Reduflation: Paying the Same and Receiving Less, the Phenomenon Hitting Wallets
Amidst the rising cost of living, many Colombian households feel their money is stretching less and less.
TL;DR
- Reduflation is a phenomenon where products maintain their price but reduce their size, content, or quantity.
- Consumers often react to the 'mental anchor' of a product's historical value, expecting the same amount.
- Reduflation is observed in categories like skincare, haircare, home care, packaged foods, and ready-to-eat meals.
- A survey indicates that 69% of consumers notice reductions in size or quantity without price changes.
- This implicit inflation erodes consumer trust and can lead to changes in purchasing behavior, such as substituting brands or reducing consumption.
- The effects of reduflation are economic, psychological, and social, impacting financial planning and daily decisions.