My first job in marketing was as Croft sherry brand manager for IDV. I remember then, an older and wiser colleague telling me that a brand’s packaging is its first ad. Its identity and shelf appeal is critical to its success as it is often the first contact with the consumer. This has certainly struck a chord recently. I have observed that few of my former marketing colleagues are giving their brand’s packaging identity sufficient attention in food and drinks markets.
In recent years the supermarkets’ own-brand products have emulated their branded competitors, dressing their products up in the brands’ clothes, undercutting on price and thereby stealing market share. The brands’ defence has been to resort to litigation or to beef up the ad spend to enhance the brands’ inherent imagery.
However, this takes time to take effect and brand share can be eroded in a short space of time if consumers are happy to transfer their allegiance. According to Whitbread director of take-home sales John Ricketts, four out of ten shoppers don’t know what brand they will buy when they go into a store.
However, it is simply not enough to deliver “copycat” packaging to steal share from brands. The aggressive competition between the retailers themselves has forced their marketing departments to go one step further, making continuous innovation a watch word. This has been applied with success in many areas and packaging in store is no exception.
As a result, supermarket brands are innovating ahead of their fmcg equivalents. They are fighting hard to build their own distinctive identities to expand their consumer franchise. And it appears to be bearing fruit as “own-brand” sales in Sainsbury’s and Tesco are now alleged to exceed 50 per cent of their revenues.
Innovation is particularly evident at the premium end of the market. Tesco recently launched its exclusive Finest Range of gourmet meals, with silver and black livery to compete with Marks & Spencer. Sainsbury’s has responded with its Fresh Creations range.
These initiatives are building on the growth in the chilled ready-meal sector already dominated by the supermarkets’ own-brands where linear metres are given over to exotic ethnic foods commanding premium prices, presented in attractive and appetising packaging formats. Branded ready meals are barely in evidence.
Sainsbury’s seems to have excelled at introducing innovative packaging formats which have a positive impact on sales and margins. It has done this without compromising its presentation, rather than the converse.
Throughout its stores you will now find products in packaging with arresting illustrations and quality typography.
One example recently quoted was the launch of the Ready to Eat Dried Fruits range presented in a six-colour, gravure-printed metallised polyester stand-up pouch with a resealable zip. Sainsbury’s claims that this new packaging has transformed perceptions about the quality of the product and sales have grown by 50 per cent accordingly.
Safeway likewise is no longer content to plagiarise brands’ packaging solutions. It is developing brands of its own with a strong focus on quality cues in all its packaging. Recent successes have included its range of tonic waters which, prior to repackaging, lacked appeal compared with brand leader Schweppes.
The new range has the kind of detailed and crafted design language found on the very best beverages, reflecting the product’s heritage as a perfect accompaniment to gin and vodka. Other successes for Safeway include its flavoured waters.
At its most basic, the wave the supermarkets are riding is one that merits real focus from marketers. Consumers are more experimental and more demanding today. They are besieged by a plethora of choices every time they shop.
If marketers wish to increase the popularity of their brands the presentation and therefore packaging must be distinctive and attention-grabbing.
Effective packaging has a greater chance of influencing a purchasing decision than many other aspects of the marketing tool kit, but it is often given less time, focus and financial investment than advertising or promotions.
Great packaging can actually help leverage investment in these other areas if it is given consideration at the heart of the mix. One example is the Carling Black Label redesign in support of Carling’s FA Premiership sponsorship. This arresting and propositional design helped increase Carling’s sales by 39 per cent in a highly competitive beer market.
While this example may not be current, the learning still holds true. In some recent research conducted for Whitbread, it was confirmed that packaging design is seen to be crucial to the success of beer brands.
“[Shoppers] want to make a quick decision, and they are looking for a quality brand, so good design plays a huge role in shaping their purchasing decision,” says Ricketts at Whitbread.
While many brands have the potential to reinforce their marketing effort through innovative packaging, few in my experience actually exploit the opportunity.
Furthermore, retailers are less able to take advantage of these activities for their own brands, so it is one way the marketers can regain the initiative. However, it needs to be given serious consideration as a key element within the marketing mix, coupled with the financial investment necessary for success.