Australian Mineral Makeup and Cosmetics Company, Alexami, Defies Product Shrinkage Trend

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Product Shrinkage is on the rise thanks to commodity price fluctuations and the GFC, yet one courageous new Australian natural cosmetics company is doing its part to reverse the trend.

Alexami Mineral Makeup Comparison Chart

It’s becoming more common for people to check labels to avoid toxic ingredients,but consumers should compare product sizing while they are shopping too

‘Product Shrinkage’ is on the increase across the globe, but one Australian natural cosmetics company is aiming to halt the trend. Alexami Cosmetics, a professional-grade natural mineral cosmetics brand distributed across Australian beauty salons, spas, hair salons, naturopaths, skin clinics and other beauty professionals, can only be bought in larger product sizes. This is because Alexami’s founder, Alenka Dirnbek, claims that excess packaging is both bad for the environment and misleading for consumers.

So what is product shrinkage, otherwise known as ‘packaging shrink’? It’s when a product’s contents get smaller, yet the packaging size and price remains the same. It’s becoming more commonplace as things like commodity prices, freight and production costs have climbed. Rather than pass on another price hike to customers, some companies opt to reduce product volume, yet this can be misleading for consumers because the actual size of the packaging may look the same, yet the content’s weight has been reduced.

In Australia, widespread customer backlash has occurred when popular brands of chocolate and beer have gone under the ‘grocery shrink ray’. But price per volume comparison is becoming easier in supermarkets thanks to the recent introduction of mandatory unit pricing, which is the display of product cost according to weight or other measurements, such as cost per sheet of toilet paper, to enable customers to more easily compare different sizes of the same product type.

Yet for goods not sold in supermarkets, no such mandatory laws yet exist. This makes it increasingly hard for consumers, and also poses challenges for environmentally and socially conscious brands like Alexami Cosmetics that strive to offer a larger quantity of quality product at what may outwardly seem like a higher price.

For example, Alexami’s signature product, a professional grade natural mineral foundation powder, bronzer and setting powder is 20g Net Wt, more than double the standard size of 8g and an astounding five times bigger that the increasingly common 4g product size. When Alexami Cosmetics initially began approaching its core target market of beauty salons and professional makeup artists to distribute the product, some expressed concerned about product pricing. Comparable products from other manufacturers seem cheaper when the packaging is compared side by side, when in reality the Alexami product is up to 60% lower in price when the price per unit volume ratio is evaluated.

As cosmetics sold outside supermarkets are not subject to mandatory unit pricing, it is up to consumers to do their homework. “It’s becoming more common for people to check labels to avoid toxic ingredients, so we’d also like to urge consumers to compare product sizing while they are shopping too,” said Dirnbek.

Alexami’s efforts to reduce packaging are just one factor that the brand has considered to become an environmentally sound choice. “All our packaging and marketing materials are printed with soy ink on recycled paper using 100% waterless print technology, we also offer product refills and larger product volume sizes to cut back on unnecessary packaging waste, and we use renewable bamboo and synthetic hair for our cosmetic brushes which makes our products cruelty-free and eco-friendly. Our aim is to give customers better value for money and help the environment by cutting back on things like extra jars, boxes, and labels,” said Dirnbek. It’s a practice she would like to see more companies adopt. “These measures also save on labour cost, and by offering refills and great value products, you will attract loyal customers as well.”

This forward thinking way of doing business is also backed up by research. Recognizing the relationship between consumer confidence and purchase behavior, a Nielsen Panel Views study in America conducted an analysis of 47,000 people across 36 product categories. The study established that decisions by manufacturers to shrink product sizes in order to prevent price hikes have overwhelmingly disappointed consumers, who instead seek larger package sizes with lower cost per unit weight.

The study also discovered product shrinkage shaved as much as 15-20% off product size, like 12 ounce bags (about 340 grams) of potato chips that had been scaled back to 10 ounces (about 280 grams), without a subsequent drop in retail price. Chocolate, breakfast cereal and personal products were the other main categories undergoing widespread product shrinkage.

As most of this product downsizing is done without public announcement, Alexami’s Dirnbek points out the only thing that consumers can do is be more wary of checking product sizing when purchasing, and support products that offer the best value to quality ratio. “When shopping I am always checking grams and ingredients. Price is not necessarily always what it seems. I want value, but I also want quality of course. Consumers need to check that only the best quality ingredients have been used too, because we’d all rather pay once than twice. If you buy something cheap and it doesn’t work, you then have to go back and buy better quality to replace it. So you pay twice and waste twice as much time. It’s better to do homework, research the content, look at weight, read descriptions and labels and make a choice based on quality and value for money.”

The entire Alexami range of professional grade natural mineral make up and cosmetics offer great value and are available exclusively through select stockists across Australia. Worldwide release dates are being scheduled for late 2010. For more information visit http://www.alexami.com

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Alenka Dirnbek
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