Packaging Design as Brand Differentiator

A negative aspect associated with product packaging is environmental impact. Landfills receive tons of paper, cardboard, plastic, styrofoam, and other materials discarded after products are opened or used. Consumers are called on to be more environmentally conscious; product makers bear the same responsibility.

Pepsico’s Frito-Lay brand hopefully is an example of a future trend in packaging. Frito-Lay’s SunChips brand will soon roll out a compostable package. The package will be 100% bio-degradeable. Frito-Lay’s choice of SunChips as the brand to debut an environmentally friendly package is appropriate. SunChips is positioned as a healthier alternative to potato chips. Using “healthier” packaging for SunChips is a great fit.

I bought a piece of furniture recently and cringed as I filled my garbage can with sryrofoam and bubble wrap. Kudos to Frito-Lay for taking the initiative to develop packaging that has less of a negative impact on our environment. It is the right thing to do, and environmentally responsible packaging can be leveraged as a point of difference to set you apart from competitors.

Link: Marketing Daily – “Sun Chips Rolling Out Compostable Packaging”

Oatmeal: The Next Battleground in Food Marketing

Successful product launches are wonderful. Since 80-90% of new products fail, a successful product is not only a welcome change from the norm, it is essential for a business’ survival and growth. The only problem is that successful products tend to draw attention… and imitators. Such is the case for Starbucks. It rolled out instant oatmeal in its stores, quickly becoming the company’s most successful food product launch ever.

Now, Jamba Juice is looking to get in on the oatmeal action. The company has been testing oatmeal in its Chicago stores and plans a full rollout in January. The product is not an imitation in that it is slow cooked and touted as “steel cut” oatmeal (steel cut as opposed to “plastic cut” or “paper cut”?). Jamba Juice is counting on consumers perceiving a quality difference between its preparation method and that of Starbucks.

The need to differentiate is key in any product launch, especially when you are a follower rather than a leader. Without a distinct point of difference, Jamba Juice will come off as a “me too” player with its oatmeal offering. A potential payoff for Jamba Juice is that oatmeal might attract customers to its stores during a daypart that has less traffic. It is a shrewd move to grow business by attracting customers at a time of day when there is excess capacity.

Link: Ad Age – “Jamba Juice Launches Volley in New Oatmeal War”

Xbox 360’s 50-Cent Flaw

A lawsuit brought against Microsoft by an Illinois man claims his Xbox 360 console scratched three different games when the console was switched from a vertical to horizontal position during game play. While I am wondering why someone would want to change the position of his or her game console while playing a game, I am also wondering why Microsoft did not take steps to prevent the problem. According to testimony from a Microsoft program manager, this problem with Xbox 360 was detected before the product launched in 2005. Apparently, the problem could have been corrected with minor modifications to product design that would have cost as little as 50 cents per unit.

Maybe Microsoft was thinking like me, questioning who would move around their consoles while playing games. It is an issue because a product feature touted for Xbox 360 is the ability of the console to operate with either a vertical or horizontal orientation. While changing the orientation during game play may not be ideal, engineering the product to hold up to such a change is essential. While some people might think this matter is trivial in the grand scheme of things because we are not talking about a life or death consequence, it is a matter of maintaining brand integrity. If a company knows about potential problems with a product before it hits the market, it should proactively take steps to deal with the problems. If not, be prepared to suffer hits to brand reputation as Microsoft may experience yet again with Xbox 360.

Link: Yahoo! – “Microsoft Faces New Xbox 360 Reliability Accusations”

When Less is… Well, Less

Weak economic conditions often put marketers in a situation of either raising prices or holding down costs. A common tactic for consumer packaged goods marketers is to do the latter, reducing the weight or quantity of a product item to reduce cost of goods sold. This route is almost unavoidable as these products are often discretionary purchases (e.g., snack foods or candy) that consumers may stop making if prices rise.

The Wm. Wrigley Company is opting for holding price and reducing product in its upcoming “Slim Pack” launch of its well known chewing gum brands. This approach carries with it risk in that consumers may see through the reduced offering and view it the same as a price increase. Even worse, such a move may be seen as a deceptive ploy to maintain profits at customers’ expense. A comment by Wrigley’s VP of North American consumer market- gum, reflects either important insight gleaned from market research or wishful thinking. He said, “To them the value goes up because they’re getting a better tasting product in a better package. Price is not the way the consumer is looking at this.” For the sake of Wrigley, I hope it is the former, not the latter. Link

Sony Ensures History Doesn’t Repeat

The white flag has been waved in the battle for high definition DVD supremacy. Toshiba and Sony have been locked in a fierce fight to have their competing technologies become the industry standard in this category. Yesterday, Toshiba announced that it would end production of its HD-DVD products and exit the market within a couple of months. This decision in effect makes Sony’s Blu-ray technology the industry standard.

The news could not have been better for Sony. The company has been seeking to regain the success it experienced in the 1980s and 1990s. More importantly, Sony was able to avoid a repeat of history as it had experienced two major defeats in technology platform wars in the past. First, Sony lost the video cassette player war in the 1980s as the industry adopted the VHS format over Sony’s Betamax. Second, Sony’s effort in the digital music download business was thwarted by the dominance of Apple.

So what was the difference in the case of high definition DVD? Sony developed vital relationships with content providers (e.g., movie studios) and retailers. With support from key players such as Disney and Warner Brothers on the production side and Best Buy and Netflix on the distribution side, Sony created a competitive advantage Toshiba realized it could not overcome. The best products and best technologies are great to have if you can produce them, but if key channel partners do not buy in to your offering you have little chance of realizing your full potential in the marketplace. Sony now has both the product and channel support. Link

The Changing Role of Packaging

Product packaging has evolved in its role in marketing strategy. For many years, packaging received little, if any consideration as part of the product. It merely provided a storage function. Then, when marketers understood that brand associations related to packaging are held by consumers. Thus, packaging became part of brand building efforts, with notable examples being Coke’s contour bottle and Apple’s all-in-one iMac.

Today, packaging takes on an even more prominent role and can actually be a point of differentiation. Packaging can enable product use in different situations (e.g., Yoplait’s Go-GURT), product easier to use (e.g., Heinz ketchup in bottles designed for refrigerator doors), or shape a brand image that can command a price premium (Apple iPod and iPhone). In the future, product packaging will take on greater significance for what it does not do… waste natural resources. Concern about protecting the environment has spurred a call for coming up with ways to reduce the amount of materials used in product packaging. Wal-Mart has a Packaging Scorecard initiative that assesses its suppliers efforts to reduce packaging waste.

Focusing on packaging can not result in a successful marketing outcome, it is the socially responsible thing to do!

Nintendo’s Worthy Award

Advertising Age magazine has named Nintendo as its 2007 “Marketer of the Year.” Nintendo got the nod over Apple, Nike, Al Gore, Geico, and Unilever. The recognition is for Nintendo’s efforts in bringing its Wii gaming system to market last November. In that time, Wii has become the market leader in video game consoles. Nintendo’s competitors, Microsoft’s Xbox and Sony’s PlayStation 3, may have more technically advanced systems, but consumers young and old have taken to Nintendo’s easy-to-use system.

The message behind Nintendo’s recognition as Marketer of the Year is simple. Products that can engage their users through designs that make the product easy to use or operate add value that may be hard for competitors to duplicate. Unfortunately, not every product maker can expect users to have as much fun consuming their products as Ninteno Wii players experience. The good news is not every product we use has to provide us with fun or pleasure, but we value products that aren’t a source of stress! Simplicity in acquisition and use of a product is a way to add value, one that can even lead to winning Marketer of the Year!