Consumers Don’t Realize How Much ‘Shrinkflation’ Is Costing Them

Research Finds Just How Widespread It Is

BALTIMORE, Feb. 27, 2026 – While inflation has cooled in recent months, consumer prices remain well above where they were five years ago, continuing to strain household budgets. But higher sticker prices are only part of the story. New research published in the INFORMS journal Marketing Science shows many consumers may be paying more without realizing it because they are getting less product for the same price.

Often referred to as “shrinkflation,” the practice occurs when companies reduce package sizes while keeping prices largely unchanged. The study finds shrinkflation has been widespread for more than a decade and product downsizing occurs far more frequently than product upsizing. The study shows that when package sizes shrink, consumers often respond by purchasing additional units, increasing their overall spending over time.

The study, “Shrinkflation and Consumer Demand,” was authored by Aljoscha Janssen of Singapore Management University and Johannes Kasinger of Tilburg University.

“The consumer psychology behind shrinkflation is fascinating,” said Janssen. “Rather than consume less to conserve their overall grocery bill, our research has found that consumers are more likely to focus on the per-unit cost and then buy more product units.”

The authors analyzed a decade of NielsenIQ retail scanner data from 2010 to 2020, covering millions of products sold across tens of thousands of U.S. retail stores. They systematically identified cases in which a product was permanently replaced by an equivalent product of a different size.

Their findings show that approximately 1.9% of products were downsized during the observation period, compared with just over 1% that were upsized. When measured by total sales, downsizing was more than five times as prevalent as upsizing.

“To be sure, shrinkflation is not an isolated or new phenomenon. It has been happening consistently for over a decade across a wide range of grocery categories,” said Kasinger. “In most cases, package sizes shrink without a corresponding decrease in price, meaning consumers end up paying more per volume.”

On average, prices per volume increased by roughly 12% in the year following a size reduction. In contrast, size increases were typically associated with slight decreases in price per volume.

To counterbalance their research, the study authors also looked at how consumers respond to size changes compared with direct price changes. Using demand estimation models, the researchers found that consumers are significantly more sensitive to price than to product size changes.

“We found that a 1% increase in price reduces sales by about 1.2%, whereas a 1% reduction in size reduces sales by only about half as much,” said Janssen. “This gap suggests that consumers are much less responsive to size changes than to price changes.”

Added Kasinger, “These patterns are consistent with the idea that firms can raise prices through shrinkflation without substantially hurting demand. From a business perspective, this is an effective way to protect margins when costs rise.”

The most common product categories where shrinkflation occurs include cereals, detergents, snacks, and sanitary products.

You can read the full study here.

About INFORMS and Marketing Science

INFORMS is the world’s largest association for professionals and students in operations research, AI, analytics, data science and related disciplines, serving as a global authority in advancing cutting-edge practices and fostering an interdisciplinary community of innovation. Marketing Science, a leading journal published by INFORMS, publishes research on quantitative marketing, consumer behavior, pricing, and strategy that informs managerial and policy decisions. INFORMS empowers its community to improve organizational performance and drive data-driven decision-making through its journals, conferences and resources. Learn more at www.informs.org or @informs.

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