Why Packaging Matters More than Ever

Marketing researchers of note, Forrester Research and McKinsey & Company, recently conducted studies on the nature of consumerism today. Their results are important because they point to a shift away from the classic “consumer purchasing funnel.”

This classic marketing theory holds that consumers develop awareness of branded products thanks to numerous, traditional advertising impressions. Familiarity leads to eventual purchasing consideration for a limited choice of brands. When entering a retail environment, consumers center their attention on those few choices, and purchase one. Throughout the process, the funnel obviously keeps narrowing. With consistent delivery on the brand promise, loyalty develops over time.

However, new research demonstrates consumer purchasing patterns no longer fit this model. So could the wrong marketing emphasis be one of the reasons, along with a soft economy, for real shifts in consumer spending and overall loyalty? Given the data, it’s likely.

According to the latest consumer research, there’s a new paradigm. Constant exposure via traditional and interactive media continues to create brand awareness. When consumers make the decision to purchase a product, they evaluate their choices by conducting Internet research. They participate in word of mouth (WOM) exchanges, seeking information from social media contacts.

This is a crucial juncture for brands in the pre-purchasing process—the reason they must have a strong online presence. Marketers need to invest dollars in independent websites—not only their own—that they’ve identified as the places consumers are seeking information about products like theirs, and buying them. Ditto for interactive media sites—online and mobile—since these core constituencies will endorse and spread the word about their products.

Due to a virtual explosion of social media outlets as well as new brands, consumers are actually not narrowing their options. Rather, they are expanding their possible list of choices, which makes the narrowing consumer funnel model obsolete.

Marketing in the New Paradigm
Armed with this information, why would product companies execute the usual old budget cuts when consumer spending slows down? If the consumer has fundamentally changed, doesn’t this call for a serious restructuring of marketing focus, initiatives, spending?

Consumers are no longer passive, so spending the lion’s share of the marketing budget on TV, radio, newspaper and magazine ads simply isn’t efficient. Yet when the economy sours, marketers pull back and retrench to “tried and true” traditional outlets. They cut new media spending. They cut customer service personnel. They hold off on new product packaging. These might seem like natural decisions, but do they make sense?

Many companies have dabbled in interactive media in a limited way—not always meaningfully or for long—so they have little ROI data on their marketing efforts. As a result, they’re likely to be cut down or cut out. This is a mistake. While one-way communication still delivers impressions, today’s consumer is empowered by information gleaned from the Internet, mobile devices and conversations on social media sites. They pursue online connections to family, friends and blogging communities. These new media influencers have increased in importance since the last economic downturn. So, logically speaking, does it make sense to make deep budget cuts here?

Let’s not forget that consumers also converse directly with companies via customer service online, phone and email. Here is an often under-mined opportunity to interface directly with consumers—a golden opportunity to rectify problems, address issues quickly and satisfactorily, tweak product features and find out what consumers respond to best when purchasing category products. So should customer service be the recipient of deep budget cuts?

Lastly, with brand loyalty flagging as consumers scour retail shelves before making their final purchase decisions, how can deep budget cuts on packaging be justified?

Instead, why not work smarter and get more from fewer resources? Cutting back on traditional marketing to some degree and reallocating resources to social media, websites and customer service makes sense. Reallocating resources on packaging is vital since final purchase decisions are made at the retail shelf. Aligning marketing communications among all of these consumer-facing initiatives is priority number one.

Packaging for the New Paradigm
The current diminishing loyalty from consumers open to more choices can work to the benefit of a brand, or to its detriment. Smart marketers will use this knowledge to address their presence at retail. Packaging has actually gained in importance in the marketing mix as consumers closely scrutinize more products on the retail shelf before purchasing. Given this, it’s a wise idea to conduct an assessment of current packaging and make needed changes.

Packaging has to deliver more than ever in the current economic and competitive environment. If it doesn’t decisively refer back to the brand, doesn’t quickly and simply communicate its value and preferability to consumers, doesn’t definitively leverage the brand’s and product’s key assets, it fails to win the consumer’s vote to purchase the product. It’s vitally important to make sure one simple, overriding message resonates on packaging. Why? According to research, the average consumer scans the retail shelf in 20 seconds or less.

So what’s most important to communicate in that span of time? It’s critical to tap into consumers’ compelling reasons to choose one brand over the rest in a category by honing in on consumer statements and conversations, WOM and interactive media comments. How about leveraging that most relevant thing—that one overriding message consumers themselves care most about—as the lead package communication?

Ultimately, packaging has the power to affect consumer purchasing behavior if utilized correctly. If packaging isn’t a huge asset in selling the product and brand on the retail shelf, it simply isn’t being maximized as a marketing tool. Now, while consumers are clearly open to more brands than ever, there’s a chance to win more business and potentially more brand loyalty when the economy improves.

So here are the questions that must be answered now: How can marketing initiatives be used to get closer to consumers and better understand their needs? How can two-way communications be used to increase brands’ relevance to the consumer? How can aligned messaging be utilized for all consumer-facing marketing initiatives? Lastly, how can all of this help produce the most compelling packaging in the category?

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Ted Mininni is president of Design Force Inc., the leading brand design consultancy to consumer product companies with Enjoyment Brands™. Design Force helps clients market brands that deliver positive, gratifying experiences by connecting consumers to brands emotionally with compelling visual brand experiences. Design Force, Inc. can be reached at 856-810-2277, or online at www.designforceinc.com.

This article was sourced at www.brandchannel.com

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