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The Effects Of Shrinkflation On Brand Reputation : The Case Of Dairy Products In Romania

Author

Listed:
  • Claudiu-Cătălin MUNTEANU

    (Institute of Agricultural Economics, Romanian Academy, Bucharest)

  • Alexandru-Narcis BOZGĂ

    (Faculty of Management, Economic Engineering in Agriculture and Rural Development, University of Agronomic Sciences and Veterinary Medicine of Bucharest, Romania;)

Abstract

Shrinkflation is a form of package downsizing that allows companies to maintain operating margins and increase sales volumes while maintaining profitability. It is widely used in practice based on the premise that consumers are deterred more by higher prices than by smaller packaging. This study determines the effects of shrinkflation on brand reputation by analyzing brand perception and consumer response to three shrinkflation-related scenarios for dairy products. Results show that while shrinkflation has little to no influence on brand perception, it significantly alters consumer response, especially in the scenario consisting of package downsizing without any price modification. Therefore, shrinkflation alters brand reputation by increasing consumers’ degree of skepticism towards the brand and challenging brand superiority claims. As consumers become increasingly frustrated by package downsizing, brand reputation tends to suffer even in shrinkflation scenarios that also include price modifications

Suggested Citation

  • Claudiu-Cătălin MUNTEANU & Alexandru-Narcis BOZGĂ, 2022. "The Effects Of Shrinkflation On Brand Reputation : The Case Of Dairy Products In Romania," Agricultural Economics and Rural Development, Institute of Agricultural Economics, vol. 19(2), pages 281-292.
    • Handle: RePEc:iag:reviea:v:19:y:2022:i:2:p:281-292
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    References listed on IDEAS

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    More about this item

    Keywords

    shrinkflation; package downsizing; brand reputation; brand perception; consumer response.;
    All these keywords.

    JEL classification:

    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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