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Penny-wise pound-fooling: a replication with extension of the left-digit effect to the context of shrinkflation

Author

Listed:
  • Bart Claus

    (IESEG School of Management)

  • Mario Pandelaere

    (Pamplin College of Business, Virginia Tech
    Ghent University)

Abstract

(Thomas and Morwitz Journal of Consumer Research, 32(1), 54–64, 2005) demonstrated the left-digit effect (LDE): nine-ending prices influence our perception of price magnitude, but only if they trigger a change of the leftmost digit. We present a replication and extension of the left-digit effect for content reductions in the context of shrinkflation or downsizing—manufacturers responding to inflation-driven increases of unit costs by reducing size, content, or quantity of an offer without proportionally decreasing the price. We also include a replication attempt of (Lin and Wang Marketing Letters, 28, 99–112, 2017) who find that the LDE is weaker for larger quantities. As a theoretical extension, we investigate a quantity property specific to product content. Content quantities are often anchored on fractions of higher order quantities (e.g., 750 ml as 3/4, 500 ml as 1/2, or 250 ml as 1/4 of a liter). We assess whether these standardized content quantities act as evaluation anchors for downsizing.

Suggested Citation

  • Bart Claus & Mario Pandelaere, 2025. "Penny-wise pound-fooling: a replication with extension of the left-digit effect to the context of shrinkflation," Marketing Letters, Springer, vol. 36(2), pages 303-312, June.
    • Handle: RePEc:kap:mktlet:v:36:y:2025:i:2:d:10.1007_s11002-024-09758-y
    DOI: 10.1007/s11002-024-09758-y
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    References listed on IDEAS

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    1. Chien-Huang Lin & Jyh-Wen Wang, 2017. "Erratum to: Distortion of price discount perceptions through the left-digit effect," Marketing Letters, Springer, vol. 28(1), pages 169-169, March.
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    6. Jun Yao & Harmen Oppewal & Di Wang, 2020. "Cheaper and smaller or more expensive and larger: how consumers respond to unit price increase tactics that simultaneously change product price and package size," Journal of the Academy of Marketing Science, Springer, vol. 48(6), pages 1075-1094, November.
    7. Chien-Huang Lin & Jyh-Wen Wang, 2017. "Distortion of price discount perceptions through the left-digit effect," Marketing Letters, Springer, vol. 28(1), pages 99-112, March.
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