Flated

Consumer prices jump the most in 4 decades, unleashing a flurry of creative ’flation

Wednesday, April 13, 2022 by Robinhood Snacks |
Navigating shrinkflation in the snack aisle (Mok Jee Chuang/EyeEm/Getty Images)

Navigating shrinkflation in the snack aisle (Mok Jee Chuang/EyeEm/Getty Images)

It’s not easy being cheesy… especially when inflation is Flamin’ Hot. Thanks to rising prices, your next bag of Cheetos may be less satisfying: food giants are shrinking their snacks to mask price hikes, just one way companies are trying to manage costs that keep going up. Last month, consumer prices rose 8.5% from last year for the biggest spike in four decades. Driving the increase: skyrocketing energy and food prices.

  • You’re not wrong: bags of Doritos are coming with five fewer chips. And Pepsi shrank the packaging of Gatorade and Wheat Thins, giving customers the illusion prices aren’t rising when they really are.

#Flation takes many forms… and some are easier to spot than others. Snack companies can cut costs just by changing packaging: shrinking it, rebranding it as “limited edition,” or both (“Birthday Edition” Oreos = smaller and pricier). And the “creativity” isn’t confined to the supermarket:

  • Swap-flation: GM is swapping out premium features like heated seats for more basic, butt-freezing alternatives.
  • Skimp-flation: Hilton and Marriott are ditching once standard services like room cleaning, making them “opt in” instead; Hyatt even nixed its mini shampoo bottles.
  • Robo-flation: Banks and airlines are using chatbots instead of employees, and labor-strapped restaurants are replacing waitstaff with QR codes.
THE TAKEAWAY

Shrinkflation could outlast inflation… Even if fuel costs return to normal this year, you might still be a few Doritos short of a full bag. Inflation’s expected to slow in the coming months as Fed rate hikes kick into gear. But just because prices cool doesn’t mean #flation strategies will disappear: experts say companies are unlikely to bring back larger sizes or free perks and services once they’ve trained consumers to expect something less.