ts and the interpretation of value. Package shrinking is no longer discreet: the FMCG insight platform Ideally has reported that 68 per cent of Australians have definitely or somewhat noticed the rise of smaller pack formats. The centre of this is a delicate balance between perception and reality. Consumers may accept smaller formats when they feel purposeful, but will most likely recoil when they sense erosion, or what the industry can’t quite dress up as anything other than ‘shrinkflation’. There are few better placed to unpack this than James Deysel, an FMCG expert with over 16 years’ industry experience. “Each category will have a core pack size that consumers anchor their pricing references to,” he told Inside Retail. “It would usually be a reduction in size in these core pack sizes that would trigger a shrinkflation response with consumers.” There’s a critical distinction between how a shrunk block of chocolate lands and a newly introduced smaller format, even if both ultimately increase the price per gram. Enter Cadbury, whose own handling of inflation may read as a case study in how quickly goodwill can erode. A recent Choice investigation found the brand has doubled down on shrinkflation, with its Easter egg range shrinking for a second consecutive year while prices climbed, leaving shoppers paying almost 73 per cent more per 100g than two years ago. Maintaining core pack sizes while introducing smaller alternatives would have been a more considered approach, argued Deysel. “If they keep this pack size unchanged and instead launch an alternative, smaller, pack… then consumers are a bit more forgiving.”  The Ideally research also found that 34 per cent of consumers believe smaller packs are just a money-making exercise, while 21 per cent see them as “ a marketing gimmick”.In fact, only 14 per cent believed it was being done for health or portion-controlled reasons.   Choice has long warned against this opacity, stating that “consumers deserve clear and transparent pricing so they can make informed decisions.” The concern is not merely about size reduction, but about the erosion of comparability. When pack sizes shift, unit pricing becomes harder to track at a glance, particularly in fast-moving categories where decisions can be made in seconds. And therein lies the problem: shrinkflation moves from a pricing tactic to a trust issue. It’s one that sits uneasily within an already fragile relationship between brands, retailers and consumers. The economic mechanics  Ideally’s report highlights a clear “sweet spot” in snack spending: 42 per cent of Australians typically spend $2–3, and 37 per cent spend $4–6, with small snack packs like Munchme nut packs and Funday confectionery sitting comfortably within the threshold. These prices are not arbitrary but are deeply embedded in shopper behaviour. “In some cases, suppliers have no choice but to shrink the packs to keep their price points intact,” Deysel explained. “They are forced to do this because retailers very seldom allow their profit margins to slip.” Still, not all smaller formats are born of necessity and the premium is both visible and accepted. “A chips multi-pack containing 8 x 19g packs (152g) retailing for $6 is substantially more expensive than a regular pack (175g at $3) yet consumers are OK with it because it’s ideal for portion control, lunchboxes and on-the-go treats,” said Deysel. “The smaller packs have a clear purpose, so the premium is justified” This push-and-pull between necessity and narrative defines the current moment in FMCG. Smaller packs are not self-proclaimed as deceptive, nor inherently consumer-friendly but sit in the grey space between innovation and obfuscation, shaped by inflation, retail dynamics and evolving consumption habits. As the data shows, 41 per cent of consumers say smaller packs would lead them to purchase confectionery more frequently, suggesting that the format does drive behaviour, even as it raises questions. The challenge for brands is to explain clearly, credibly and without illusion, why.