Empowered packaging - adding value across the brand life-cycle
These are exciting times for those of us who work in the packaging space of the global FMCG community. GfK have spent a great deal of time analysing the market and some of the highlights follow.
In recent years, we've finally seen the role of our discipline begin to receive some of the recognition that we, naturally, believe it deserves. Just going into a store presents the opportunity to be visually assaulted by the amazing diversity of packaging structures and graphics on display. Not just that - we are also seeing entirely new levels of innovation and imagination in the form of vibrant, iconic colours, shapes and other proprietary elements. Brand owners recognise the commercial power of investing in the physical manifestation of their brands' personalities.
Causes for optimism
But, just at the moment when we're sensing new causes for optimism, other parallel forces are threatening to return us to the bad old days. There is a danger that packaging is once again under threat of relegation to a low-value manufacturing function. In the wake of industry consolidation, cost-cutting is sweeping across the consumer packaged goods landscape. And what's more, adherence to restrictive (and creatively destructive) zero-based budgeting accounting practices is becoming more prevalent.
What this means is simple - that it's tempting for marketers to play safe and fall back exclusively on the long-established principles of the 'first moment of truth' (FMOT). These principles hold that a product's packaging is just the final output of a longer 'funnel' in which activities like advertising, direct mail, and now social media, grab far more marketing attention, budget and commitment.
Building positive imagery
The reality is that the FMOT stand-point was developed around half a century ago in a very different era - one when the crowded in-store shelf really was the first point of direct contact between a brand and the consumer... in other words, when a brand had just a few short seconds to stand out, engage and communicate.
In those days the theory was both clear and highly appropriate. Marketers had to do whatever needed to be done to prepare the consumer for that moment by first building a wealth of positive imagery around the brand.
Where is the first moment of truth?
The FMOT is still important. But today it's just one interaction among the many that consumers have with brands. And it's now impossible to defend the notion that the shelf is still the first - or even the truest - point of contact. It's also extremely difficult to identify where those points actually are: when writing or updating an online shopping list? When receiving a home delivery?
The reality is that consumers are increasingly tending to live perpetual, holistic and 'circular' brand relationships. This makes the idea of focusing on a few seconds of on-shelf presence completely redundant.
Digital disruption
Two factors are particularly important: first, the plethora of retail channels is still disrupting the buying journey as shoppers jump between online and physical, with digital being particularly influential during the discovery phase. In fact, a full 57% of consumers have already made their purchase decisions before even entering a store and some categories are projected to hit 30% digital penetration by 2018.
Second, consumer habits are far harder to categorise and segment. Consider the growing power of the more diverse and educated shopper: one that thinks nothing of visiting an upmarket boutique, hunting for charity shop bargains, and roaming a speciality food-store, all while on the way home to order basic provisions online.
All this adds up to an increasingly complex and multi-faceted relationship between brand and consumer. Restricting the communications role of packaging to a few short on-shelf seconds misses valuable opportunities to add value throughout the entire packaging life-cycle.
From eye-catcher to asset
This evolved relationship between brand and consumer means there is a significant - and largely unleveraged - opportunity to invest in packaging with considerably more influence in the consumer relationship, moving it from simply an aesthetic eye-catcher to a valuable corporate asset. This involves recognising and empowering it as a key brand touchpoint and ambassador at every stage of its journey, Starting from concept, moving onto design and creation, through distribution, shelf, home (or office, car or pocket) to final disposal and replacement.
It's an interesting and challenging area, and one that we at GfK have gained a great deal of satisfaction from addressing and resolving. For information join our webinar here.
