No Tricks, Just Trust: Using Loyalty to Treat Hiddenflation
Shoppers aren't just facing crowded stores and long wish lists this holiday season.
They're also up against something more insidious: Hiddenflation.
From shrinkflation to surprise surcharges, rising costs are quietly eroding consumer trust. Retailers may not be able to control supply chain pressures, tariffs or rising prices, but they can control how they respond. Loyalty and personalization strategies are powerful tools to offset frustrations, rebuild goodwill and reinforce value at a time when it matters most.
When Hidden Costs Break Trust
Consumers are savvy. They notice when a candy bag holds fewer pieces, when fees appear at checkout or when perks quietly disappear. In fact, 68% of consumers report noticing shrinkflation across major product categories, especially in snack foods.
And they don't just notice — they act. Many say they'll stop purchasing, switch brands, buy generics or shop in bulk.
Hiddenflation isn't limited to groceries. According to Epsilon research, 61% of consumers worry about tariffs impacting product prices, even during lighthearted moments like Halloween. The message is clear: scrutiny is intensifying, and hiddenflation doesn't just squeeze wallets — it chips away at the emotional bond between shopper and brand. If left unaddressed, it risks breaking loyalty at the very moment brands need it most.
Loyalty as a Counterbalance
The good news: Brands aren't powerless. Loyalty programs, perks and personalized experiences can soften the sting of hiddenflation by making consumers feel recognized and rewarded. Instead of defaulting to deep discounts — the classic race to the bottom — brands can strategically deploy rewards that reinforce value without eroding margins.
Generational differences offer a clear example. Millennials significantly outspend other cohorts on celebratory moments, with average Halloween spend hitting $361 compared to $125 for boomers. What’s more, 47% of millennials say they’re willing to invest heavily in decorations and costumes, far outpacing older shoppers, according to Epsilon research. These insights reveal exactly where loyalty perks can do the most good: Stretching budgets in the categories that matter most to each audience.
Strategies That Work
- Be transparent. Shoppers don’t expect retailers to solve inflation, but they do expect honesty. Clear messaging about rising costs, paired with visible loyalty rewards, shows you’re sharing the burden rather than hiding behind fine print.
- Add value creatively. A well-timed bonus, gift-with-purchase or bundled seasonal package can turn a transaction into a moment of appreciation. These perks often cost less than broad discounts yet carry significant emotional weight.
- Personalize with data. Loyalty isn't one-size-fits-all. A family shopping early for costumes will value different perks than a Millennial splurging on decor. Recognizing customers across channels and tailoring offers accordingly demonstrates understanding and inspires engagement. For example, doubling points on party supplies for frequent buyers shows recognition and fuels ongoing loyalty.
- Expand through partnerships. Collaborations with complementary brands can deliver perks or experiences no single retailer can provide on its own. Shared value broadens your offering while lowering individual cost and embedding your brand deeper into a customer's lifestyle.
- Meet consumers where they shop. Epsilon research shows consumers still lean heavily on in-store shopping for perishable holiday items, while relying on online channels for decor and costumes.
Well-executed loyalty programs don't just deliver perks — they deliver consistency. Ensuring rewards travel with shoppers, whether they’re filling a cart online or browsing a store aisle, reinforces value and creates a seamless experience that deepens connection.
From Trust Breaker to Trust Builder
Hiddenflation is real, and it's not going away anytime soon. But it doesn't have to mean hidden disappointment. Retailers that use personalization and loyalty-driven perks can turn a moment of friction into an opportunity for connection. By offering meaningful value — not just in dollars, but in recognition and relevance — brands can transform hiddenflation from a trust breaker into a trust builder.
In today's environment, where every purchase decision is weighed more carefully, loyalty is no longer just a program. It's a promise. And for brands that keep it, the rewards will last well beyond the holiday season.
