Shrinkflation And A New Tool To Track Price Inflation In Real Time

Consumer prices are rising rapidly these days. Just last month, we found the discounted sale price of Campbell's Condensed Tomato Soup had risen to $0.96 per can, a rise of 13% above pre-pandemic levels (CPB).

One reason we track the price of Campbell's iconic tomato soup because the product itself has proven to be remarkably stable over time. If you stepped into a time machine and traveled back to nearly any point in time from January 1898 to the present, you could likely find the same 10.75 ounce size can of condensed tomato soup stocked for sale in American grocery stores.

That makes Campbell's iconic soup unlike other products, whose producers engage in a market tactic called shrinkflation, where they keep the sale prices the same, but shrink the size of the goods they sell. If the phrase sounds familiar, it is because the topic is increasingly popping up in the news.

 

There are lots of reasons for companies to engage in shrinkflation, but the end result is the same. You get less stuff for the same amount of spending. Whether its toilet papercat food, or packages of Hershey's chocolate kisses.

Things that don't change don't have that option. Unlike these other kinds of products, they cannot get away with shrinking the amount of goods inside their packaging. Because these goods cannot get smaller, producers are forced to pass along their higher costs from the escalating prices of the things they have to buy, which consumers see as rising prices. That difference makes these goods very useful for keeping track of how inflation is affecting your personal finances.

Speaking of which, keeping track of those price changes can be a time intensive activity. When we track Campbell's tomato soup prices, we review dozens of weekly ads to identify the prices at which retailers are selling them each time we update our database of monthly price data for the product. Our price database for Campbell's tomato soup extends back to January 1898.

1 2 3
View single page >> |

Disclaimer: Materials that are published by Political Calculations can provide visitors with free information and insights regarding the incentives created by the laws and policies described. ...

more
How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.