From manufacturers to supermarkets, ‘everyone is doing it’, misleading shoppers with marketing tricks and mind games to disguise rising prices.
Nitika Garg, professor of marketing at UNSW Business School, says shrinkflation, when pack sizes drop and prices stay the same, depends on shoppers not keeping up with what’s going on.
“It is a psychological phenomenon where if the change in a product is below a certain threshold, people do not realize that a change has taken place,” Professor Garg said.
‘People don’t realize that they get less or pay more for less.
‘That’s what’s happening in our market right now.
‘Everyone does it. The producers do it and the supermarkets as producers of packaged goods do it too.’
Professor Garg said many consumers may not realize what is happening to their groceries if they do not keep a close eye on prices and quantities from week to week.
She said it’s a common strategy manufacturers and retailers use when they don’t want consumers to worry about paying more. This strategy is often hidden by a marketing concept called “only noticeable difference.”
Experts say supermarkets like Coles (pictured) and Woolworths are misleading shoppers with marketing tricks and mind games to disguise rising prices
Many consumers may miss shrinking inflation if they don’t keep an eye on prices or grocery sizes as they do their weekly shopping (pictured, a Woolworths in Brisbane)
To address this practice, the federal government will implement a stronger unit pricing code, allowing customers to compare the cost of goods based on weight or volume.
Supermarkets that breach the improved code will be hit with large fines.
The measures come after the consumer watchdog received $30 million to investigate malpractice in supermarkets.
A Coles spokesperson said the company is committed to keeping prices low in its stores.
In a statement, a Woolworths spokesperson said the company is rolling out electronic shelf labels and, after listening to customer feedback, has made changes to improve the readability of unit prices.
“Changes to pack sizes for branded products are supplier-driven decisions and are not common across Woolworths’ own-brand product range,” they said.
Coles and Woolworths account for almost 70 percent of national supermarket retail sales.