In last Sunday’s Consumerism Commentary Podcast, our guest from Consumer Reports, Tod Marks, talked about product downsizing. With commodity prices rising, companies — particularly food product companies — are trying to determine how they can cover their increasing production and distribution costs without losing their competitive edge.
In order to maintain the same price point, companies often shrink the size of their packaging. Sometimes, as pointed out in the podcast, companies use more air to create a lighter product, like whipped yogurt, so that there is less real product in the package. Consumers are mostly aware of these tactics. In fact, according to Consumer Reports, shoppers prefer receiving less for their money than paying more for the same product.
Kraft is a good example. While the company indicated they intend to weather their increased costs without any effect to their customers, they have already decreased the number of cheese slices in their Kraft Singles packaging, a staple in my household as a kid. Shrinking packages can only go so far; the company intends to cut costs on the corporate side. In other words, not only will consumers see shrinking packages, but some of the company’s employees might want to start thinking about polishing up their résumés.