How CPG Brands are Strategizing for the Gig Economy

The major disruption caused by platforms of the new gig economy (ie. Uber, AirBnB, Etsy) has been widely reported, and it’s still too early to fully understand the long-term implications that it will have for relevant industries. Robert Reich, former labor secretary, called the shift “the biggest change in the American workforce in over a century” and reaffirmed its unpredictability. What we do know is that these sorts of platforms are impacting increasingly diverse fields, and that companies are facing the prospect of either conforming or becoming obsolete. After several years of the gig economy going strong, CPG brands are finally responding and catching up.

 

 

In mid-May, Mars began recruiting event hosts for a new multilevel marketing campaign called “The Cocoa Exchange”. In the vein of Avon or Mary Kay, “curators” buy kits of samples to push at parties, and are awarded a percentage of any online sales that result from it. Mars has collaborated with chefs to create a unique line of products specifically for The Cocoa Exchange, meant to pair well with wine and suit a party atmosphere better than the company’s existing options.

 

Direct selling like this, Mars has said, has been a fairly safe and profitable channel for the past five or six decades. Additionally, this strategy plays into two well-documented facets of millennial economic behavior – first, the “obvious demand” (as Mars put it) for opportunities to earn supplemental income, and second, millennials’ propensity to invest more in experiences than in material goods. These factors combined convinced Mars that an interactive, entrepreneurial program like The Cocoa Exchange would be able to thrive.

 

 

Other companies are taking inspiration directly from popular digital platforms. Deliv, for instance, is a five-year-old startup that works with major retailers to deliver in-store purchases directly to customers using crowdsourced labor. Known as “Uber for the retail industry”, Deliv has managed to avoid the turbulent legal environment that rideshare services have faced because they don’t compete with regulated industries, unlike Uber and Lyft, which have been accused of threatening taxi services. Deliv has enabled companies like Williams-Sonoma and Bloomingdale’s to offer an added-value service to their consumers and aide in competing against companies that deal primarily in e-commerce, for whom home delivery is a major selling point.

 

 

Some retailers – like Macy’s – are collaborating with gig platforms to offer new experiences to a shared consumer base. Last year the Herald Square Macy’s (the company’s NYC flagship store) hosted a pop-up Etsy shop in an area of the store known as “One Below”, a section meant to appeal to millennial shoppers. At any given time, the shop featured around fifty products (including things like household goods and jewelry, which Macy’s also sells) that were constantly rotated out in order to conform to a specific theme. Prior to working with Macy’s, Etsy also collaborated on smaller projects with retailers like Nordstrom and Whole Foods.

 

Another strategy that CPG brands are taking on is challenging gig platforms for talent. According to an article published this month by the London School of Economics, self-employment is increasingly common among those who traditionally have a difficult time transitioning back into the workforce, namely stay-at-home parents and retirees. In order to retain skilled workers and prevent flexible gig platforms from absorbing these types of candidates, many CPG companies are implementing return-to-work programs. Pepsico has been a leader in this with their “Ready to Return” initiative, which accepts professionals who have taken a career break for more than two years and provides them with ten paid weeks of coaching and mentoring before they start their new position. On their career site, Pepsico tellingly specifies that they are seeking associates who can “make an impact in the Age of Disruption”.

 

Economists and commentators also refer to the gig economy as the “on-demand” economy, especially when discussing it from a consumer behavior perspective. Similar to the concept of “McDonaldization” that was so popular a few years ago, the idea now is that companies like Uber are conditioning users to expect quick and easy service from completely unrelated industries. Amazon is also largely responsible for the on-demand economy, and big box stores are strategizing for how to compete. For example, Wal-mart just opened their first automated 24-hour pickup kiosk, which allows customers to place online orders (of at least $30) and pick them up at a designated kiosk in-store. Last year, they directly partnered with Uber and Lyft for a home delivery pilot program, comparable to what Deliv currently offers. Now with Amazon’s startling announcement that they have decided to purchase Whole Foods, retailers are feeling the heat more than ever, and we should expect to see even bolder experiments from unsettled competitors.

 

 

In an article for Food Dive, industry reporter Keith Loria warned against transitioning to independent contractor-based hiring practices, as some food companies may be tempted to do. After all, companies like Uber don’t have to pay for employee benefits, nor do they have to pay for downtime. However, Loria said, the food manufacturing industry can be physically dangerous for those not appropriately trained, as improper storage and cleanup can lead to serious health concerns for both workers and consumers. Many within the industry feel that this is too big of a risk compared to the rewards offered by making the change. Further, it is important to note that Uber and companies like it have come under fire for what has been perceived as a lack of corporate and social responsibility. Many young shoppers are paying close attention to the way that companies treat their employees, and throwing away prized benefits like retirement savings plans and health insurance could potentially lead to problems with public image.

 

The gig economy has already radically disrupted service industries like transportation and hospitality, and it is gradually creeping into the CPG sphere. Its presence is still relatively new there, and brands should learn from what has happened within the service sector and prepare themselves for what’s to come.

 

Redesigns and Refreshes: Why Change is Crucial

 

Each year, new design trends emerge. It’s important for businesses to keep up with these changes in order to remain competitive, and those that are really good at it can even position themselves as change leaders within their industry. As our Director of Business Development, Kory Grushka, put it: “Be very curious and stay on top of the latest trends and news – particularly in your industry, but also outside of it.”

Adjusting to Fit the Times

 

 

 

 

 

Rocky Mountain Chocolate Factory completely rebranded their packaging and store design to better fit in with today’s aesthetic style and feel. Graphic design studio, Wedge & Lever, took advantage of the new chocolate culture by giving the branding an upscale feel, with a color palette inspired by the chocolate itself.

Rebranding Efforts Often Lead to Huge Success

 

If a brand has become outdated, is declining in sales, or needs to stand apart from the competition, then a rebrand can provide the facelift they need to bring the right attention to the product. Rebranding also keeps customers interested and shows them that people are still hard at work behind the scenes making sure the product is the best out there.

 

Target proved this when they updated their generic Market Pantry packaging to give it a hip, trendy vibe. It now feels like a standalone brand, rather than an affordable generic pick.

 

Each product has its own detailed packaging, down to the type. The heavy typography feels fresh, like something that could be seen on a Brooklyn storefront. The badges for health feel like modern stamps now, instead of boring nutrition facts or your typical callout.

 

 

The Crunchy Oats & Honey Granola Bars now have honey dripping onto the top of the type. With the Toasted Rounds Baked Crackers, the “O” and the round portion of the “D” have treatment that feels like the edge of the cracker. The mixed fruit flavored snacks now have the typography as the teeth of smiling grapes to appeal to kids. On the Woven Wheat crackers box, the type is written so that it looks like parts are weaving in the crackers.

 

Some products (like the marshmallows) are transparent with only the logo and bold type showing, letting the product be the star of the show, and saving ink at the printer in the process. Other products, such as the butter, half and half, cottage cheese, and American singles have very flat packaging focusing on the typography alone.

Holiday Packaging

 

Changing packaging to fit a holiday, theme, or season can lead to huge profits. It can make your product stand apart from the competition and help build brand loyalty with your target audience.

Learn to Accept Change

 

 

While redesigning Campbell Soup Company’s V8 packaging, our research process included multiple store visits to each of the three club store retailers, significant desktop research and interviews of club store industry experts. Further, we audited cross-category products as well as the beverage category, and conducted extensive color studies that ultimately informed the variety differentiation strategy. The final designs focused on color blocking, bold callouts for the brand, varieties and pack sizes, and photo-realistic 3D renderings of the products.

Change can be scary, and with the risks that it carries, it’s easy to see why. But with a clear vision and full understanding of trends and modernity, the resulting redesign should successfully bring a design into the present day.

The Rise of Minimalism in Package Design

The trend for minimalist package design continues to pick up steam, be it forgoing lots of wording, using simplistic designs, going without labels, or even utilizing materials that are plain and simple.

Many companies are opting for clear-cut product labels, which allow consumers to easily identify and differentiate the brands from others on the market. In an era of information overload, savvy CPG brands are realizing that their customers appreciate minimal packaging.

Matt Ramirez, senior designer with Adhere Creative, an inbound marketing and brand development agency in Houston, Texas, said it’s strict limitations or restrictions that sparks creativity.

“Minimalism is the style of the day. Companies can still bend it to fit our needs whether we use color, typography, or simple flat graphics instead of images to stand out,” he said. “Having a roadblock forces us to think up creative ways around it. Having to stand out from the pack with less and less to work with is just another roadblock designers have to think around in a creative way.”

Marketing veteran David Miskin, CMO of Lightstone, first applied the minimalist attitude doing window displays while working at the Gap, and he’s seen minimalism rise in importance over the decades.

 

“I think everybody is familiar with the term ‘less is more.’ It’s important to realize, though, that design is not about less or emptiness, it’s about impact,” he said. “A minimalist philosophy doesn’t just spare space; the designer works using pieces that tell a story. By focusing on what is essential, a designer can better exemplify a company’s or brand’s narrative by focusing on a few points that make a big difference.”

Looking at traditional advertising—whether it was print, television, or billboards—Miskin noted there was such a dominant design across all mediums from the ’60s to the ’80s, that it got to a point where there was so much clutter that designers needed to go to the other end of the spectrum and clean palates again, starting from the basics to develop new concepts.

“In fact, many modern offices have employed streamline, to varying degrees, using negative space to tell the story of their brand,” he said. “In addition, this approach has led to greater productivity, collaboration, and ideas.”

Going Minimalist

 

Some of the design elements that can help contribute to a minimalism feel include using lots of white space, bringing out a message on a small portion of the packaging; relying on bold colors and visibly appealing fonts; or using a simple photo that tells the story you want to tell.

Still, minimalism doesn’t have to be a white background with a gray apple in the middle, either. It can be an orange box with a white swoosh or even a burger made out of the simple bars of the letter “E” in the word “whopper.” All are examples of minimalism however, they use the style in very different ways.

“Color, space, shape, and typography are all very important tools we have at our disposal to make brands stand out and look different while using the same trend to communicate our message,” Ramirez said. “Having a well-thought-out brand identity is an essential tool that we must never forget about. Pepsi and Coca-Cola both use minimalism with simple packaging and on the bottles themselves. However, never in a million years could someone mix them up because they have vastly different typography, colors, and overall brands.”

Miskin said that consistency within a brand is important when pursuing a minimalistic strategy, and the elements of the minimalistic design should be across the board.
“A brand needs to know who they are and not stray too far from their formula,” he said. “By not drifting from their identity, consumers will become loyalists who seek out a brand, quickly recognizing them in a retail space.”

Le Labo, for example, designs all of its fragrance brands in the same way.

“If you look at their packaging, it’s consistent: minimalist across all scents,” Miskin said. “Maison Margiela is a stand-out fashion brand with minimal store build-outs and packaging. Their stores’ design features include books painted white, scraps of wood, reclaimed fixtures, and a consistent grit throughout the stores. Just by going to that white, clean place, they developed such a strong brand.”

Minimalism in Action

 

Another great way to get the most out of a minimalist design is to let a label make eye-catching, bold claims, such as Boxed Water, which simply has “Boxed Water is Better” written in black against a white background.

It was a decision that company CEO Daryn Kuipers said was important to getting its message in front of consumers. Furthermore, the company put great thought into its packaging materials, again opting for a minimalist approach.

“By packaging our premium water in recyclable cartons that ship flat to our regional fillers, Boxed Water minimizes our carbon footprint and increases efficiency compared to bottled water options,” Kuipers said. “The paper for our cartons is sourced from trees of well-managed forests, where new trees are continuously planted to replace the ones harvested.”

 

 

Vodka Mariette is a premium French spirit designed for bold and creative millennial women and a minimalist design was accomplished in-house by Winz Hospitality with assistance from design firm MX Landau.

“To differentiate, an antique neckless carafe was designed in a shape reminiscent of the Eiffel Tower and/or a woman’s body,” said Josh Winzelberg, Vodka Mariette’s president. “It was made completely matte black, opposed to ornate glossy or frosted bottles that are common. Rather than painted décor, a label of quality paper was opted for, similar to wines and champagnes that convey craftsmanship and class.”

Furthermore, the fonts expressed a general contrast, creating the aesthetic of the brand, which is French Modern.

“The female-oriented style of contemporary minimalism with homage to history and craft via details is truly relevant now as a hallmark for the changing landscape of luxury spirits,” Winzelberg said. “This gives the bottle a ‘fresh’ look many others lack.”

The philosophy of minimalism is to omit needless things, so by paring down packaging materials and pairing down the visual aspects of the design, a brand can do wonders and send a big message by doing what’s seen as little.

 

Amazon Squares Off Against Big Box Retailers

 

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Earlier this year, Amazon reportedly began reaching out to several major consumer product brands, telling them that they’d be better off ditching retailers and selling their goods directly to shoppers through its service.

Amazon’s outreach culminated with executives from General Mills, Mondelez, Nike and other packaged goods manufacturers gathering for a three-day summit in Seattle this month to listen to the company’s innovative pitch.

Analysts point out that with a user base of more than 300 million shoppers (a number that increases monthly), Amazon doesn’t necessarily need these brands to bite – that they could simply manufacture their own products if the CPG companies don’t want to sell on Amazon’s marketplace. For companies that wish to avoid competing with the e-commerce goliath, it makes sense to consider leaving the Walmarts and Targets of the world.

An Increase in E-Commerce

 

AMAZON

 

Randy Evins, senior principal of IVE Food Drug & Convenience at SAP Retail, said e-commerce sales are growing at rates far greater than sales through traditional channels, and is only just beginning to indicate future growth potential.

For example, recent studies show that e-commerce sales of consumer packaged goods grew 42% in 2015, faster than overall e-commerce growth of 30%.  And growth in specific categories is surging as consumers increasingly take advantage of on-demand and subscription-oriented services, either direct from CPG companies like Dollar Shave Club or from online marketplaces like Amazon.

“Fast growth in e-commerce is starting from a relatively low current base, but is expected to become a far more significant percentage of total revenue and sales volume for CPG companies,” he said. “While e-commerce today is usually less than 5% of revenue for some of the largest, most established brands, we see predictions that e-commerce sales will grow to roughly 30% of total industry revenue within the next 3-5 years.”

In 2016, Amazon sales made up nearly half of all online sales—and more than half of online sales growth.

Mihir Kittur, ‎co-founder and chief commercial officer at Ugam, noted that the rise of e-commerce sales in certain categories like batteries and baby wipes is extremely encouraging, and that it seems to reaching a point where e-commerce for consumer packaged goods is at an inflection.

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“With the rise of Alexa, chatbots and mobile apps, consumers have more convenient ways to order. Customers have proved time and time again they crave convenience, so to align with their needs, retailers are also continuing to offer speed delivery services and are improving their buy-online-pickup-in-store options,” he said. “Consumers can also save more money now, thanks to the rise of private label CPG products. In the next two years, we should see an acceleration of e-commerce growth for CPG.”

The Case For Amazon

 

The e-commerce transformation seems inevitable. By partnering with Amazon, companies will find that it’s a much faster and less expensive alternative to doing it themselves, which means higher margins on sales.  Amazon, being a single vendor, would be easier to manage with almost a turnkey platform with joint marketing dollars to promote products. It would also be easier and less costly to test products in markets, so CPG companies could double down on winning products and discontinue products that don’t sell.

“Amazon’s approach goes well beyond simply inviting CPG companies to sell their products online via Amazon but, rather, to partner with Amazon to re-imagine product design, packaging, pricing and distribution to capitalize on direct-to-consumer growth opportunities,” Evins said. “By partnering to address these opportunities, Amazon aspires to collaborate with CPG companies in ways that not only capitalize on e-commerce sales growth, but also help to re-imagine business models and business processes to engage with consumers directly, effectively and profitably.”

Jim Prewitt, VP retail industry strategy, North America at JDA Software, said CPGs have been building out their direct to consumer capabilities for the past several years and while they’ve been able to build out their web capabilities, fulfillment continues to be a challenge.

Amazon Fulfillment Center Opens In San Bernardino

“CPG manufacturers’ supply chains have been built for efficiency, shipping in larger quantities typically to retailer distribution centers, where the retailer became responsible for breaking it down to customer buying quantities,” he said. “They are facing the challenge of changing their supply chain to be able to handle shipping eaches to the consumers.”

Amazon could help address the challenges for the manufacturers by serving as their fulfillment mechanism, taking the responsibility of shipping eaches to the consumer. On the surface this is potentially a winning combination for the CPGs and Amazon. However, it could cause issues for the other retailers in the equation.

“The pressure from mass merchants, grocery, drug, etc., who comprise large percentages of current CPG volumes could derail this effort quickly,” Prewitt said. “It’s not reasonable to expect that major big box stores would accept this arrangement with Amazon.”

The Quandary

 

CPG firms are struggling to figure out Amazon, Kittur said. While Amazon is the dominant player in the market, most companies are confused on whether to treat it as a friend or a foe.

“The fear is that selling on Amazon could lead to brand dilution, extreme price discounting, and at some point the risk of an Amazon Private label,” he said. “Another point of concern is the conflicts that arise with existing channels when sellers begin to carry their products on the Amazon marketplace. Overall, CPG brands seem to have good relationships in place with store retailers, but their e-commerce readiness is not as mature.”

As the CPG industry adopts e-commerce, they are more or less running blind, as they have no clear idea on transaction and shopper metrics. Adding to the challenge is that CPG firms are soon likely to be caught in a pricing dog-fight between Walmart and Amazon.

“Amazon needs to improve its trust with CPG firms. Amazon can gain some of that back by flagging pricing violations to CPG firms,” Kittur said. “In many instances Amazon has taken action against some sellers and it needs to continue to demonstrate this in a more widespread manner. It also needs to work with brands on specific propositions for certain customer segments like Amazon Business or on exclusive available-on-Amazon-only products to help them drive growth.”

Looking Ahead

 

CPG companies have begun to take a closer look at the e-commerce landscape to better understand what is going on, but so far, they have been in a situation of “they don’t know what they don’t know.”

Operations Inside the Amazon.com Fulfillment Center On Cyber Monday

“They will need to move fast and test and iterate their e-commerce game plan,” Kittur said.  “There are no clear answers, but doing nothing is not an option. They will also need to build meaningful relationships with companies like Amazon and arrive at the right balance of store and online to be relevant to their shoppers.”

E-commerce growth will continue to become more pervasive across categories, driven mainly by changes in consumer demand. Evins noted that in response, CPG companies will continue to transform their operations to participate more fully in the new direct-to-consumer economy through partnerships with online marketplaces like Amazon, or by developing new models that enable a consistent brand experience via online channels, sub-24-hour order processing and fulfillment, and warehouse and logistics operations to enable deliveries directly to consumers.

One tactic Prewitt said could happen is the creation of Amazon-only products, package sizes, or bundles, similar to what CPG companies do for individual retailers today.

“Since Amazon has identified CPG as a growth driver, in time we can expect them to impact the marketplace the way they’ve disrupted apparel and are working to disrupt the grocery industry currently,” he said.

The reality is that the CPG core competency is innovating on the product side, not on the supply chain side. It’s best for CPG companies to leave it to the online retailers to optimize their supply chain to deal with the last mile.

Brand Equity is Overrated

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Andy Warhol once famously claimed that America’s tradition of mass production was what made it a great country. He said:

“You can be watching TV and see Coca-Cola, and you can know that the President drinks Coke, Liz Taylor drinks Coke, and just think, you can drink Coke, too. A Coke is a Coke and no amount of money can get you a better Coke…all the Cokes are the same and all the Cokes are good. Liz Taylor knows it, the President knows it…and you know it.”

This kind of thinking, that every unit of a product should be exactly alike forever, has been part of the foundation of branding strategy for decades. Consumers had, in the past, relied on consistency as a measure of quality. But in 2017, the relationship that shoppers have (and what they want to have) with the brands that they buy has changed. Consumers are less trusting of big brands, and overreliance on sameness may be costing companies business with modern shoppers who are looking for more personal experiences.

Even Coca-Cola, Warhol’s shining symbol of mass production, is embracing the trend towards customization in their bottle designs. They took a huge risk with their enormously successful “Share a Coke” campaign, where they replaced their legendary logo with 1,000 different names.

namecoke

Not only did this create a smart, personalized experience for consumers, it also showed that the company understood the need for branding that lends itself to social media engagement. A big part of the customization trend is that the evolving media landscape has transformed company-consumer interactions, so that there are more conversations and less one-way dialogue. The “Share a Coke” bottles made consumers feel excited about drinking something that has been in their family’s fridge for generations, and by risking their brand equity, Coca-Cola saw soft drink sales rise more than 2%.

itsminecoke

 

The company has taken this concept one step further with their “It’s Mine” campaign. Using HP’s SmartStream Mosaic software, Coca-Cola produced millions of glass Diet Coke bottles, each with a completely unique design. Purchasing one of these bottles means owning the only Diet Coke in the world that looks the way that it does – no movie star or President can drink one like it. This is the future of branding.

When Tazo tea first came onto the scene in the 90’s, the spiritual, mythical look was considered innovative and modern — as The Dieline put it, the packaging “really represented the times”. For years Tazo was associated with that new-age image, and the design remained virtually unchanged for about two decades, even after the brand joined forces with Starbucks. Once the coffee giant completed their own redesign in 2012, they decided that it was time to bring Tazo into the new millennium. What was once a fun standout in the boring tea market was now corny and outdated, and nearly every visual element that defined Tazo was thrown out. In its place was a clean, white background,  with the flavors present in each variety clearly displayed in a neat little picture. The rebrand here was so successful because the company understood what was valuable about the product and maintained its spirit with the new look, while still being unafraid to go in a radically different direction than what fans were used to.

OLYMPUS DIGITAL CAMERATazo pre-redesign

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Tazo post-redesign

What is also interesting about the redesign is that nowhere on the packaging does it make any claim to be affiliated with Starbucks. Starbucks is one of the most recognizable and beloved brands in the world, and if the company was trying to introduce the tea to a new generation, then the association could have been a potentially valuable asset. The fact that they distanced the packaging from the Starbucks brand could indicate how the company anticipated consumers may come to feel about big brands.

Unfortunately, years of pink slime exposés and soy chicken sandwich scares have conditioned consumers to be wary of brands that could be considered “Big Food”. Today’s shoppers are drawn to brands that seem to care about them and their families, and the reputation of national brands as a whole is that they care far more about finding ethical shortcuts in order to increase profits. One of the core tenets of brand equity is name association, and if all shoppers can think of is artificial flavors and hormones, then brand equity is worthless.

Hellmann’s has also recently had a redesign to better appeal to contemporary shoppers. The “deli-inspired” look and feel of the product gives off a more wholesome vibe, and the photographs of eggs play into consumers’ desire for fresh, easily understandable ingredients.

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The color palette isn’t an extraordinarily dramatic change from what Hellmann’s had before, but the jar does look different enough that many longtime buyers searching for that distinct yellow label will have a more difficult time finding it. Some may even abandon the brand altogether, afraid that Hellmann’s is either now “too fancy” for them or that the change in design signifies some kind of major difference in flavor. Hellmann’s knows that they face these risks, and yet has chosen to ditch their iconic packaging anyway in order to stay relevant.  Ultimately, relevance does matter more than consumer loyalty.

Some companies are forgoing their usual branding in order to compete in a specific local market. For example, Airbnb, which has been hugely successful in this new anti-big-brand economy, just announced that they are not even keeping their name consistent across all markets. In China, they are now calling themselves “Aibingyi”, which is meant to be easier for Chinese users to pronounce. While it is not unprecedented for businesses to change their names when entering different markets, Airbnb faces unique risks in that this could cost them users that travel internationally, a group that is quickly growing. If a frequent Airbnb user from Sweden is vacationing in Shanghai, they may overlook the unfamiliar Aibingyi.

Brand equity, while important, is overvalued by big brands. More than consistency, today’s shoppers value niche traits like individuality, freshness, and smallness. Scarred by many years of health scandals, consumers do not have faith in big brands that way that they used to, and brand recognition is no longer the coveted feature that it once was. In 2017, companies that hold on too tightly to their same old branding risk falling behind in the new economy.

Packaging for Millennials

Millennials are the next wave of influential shoppers. Born between 1981 and 2000, studies show they will be 50 percent of the workforce by the year 2020 and will spend more than $200 billion annually, starting in 2017. Millennials are loyal to brands that treat them well, offer new experiences, and are aligned with their beliefs. That’s why it’s important that packaging appeals to this generation in the best way.

Joseph Anthony, a millennial marketing expert and CEO of HERO Group, has worked with some of the world’s leading brands such as Pfizer, Nintendo, Pepsi and Nike, says Millennials look for a personal connection to their preferred brands and are more likely to buy a product if it makes them feel special through this personal connection or the idea of exclusivity.

A new report from Mintel, Marketing to Millennials, revealed limiting the availability of a product creates a unique purchase experience in which brands effectively satisfy the pronounced desire of Millennials to have the latest, greatest and most exclusive products. It notes that offering a limited-time-only rollout of personalized packaging has the ability to create unique connections with consumers who might be mulling a purchase.UnknownDigital Plays a Role

The role of packaging in the digital space plays more of a brand-building role than in traditional brick and mortar shopping environments. In social media, packaging may not have to do the job of shelf impact and differentiation, but there’s an opportunity to play with brand elements in a simpler, more iconic way that makes consumers want to share across their social channels.

For example, packaging that includes quick-response (QR) codes right on the label gives consumers immediate access to a community that is also participating and purchasing the same products as they are.

Recent examples of brands doing this include Coca Cola, Frito-Lay’s and Heinz.

Lorrie Frear, an associate professor in package design and packaging science at the Rochester Institute of Technology, Rochester, N.Y., says that when communicating information about a brand, it is critical that brand managers and designers consider mobile as a key component of the entire brand strategy and not as an add-on

“Consumers use devices in making buying decisions quickly, so be sure that information is easy to find on the packaging and not small or hidden,” she says. “The user experience is critical to acquiring return customers, so be sure that any interaction takes less than a few seconds to accomplish and that the destination is reached within three clicks.”UnknownIn Vogue

A big trend in packaging with Millennials in mind is reseal. Over the last few years, the snack aisle has seen more and more packaging with reseal tabs to allow consumers to eat a handful and then reseal the packaging for later.

There are a few main benefits to this type of packaging, particularly for Millennials. It’s convenient and portable for their busy lifestyles; it promotes healthy snacking as many of these items are pre-cut, peeled fruit; and the food stays fresher longer using a moisture vapor film barrier.

Ryan Lupberger, founder of Cleancult, which delivers non-toxic laundry pods, designed his packaging with Millennials in mind. The company’s market research has shown that Millennials want to buy responsible products, but are actually 23 percent less likely to purchase a “green” brand.

“We saw that Millennials wanted two things. They wanted packaging that could be recycled, but they also wanted this packaging to be durable and design focused,” he says. “Most were not interested in packaging that signified it was cheaper or just eco-friendly. They care about purchasing products that combine design, convenience, and responsible packaging. They are not willing to sacrifice one of these things for a more eco-friendly package.”

Millennials also seem to care about humor in the opening experience of the packaging. Companies like Naturebox and Dollar Shave Club have done well because they combined all three things with a focus on humor.

Sustainable Packaging

While packaging design is crucial to set your product apart from competitors, a recent Asia Pulp & Paper study found that packaging appearance, including design, is less of a factor for purchasing than one might think. According to the research, Millennials are placing less focus on packaging design and demanding more functional and sustainable packaging. In fact, only 21 percent of Millennials surveyed indicated design as the most important feature when making purchasing decisions.

Reducing the volume of packaging – and the types of materials used – continues to be a good way to improve functionality and the sustainability of a product’s packaging and a goal of many companies around the globe. It not only makes sense from a business standpoint but also from a sustainability and customer relations standpoint.

Companies are discovering that one way to ensure and build customer loyalty is to prevent situations that may cause a delay in opening their packages. The simple solution is to utilize packaging that can be easily opened – no tools required. Paper-related products are not only the most frustration-free type of packaging, but they’re also one of the most recyclable and sustainable at this point.

The Art (and Science) of Club Store Package Design

club store package designIf we told you that Costco is the 3rd largest retailer on earth, would you be surprised?  Yes?  Well, you are not alone.  Few people realize just how large and prominent the club store industry has become.  Moreover, it has only gotten started, with the industry as a whole expected to grow at a 6% annual clip.

While the club store channel presents a tremendous opportunity for both large and small brands alike, it is also a very specialized retail environment with its own set of rules, conventions and potential pitfalls.  One of the biggest keys to success in the club store channel is understanding the what buyers and consumers look for in club store package design (hint: its much different than traditional package design).

Below is a SlideShare presentation that goes into detail about industry background, best practices and trends in the world of club store package design.  The slideshow is based on a presentation that we gave at the Packaging That Sells Conference in Chicago in October 2014.  Enjoy, and we would love to hear your thoughts and/or questions.

All About Club Store Packaging

Club Store Packaging

We are proud to announce that The Dieline has published our new article titled “Designing Club Store Packaging.”  The piece was written by our very own Kory Grushka, and features a nuts and bolts look at the club store industry, with a focus on club store packaging and design.  Below is an excerpt, and the full article can be found here.

Packaging for club stores is much different than packaging for grocery or other channels. The main difference is that club stores merchandize their products on pallets stacked with product, and the pallets create large billboards that can (and must) be used to capture a consumer’s attention. Given the minimal product assortment and the very large pallet displays, packages must both stand out on the pallet and communicate very quickly. Various rules of thumb have been established to capture the idea that a club store package must identify the product and quickly convey the core message. Whether it’s a “four- second rule,” a “five-second rule”, or some other rule of thumb, club store packaging must allow the customer to swiftly identify the product and the key selling points.

Infographic: Inside the Club Store Industry

In recent years we have been doing a great deal of work with club store strategy and design.  Over the course of our work we have learned to love the club, and so we wanted to highlight some interesting facts about the three key club retailers with an infographic.  Below you can find the fruits of our labor, and hope you enjoy it.  For what its worth, we plan to publish more of these soon, so let us know what you think…

club store strategy

5 Things to Consider When Choosing a Branding Agency

Choosing the right branding agency

There is never a shortage of things to worry about when running a business.  As a result, even for large companies branding is an often-neglected piece of the marketing puzzle.  Moreover, even when companies decide to invest in their brand, the field is a specialized one that can be hard to navigate.  Choosing the right branding agency should not only address an urgent business need (i.e., a new logo), but it can also change the way you look at your business.

There are a variety of things to look for when choosing a branding agency, but below we highlight five of the most important ones (in our humble opinion).

1. Do they (or can they) understand your business?

This may be the most important thing to discover about your shiny new agency candidate.  Most branding agencies will roll out their most impressive examples of prior work, and they will showcase their largest clients.  You should be looking beyond the sparkly exterior and really probing their business acumen.  Its easy to create beautiful and impressive looking designs and brand identities.  But beautiful and impressive are frequently not the solution to your business problem.  Do they have the ability to understand your consumer, your industry and your position in the market?  Will they lead their ideation and design process with those things, or will they focus first on creating visually engaging and cutting edge design solutions?  Not that there is anything wrong with beautiful and cutting edge, but those should be arrows in the agency’s quiver – not arrows that they shoot every time.

2. How creative are they really?

There are no (good) cookie cutter solutions when it comes to branding – or any other creative work for that matter.  Choosing a branding agency that comes up with fresh ideas and creative solutions will help set your business apart from the rest, stay current, and identify both problems and strengths with your business positioning.  Great creative will allow you to stand out from your competitors.  Obviously you want to look closely at their portfolio, and evaluate how pretty, cool and fresh their design work is.  You want their work to stand out in those areas from other agencies that you are interviewing.  That said, you also want to consider (and have them explain) how their portfolio projects compare to other brands in the relevant industries.  You want an agency with a deep understanding of branding, design and marketing trends.  While the most creative work is not always the solution, you want an agency that can always deliver the most creative work.

3. What are their past results like?

It shouldn’t be a secret what your branding agency can do for you, and what their past results look like.  Can they meet your goals? Ask for metrics, analytics, reports, and take a look at their measurable results.  ROI has become an overused buzzword, but it is definitely relevant in this context.  Ask for case studies where they detail the ROI that a client experienced in connection with their work.  Can they point you to the success of a past client after a rebrand project?  Can they point to a product that was a big hit after a packaging design project?  Can they give you numbers?   This will help you determine what their past results have been like, as a whole, and will also give you insight into what the agency finds most important (based on what and how they measure).

4. What is their process like?

Branding a product or service can be nearly impossible without a set process.  Accordingly, most agencies follow certain processes for their projects.  Many have trademarked or otherwise named their processes.  While these are often cheesy catchphrases, they at least give you a look into your prospective agency’s creative process.  If they don’t offer up details about their process, ask about it.  Most branding processes start with some form of creative brief – ask to see a sample creative brief.  Dig in and don’t feel bad about looking behind the wizard’s curtain.

5. Are they a versatile bunch?

You need to have a real understanding of your business problem, and you should have expectations in terms of what services and deliverables you will need.  Obviously you will look to your prospective agencies for their feedback on those points, but the first step is understanding the problem.  In that regard, very few branding agencies can solve all of your problems on their own, with their in-house staff.  Most branding agencies rely on freelancers to complete certain aspects of their client projects (designers, web developers, copyrighters, etc).  Be sure to ask what their core capabilities are internally, what they would need to outsource as part of your scope of work.  The more they can control in house, the better.

Choosing a branding agency – or rather, the right agency – will take some time.  Ask for references, google them, compare portfolios, and take your time researching agencies.  And last but not least, make sure you like who you will be working with and are confident that they are the right cultural fit for your company.