It is to encourage you not to buy so much so that you can re-use the packaging to send stuff to other people.
In the case of one of my recent purchases, a pair of G Gauge flat cars, each is packed in a polystyrene two part moulding which is good for protection both during transit and also during my ownership ... but what set me back was the one inch foam sheets which surrounded the pair of boxes .... been wondering what I can use them for ... too good to throw out and they do not come under the list of re-cyclables listed by my local council.
The outside packaging obviously was done in China where they were made .... shipped to the States ... and then back across the Pacific to me.
Maybe it is to make the purchaser think that they are getting more for their money, big packaging=big value, branding, packaging and advertising are all very pyscholoigcal and industry is very good at it.
Actually, It's a kinda brand value of particular product. You may noted that a big and well known brand will provide such packaging for their products.
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Re: And we complain about landfill
It depends. Those packages are made to hang on pegs, for the customer to pick and pay at the cashier's. A smaller pack might be more likely to escape the shop unpaid. I bought an original battery for my OM-D in Miami recently, and it came in a small box, only slightly larger than a matchbox. It was 64 dollars. I understand that they won't hang those on a rack in such a small pack. It is even more obfious if you buy a memory card. A micro SD might come in a plastic pack the same siqe as that battery. Some of them have a large cardboard backing glued to a similar front with a hole for the blister containing the product, All glued together and needing a heavy duty pair of scissors to open.
The reason for the size is to minimise theft, and perhaps to a minor degree to have the items stay in the basket and not fall through the slots in it while walking around in the shop.