Posted by: Anthem Worldwide | Date added: Mon 30 Mar 2009
In this month's column, Barry Seal, Managing Director - UK at strategic design agency Anthem Worldwide, talks about the importance of good packaging design to create real differentiation on-shelf. But if you want maximum impact, don't use it in isolation.
By Barry Seal, Managing Director – UK of Anthem Worldwide
There’s no doubt that, as the recession continues to bite, consumers are trading down and buying cheaper products. Clear evidence of this can be seen in the fact that discount grocery retailers Aldi and Lidl are enjoying double-digit growth, swiftly gaining market share from their higher priced competitors. Similarly, recent research compiled by Empathy Research shows that four out of ten shoppers have swapped popular brands for cheaper own label products. So, as purse strings continue to tighten, it must be tempting for brands to cut price in order to compete – but this is a dangerous strategy to pursue.
For big brands, entering a price war is unsustainable for the long term. A company may make quick wins initially, but it will encounter major problems over time. Firstly, retailers will always be more powerful than manufacturers. Their massive buying power ensures their ability to put on shelf own label products that are cheaper than brands – fighting them on price is a battle a brand is unlikely to win. Secondly, if a brand competes on price alone, it essentially becomes a commodity. Its lack of brand equity and differentiation gives consumers no reason to choose it, over and above own label, or any other cheaper brand.
All of this means that brands need to focus squarely on what sets them apart from the marketplace – and using packaging design to deliver this message is essential in the success of any brand. It’s worth remembering that 70% of purchase decisions are made at point of purchase.
Packaging is what brings a brand to life. It is one of the most important parts of the media mix and provides brands with the final opportunity to dramatise their core USPs, create a connection and make people pick up the pack. Not only that, but it keeps replaying brand messages 24 hours a day in people’s homes.
We all know the expression that “people buy people” – it’s certainly true in marketing circles. Well, the same can be said for groceries. There will always be people who buy on price, but there will also be a significant number of people who buy on brand ‘personality’ – as personified through its packaging.
It should therefore come as no surprise that sales of Heinz Baked Beanz soared 21% in the three months to the end of January. At times like these, many consumers like to buy into the reassurance and performance of brands they know and trust, rather than taking a risk with their spend. With distinctive packaging that embodies the brand’s message of ‘good food every day’, Heinz is reaching out to its customers and providing them with reasons to keep buying its brand. Interestingly, to combat the threat of own label, it has also launched smaller packs at lower price points so people are still able to buy the brand, even if they’re cutting back their spend.
However, packaging should not be viewed in isolation. Brands need to make every pound of their marketing budget work harder than ever – which means creating a unified communications strategy that works across all elements of the marketing mix. By clarifying the role of each element in a campaign, you can ensure that each one is impressive in its own right. But together they build an even more persuasive brand story that leverages maximum return on investment. At Anthem we have found that working in this way with clients – creating consistent and compelling brand experiences at every touchpoint – is an increasingly interesting proposition for clients. Who doesn’t want a bigger bang from their buck?
Importantly, to achieve this, packaging therefore needs to be placed firmly into the overall planning process right from the start. Without doing this it becomes an after-thought, making it difficult to fulfil its full potential. With shoppers today being faced with 40,000 different packs in the average supermarket, that’s a risk that brands can ill afford to take.
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