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CNN tells us that our Orange Juice container matters.
Orange Juice Containers
Tropicana just switched its bottle.
They abandoned the beloved carafe:
The carafe has six extra ounces. As a bigger bottle, it had a wider label. Defending their decision, Tropicana says that the new cap is better while the bottle pours and stores more easily. The big problem though is that retailers are supposed to charge less for the new bottle, but some have not. Instead, suspecting shrinkflation, consumers have dipped (squeezed?) their Tropicana purchases by 10.9%.
This is not new. We have reacted to new designs from Tropicana in the past. As far back as 2009, when they switched from a label with a straw in an orange to a glass of orange juice, they had to undo the decision. By contrast, in 2011, we cheered the arrival of the carafe, probably because it replaced paper cartons. Design gurus say the carafe looks good on the breakfast table while the newest design does not.
Our Bottom Line: Thinking at the Margin
Economists like to tell us that we are always thinking at the margin. Going up or down by a little more or less, our new supply and demand decisions are rarely all or nothing. The Tropicana bottle is just one example of marginal thinking that, so far, has flopped.
Defined as a smaller container that has the same price, shrinkflation takes us to a sizing margin. In a recent study from Purdue University, 75% of the participants were aware of shrinkflation and told us where we care:
A majority also said that they are okay with shrinkflation when the price remains the same:
Of course, as economists, shrinkflation always returns us to our supply and demand decisions at the margin.
My sources and more: Thanks to the Hustle email for alerting me to the orange juice container kerfuffle that CNN and Today described. Always then, we go to Mouseprint.org for its look at shrinkflation. From there, they linked to the new Purdue food study that uncovers fascinating facts about us! (I always enjoy the unexpected path through which our sources wind.)
