Tag Archives: ethics

“Shrinkflation” Takes Hold in Product Sizing

The small things matter. Small in this case meaning the quantity in a package. In case you haven’t noticed lately, prices are going up and contents are going down.

If you’re not sure about this, consider the new sizes of common household products such as toothpaste and toilet paper. Example: A Crest toothpaste once contained 4.1 ounces of teeth-whitening product, but now contains 3.8 ounces. Gatorade was 32-ounces, but not it is down to 28 ounces. And (in case you are counting sheets) a roll of Cottonelle toilet paper has shrunk to 312 sheets, compared to its former count of 340 sheets.

Meal portions at restaurants have also been impacted. At Subway restaurants, the chicken wraps and sandwiches have less meat now. Domino’s Pizza reduced the order size of boneless wings to 8 pieces from the usual 10 pieces. Burger King is also downsizing its nugget meals from 10 to 8 pieces. What is going on?

At first glance none of this seems too alarming, but this movement is called “shrinkflation” and tends to not retreat once implemented. Shrinkflation is when manufacturers cut down on the product size or volume in a package, rather than raising the price on the customary size. This happens during times of increasing raw materials and supply chain cost increases. It’s not illegal, but it does seem a little sneaky. And, once the new sizes and prices have been accepted, new standards are in place for consumers and their wallets.

Are your foods shrinking?

Group Activities and Discussion Questions:

  1. Poll students: What have they observed in their purchases? Are the sizes or prices the same?
  2. Show video about shrinkflation: https://youtu.be/q13_06F4_HI
  3. Discuss why manufacturers are making these changes. What are the reasons?
  4. How is shrinkflation accounted for in pricing?
  5. Discuss various pricing models: demand-oriented, cost-oriented, profit-oriented, and competition-oriented.
  6. Which pricing model is being used with shrinkflation?
  7. Offer an outside assignment for teams of students. Have them visit a local store and examine products that illustrate shrinkflation.

Sources:  Patton, L. (12 May 2022). Fewer nuggets, smaller salads: Shr9inkflation hits U.S. Restaurant Diners. Bloomberg.; Skores, A. (16 May 2022). Inflation up, product size down. Dallas Morning News.; other news sources.

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Stolen Secrets: Trade Secrets and Corporate Espionage

Many students are surprised to find out that there is significant corporate espionage in America. Corporate espionage (aka corporate spying or industrial espionage) is the use of espionage techniques to steal trade secrets, intellectual property, proprietary information, marketing strategies and the like.

While students may think of corporations as stuffy places only filled with paper and computers, they neglect to consider the enormous costs (including time-to-market) that it takes to arrive at a unique product or service. And how much is customer information and sales worth? Plus, research and technology are serious expenditures and organizations pay hefty fees to protect their institutional knowledge.

One example is a chemist employed at Coca-Cola. She was recently sentenced to 14 years in prison for stealing trade secrets related to a BPA-free coating for the inside of cans and selling them to a Chinese company. Were the secrets a big deal? Yes. The trade secrets in this case collectively cost about $120 million to develop.

Other cases include trade secret thefts worth an estimated $1 billion from a petroleum company, a securities firm robbed of $4.1 million, and lawsuits of trade secret thefts between multiple companies in the technology, beauty, and chemical industries.

Not all corporate espionage is as dramatic or damaging as this example. Many employees or former employees leave companies with proprietary information or customer data. And, as might be expected, Silicon Valley is one of the world’s most targeted areas for espionage. High tech industries in computer software, hardware, automobiles, energy, biotechnology, and more are frequently targeted by thieves.

How much is lost to corporate espionage? Well, estimates vary (and not all thefts are reported) but G4S, a British multinational security services company, estimates it in the trillions of dollars each year.

Watch out!

Group Activities and Discussion Questions:

  1. Discuss the difference between laws and ethics.
  2. Ask students to define corporate espionage.
  3. What examples might students know about?
  4. What can be stolen from corporations that might be valuable? How much is that worth?
  5. Show video about corporate espionage: https://youtu.be/nwvwhM54uus
  6. Divide students into teams. Have each team do an internet search for corporate espionage examples. What happened, when, stolen, results, etc.?
  7. Have each team present their example.

Sources:  Ex-Coca-Cola engineer sentenced in trade secrets case. (10 May 2022). Associated Press.; Bloomberg News; other news sources.

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Marketing Used for Good

We commonly think of using marketing principles and practices to promote business and grow revenue. And that’s fine – up to a certain point. However, marketing can be so much more.

We know that marketing is used to grow businesses and organizations. Increased revenue usually leads to new research and development, new products and services, and strong returns for shareholders and stakeholders. Lots of people benefit from this. And that’s good. But it is only part of the story. Marketing can also be used to help society in very powerful ways.

In one example, advertising agency Havas Tel Aviv recently used it powers for good when it partnered with Laisha, a popular women’s magazine in Tel Aviv, to promote a domestic abuse hotline. A study of women in Israel had found that most women were not even aware that a  hotline number for domestic abuse even existed. Therefore, for the promotion the agency created a simple cover page for Laisha with the 24/7 helpline phone number in large white letters on a black background. Basically, making it an impossible-to-miss cover. The text stated that women who suffer from domestic violence are not alone – and that the anonymous phone line offers help in all languages.

The result: An increase in calls to the hotline by 500%!

Musicians and artists also are powerful contributors to social programs and awareness. Several years ago rapper Logic recorded the song titled “1-800-273-8255,” directing young people to the National Suicide Prevention Lifeline phone number. The song chronicled a youth’s journey through depression to a suicide prevention call. The song was nominated for Grammy awards for song of the year and best music video as well as a MTV music video award. But the most stunning result was the increase in calls for help during its release.

The results: 9,915 more calls to the support line were made in the 34-day period after the Grammy and MTV Music Award shows! The song’s impact contributed to an estimated 245 fewer suicides over the same period. That’s powerful!

Consider: Marketing makes a difference in many ways.

Group Activities and Discussion Questions:

  1. Discuss how marketers can be active with social responsibility and justice.
  2. What skill sets translate from corporations to community service?
  3. Show Logic’s video: https://youtu.be/Kb24RrHIbFk
  4. Divide students into teams. Have each team select a social issue or a community program that they admire.
  5. Challenge each team to develop a marketing tactic to highlight the ways in with the programs can help people.
  6. Alternatively, have each team research an existing social program and analyze its messaging and tactics (ex: Red Cross, Big Brothers, etc.)

Sources: Ansari, T., (Dec. 15, 2021). Rapper Logic’s song about suicide prevention may have saved hundreds of lives, study says, Wall Street Journal; Griner, D. (Dec. 2, 2021). This magazine cover boosted calls to an abuse hotline by 500%. Ad Week.

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