Chocolate: Shrinking Value or Waistlines?
By Laura Brohan | Dec 8 2016As the Toblerone changes shape, Laura Brohan looks at why we are paying higher prices for less chocolate[br]NEWSPAPERS, television pundits and internet memes all share a common opinion that 2016 has not been a good year. It has been a year of Brexit, Trump and the death of Harambe. However, its turmoil does not lie solely in the fields of international politics and economics, but also a place closer to home: supermarket shelves.As 2016’s problems grow, some of Ireland’s most beloved chocolate products are shrinking. As if the devastation of Freddo price inflation was not enough, chocolate manufacturers have now reduced the size of numerous products without a corresponding reduction in price, a phenomenon referred to as ‘shrinkflation’.The question is whether the size reduction is driven by a change in consumer demand or simply a means of increasing profits?
“some of Ireland’s most beloved chocolate products are shrinking”Toblerone, the distinctly triangular-shaped swiss chocolate bar, best known as a reliable last-minute airport gift, has been redesigned to greatly reduce the amount of chocolate each bar contains. The redesign is a noticeable downsize from the old 400g bars to the newly revised 360g bars. Its redesign is particularly perplexing as the brand have opted to broaden the ridges between the bar’s iconic triangular segments rather than simply shortening the bar. This fundamentally changes the shape of the product.In a statement released on the brand’s Facebook, Toblerone attributed the change in design to rising production costs, in particular the increased costs associated with a number of the bar’s key ingredients. Yet Toblerone is not the only chocolate treat to be hit by manufacturers struggling to maintain profit margins.Share sized bags of Malteasers and Galaxy Counters now contain less chocolate to share as Mars recently reduced the weight of these products by 14.8% and 12.4% respectively. In a statement released by Mars, the firm announced that the decision to reduce the size of the packets was an effort to maintain the price of the product for its customers while acknowledging the strain caused by the rising costs of raw materials.Mondelez International, the US conglomerate who owns the Toblerone brand, further angered consumers by reducing the size of another iconic product owned by the company: Terry’s Chocolate Oranges.Consumers’ outrage stemmed not only from the 10% reduction in size but also from the way in which the size was reduced. It is alleged by some consumers that the size was cunningly reduced from 175g to 157g in the hope that people would fail to notice the change.
“Treasured Christmas classics like Cadbury’s Roses, Heroes and Quality Street have fallen victim to ‘shrinkflation’”The confectionary sector in Ireland relies heavily on seasonal offerings at Easter and Christmas to drive profits. Unfortunately, this means that even treasured Christmas classics like Cadbury’s Roses, Heroes and Quality Street have fallen victim to ‘shrinkflation’. The tins and boxes of these festive treats have reduced in size with a number of sweets within them also being discontinued.Cadbury were heavily criticised last year when they changed the recipe of their annual Easter chocolate treat, Crème Eggs, and reduced the size of Crème Egg multipacks by one egg. The shell is now made from a cheaper variety of chocolate rather than the Dairy Milk chocolate that was previously used.A decline in sales compared to the previous year indicates that the change was unpopular with consumers. However, Cadburys claim that the fall in revenue generated by Crème Eggs reflected a shorter Easter season rather than customer dissatisfaction. An outpouring of disgust at the altered recipe on social media suggests otherwise.In the face of a growing obesity crisis, some manufacturers have cut the size of their products under the guise of tackling this issue. Mars, who hold the second largest market share of chocolate products in Ireland, announced last year that it would restrict the calorie content of its single-serve products to a maximum of 250 calories. This pledge has led to a reduction in the size of its Mars and Snickers bars.
“It is impossible to ignore the reality that shrinking portion sizes are driven by a profit-incentive”However, the reduction in the size of some of the brand’s share-sized offerings along with the single-serve products indicate the shrinkage stems solely from economic motivations rather than consumer demand for smaller products.It is impossible to ignore the reality that shrinking portion sizes are driven by a profit-incentive rather than a genuine concern for consumers’ health. Many chocolate manufacturers have seen their profits suffer as a result of rising commodity prices and increased labour costs. Shrinking the size of chocolate treats is undoubtedly an attempt to tackle the issue of increasing costs.Chocolate manufacturers must tread carefully as shrinking products do not go unnoticed by savvy consumers. In order to avoid disgruntled customers, chocolate manufacturers should perhaps instead focus on increasing revenue by diversifying their product lines rather than reducing the size of much loved products.