The power of pack structure to beat the squeeze
Just as mainstream supermarkets in the UK, such as Tesco and Sainsbury’s are being eaten away from either end by the more premium and budget, this same battle is being played out on shelf within the retailers walls. Consumer brands are feeling these pressures as emerging premium offers stay ahead of the curve and budget own label uses design to become more desirable.
At the Premium end, a multitude of new brands target niche gaps in the market with propositions that appeal locally and to a new wave of gen-z consumers. Jealous Sweets and Candy Kittens spotted the opportunity for a successful premium candy that the likes of confectionary giant, Mondelez, failed to grasp. The ones that take hold nibble away at the mainstream brands and collectively they can be very damaging. It was amazing to see how an eclectic collection of craft ale entrepreneurs pushed huge lager brands off the end of the shelf with their maverick attitudes and engagement in store.
It is difficult for established brands to take risks and react quickly to market opportunities and competitive threats, but it is essential to stay relevant. Look how long it took Schweppes to respond to Fever Tree entering the mixer category. While Fever Tree grew their consumer base Schweppes looked tired and dated. By the time Schweppes were able to respond with a design refresh it was too late and they’d been allowed to grow into significant competition.
With a relentless squeeze on margin, budgets have to be cut somewhere. Investment in new pack structures is seen as an easy start point. They are seen as expensive, time consuming and often fraught with unforeseen complications. This view is compounded when exciting new brands come into the market with a plethora of stock bottles and pouches. However, this is a false economy, especially for famous household brands with heritage that need to stay relevant and iconic.
At the start of their ventures, new-to-market brands don't worry about pack structures. By default, they will have new propositions, and fresh provocative identities to disrupt the category and attract new consumers. However, for iconic brands that are rich with heritage but that also need to remain relevant, bespoke physical pack structures provide the perfect opportunity to create the defining visual codes of a category. Importantly, own-able structure can allow these brands to remain the leader through a better user experience with which entrepreneurs and retailers often can't compete. Danone’s Aptamil and Cow & Gate infant formula milk powder pack is one such design. Significant investment in a useable pack has paid off with a design that, with various improvements, has been in the market for 15 years without any real comparison on shelf. The considered moments of delight for the user, for example the 'one hand scoop leveller' significantly helped the brand consistently be seen as the category leader.
Lynx/ Axe were well known for their annual new fragrance launches, but what they found was that, while consumers were drawn to the new product, existing products did not see much uplift. With all the effort going into developing and marketing extensions the problem is the core by contrast can look unexciting, unloved and under-valued. New pack designs can revitalise the core, making these extensions work much harder.
Keeping the graphic design up to date is clearly vitally important and generates differentiation from own label, but is often surpassed by new exciting brand identities, so it cannot be totally relied on. New structures on the other hand are difficult for either the own label and niche premium brands to achieve at the quality, speed of rotation or feature level that mainstream brands can. When done well they really set the famous household brands apart as leaders through iconic structural equities and better, more delightful user experience.
Integrating the graphic design with structure can further protect the graphic design from being copied as the integrated form will be very difficult to replicate and will also provide a more dramatic impact on shelf than any simple wrap round label. When it comes to packaging design, to really be the leader you must consider form - as well the graphics its dressed in!