The case against bad profits via shrinkflation
Instead of offering less for the same amount of money, leading companies use innovation and transparency to overcome inflationary pressures and keep wowing customers.
Darci Darnell
IN MANY parts of the world, inflation is climbing quickly, including in the United States, where I live and where inflation is now north of 8 per cent. But even that official number seems to understate the issue. Everywhere is evidence of “shrinkflation”, the practice of getting less for the same price. Sit down at a restaurant and order using the QR code so the harried waiter can cover twice the number of tables. Buying a new car? Chip shortages and supply chain bottlenecks mean you had better be flexible on colour. Even Amazon, a company with an avowed desire to always put the customer first and a pretty strong track record of doing so, decided that Prime subscriptions would no longer include free Whole Foods delivery. Prime members still pay US$139 a year, but now they also have to pay US$9.95 any time they want something from Whole Foods at their doorstep.
As the New York Times’s The Upshot explained in a column titled “There Is Shadow Inflation Taking Place All Around Us”, this type of inflation is simply not captured in typical government data.
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