interest. Other strategies are to describe the product as a relaunch, or a special offer. Deceptive tactics such as keeping the same width and height of the packaging, but putting a cut out dimple underneath the bottle so it has less content. The big question is, are we being hoodwinked into believing that less is more with regards to the content of the packaging?

Smaller packaging is being marketed as ‘greener’ and environmentally friendly. It is also perceived to be space efficient, portable and of course yes…the healthier, less fattening option. Honestly, less is always just plain LESS!!

On second thoughts, perhaps less isn’t such a bad option for the sinful fat packing calories contained in delicious, creamy ice cream and decadent chocolate delights? However who would not be disgruntled to have less tuna in a tin or fewer nappies in a packet?

What happened to the good old trusted dozen? Do the methods employed insult intelligence of the consumer or are the majority of consumers too accepting or complacent or ashamedly gullible?

What does the future hold?

Will consumers substitute their all time favourite snacks and candy bars for new, cheaper alternatives in the market? We are indeed living in consumer savvy generation that isn’t afraid of making serious changes to their lifestyle if they aren’t completely satisfied with something. The balance between customer and shareholder value continues to grow and will only get harder in time if the right action hasn’t been undertaken.

Creating real stakeholder value, being transparent and establishing consistent sustainability is what will differentiate the good from the great brands in near future. In the mean time, it looks like we all will be doubling up.

References:

http://www.nytimes.com/2011/03/29/business/29shrink.html?_r=1

http://www.thisismoney.co.uk/money/bills/article-2319424/Products-getting-smaller-price-pay-stays-same.html

http://business.time.com/2011/03/29/all-new-packaging-less-food-same-price-what-a-deal/

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