This article was originally written for and published in the 2013 Labels and Labeling Yearbook by Steve Callahan, President of Perimeter Brand Packaging.
As the Consumer Product Goods (CPG) industry evolves, the packaging industry needs to look beyond the customer P.O. and adopt a consumer validation mentality. R&D traditionally focuses on the engineering and technology versus human perception. If a product label is truly the ultimate billboard, the industry needs to understand how their business serves the end-user, the consumer. The end result will be an informed dialogue with brand owners and purchasing departments that present both technical feasibility and consumer utility.
Recent research revealed that over a 5 year period, less than 1% of products launched are considered “innovative”. Many new product launches are simply line extensions or slight improvements to the product. The true breakthroughs have one consistent theme – engaging early on with consumers to understand their insights and painpoints. Discovering how they interact with the packaging’s structure and label is a critical step in launching truly innovative products.
In 2013, expect to see the following trends:
ON THE GO
We live in a mobile society. With the average American adult spending 2.5 hours in their car every day, people call cars their second home. And when people aren’t running errands around town, they are traveling across the country. About 1.7 million people get on an airplane every day.
As a result, CPG companies are racing to provide consumers with miniature, travel-friendly versions of all their favorite products to take the comforts of home with them on the road. CPGs are already taking note of this trend and taking it one step further, many products have been designed to conveniently fit inside car cup holders – everything from Puff’s tissues to Oreo cookies are now easily-accessible and only an arm’s reach away. For long-distance travels, grocery stores now devote an entire aisle to travel-size items – dominantly personal care products like shampoo, soap and shaving cream to allow passengers to abide by the 3.0 oz or less policy instated by the United States Transportation Security Association (TSA).
In 2013, expect the trend to grow beyond the personal care industry. Food and beverage brands have already taken notice with breakthrough products like Kraft Mio; a liquid water enhancer which Kraft claims is the first new category launch for the company in 15 years.
With sweeteners rapidly replacing traditional white sugar, Splenda released a new Splenda Minis product. Splenda Minis are dissolvable tablets that come in a protective case, providing Splenda-lovers with an easy click-button solution to fix their sweet tooth while they are on the run.
The on the go trend is not only convenient for consumers, but also a win for CPGs, as the product can be sold in an entirely new storefront space or as on-pack bonuses or trial-versions packaged with full-size products consumers normally purchase. These bite-size solutions provide incremental revenue streams at king-size margins and open up new retail opportunities, such as vending and convenience stores.
As you commit to consumer validation in 2013, take time to understand the consumer’s active lifestyle away from the home and how that changes their interactions with everyday products. Do consumers prefer subtle branding since they are often used in public? Consider the refill implications for consumer usability and whether your solution can hold up to wear and tear.
OUT TO SHARE
Consumers are increasingly choosing to make their experiences a shared one with friends, family and co-workers. This desire to share is translating over into the packaging world with solutions that move seamlessly from the store shelf to at-home use. In 2013 we will be seeing many more packaging solutions that encourage community consumption and that you can serve directly from the original package.
Some of these solutions will be focused on party-like settings, like Frito Lay’s new packaging solution for Stacy’s Pita Chips. In 2012 the company released a new package for their upscale product that added a flat bottom and re-sealable zipper to the traditional chip-bag style pouch. This turned the former stock-like package into a party bowl.
Perimeter Brand Packaging studied this consumer behavior and created a new solution called Handout, a product designed to increase on-shelf visibility and consumption of products like candy. The Consumer Insights team conducted a study of 1,000 consumers to understand the impact of the packaging on purchase intent and at-home usage and found that consumers expected to consume up to 89% more from the out-to-share style package than the traditional bagged candy. Consumers said they liked that the container could serve as a candy bowl, at home or at the workplace, where they liked the idea of leaving it out on their desk to share with co-workers.
The research also revealed that the full-color in-mold labeling (IML) graphics significantly increased the product brand recognition and created a premium appeal for the product. The full-color IML graphics not only allow for strong brand reinforcement, but also appealing seasonal patterns. This provides manufacturers with the opportunity to increase merchandising opportunities, for both on-shelf and seasonal promotional displays. Once again, the commitment to consumer insights helps drive conversation with CPG brand owners and R&D managers.
Popcorn may be the quintessential out-to-share food product. Appropriately, Orville Redenbacher also released a similar bowl concept in 2012 for their popular microwave popcorn line called the Pop Up Bowl. To avoid mess and the need for a secondary bowl, their new microwave packaging expands to form a bowl with a tear-off lid, allowing consumers to fight for the last few buttery pieces directly from the original package. The new open-top also resolved the consumer pain point of getting their hands messy while reaching into the buttery container. The product was named the 2012 Product of the Year in the snacks category by the Consumer Survey of Product Innovation.
The out-to-share trend is a big opportunity for the packaging industry. Products that were traditionally being thrown away or stored in the pantry are becoming staples in the kitchen or other frequently seen locations.
Just as the fashion industry now must address the trends of seasonality almost monthly instead of quarterly, CPG companies are under pressure to quickly address market trends, seasonality and innovation. A by-product of our consumer research is an understanding of the growing importance of rapid innovation. Open innovation has flooded the industry with new ideas, all hoping to reach the desks of key decision makers in the largest CPG companies. However, the products that move from concept to execution are those that are able to engage not only in one stage, but throughout the development, production and launch phases of a product lifecycle.
Perimeter Brand Packaging works closely with partners like Inland Label, a label printer and global supplier based in La Crosse, WI, who share a “speed to volume” philosophy. This saves everyone, including printers and converters, time and money.
As you consider the value of consumer insights in your business planning, leverage research to validate your recommendations – and ultimately increase your market-ready capabilities.
Product innovation will be a key driver of growth in 2013. Labels and packaging can drive innovation by expanding their purpose by becoming a functional aspect of the product.
Inland Label’s development of the Coors Light color changing label is an example of creating an interactive label. Color changing inks indicate when the beer is at its ideal drinking temperature which both educates and empowers the consumer creating a more enjoyable experience.
“What started out as a promotion has turned into an innovation that completely revolutionized the Coors Light brand,” said Jackie Kuehlmann, marketing manager at Inland Land. “Inland Label continues to work with the Coors Light brand team to evolve the technology, which has allowed them to keep their package fresh and maintain their brand growth.”
In late 2011, H.J. Heinz launched the Dip & Squeeze Ketchup package, which gained a lot of media attention in 2012. The new product provides consumers with two ways to access the condiment – it peels back for dunking or the end can tear off for squeezing the product on to favorite foods. In 2011 the product has won the silver award from the Dupont Awards for Packaging Innovation for “capturing the spirit of innovation to resolve consumer challenges”.
“Dip & Squeeze marks the most significant packaging innovation for the ketchup packet in more than 42 years, revolutionizing the way consumers enjoy Heinz Ketchup,” said Michael Okoroafor, vice president Heinz Packaging Research & Development.
Likewise, Perimeter Brand Packaging has developed a product called Freehand, a device that is designed to show a measurement of how much liquid is being poured while dispensing the liquid – eliminating the need for a measuring cup and increasing consumer interactivity.
In all cases, the core product being sold did not change– it was the package functionality driven by consumer insights that delivered the innovation.
Studying consumer culture will always readily reveal packaging trends and labeling needs for the future. In 2013 the labeling industry needs to focus on consumer insights to understand how ever-evolving behaviors will impact the labeling world. As you look ahead to 2013, challenge your team to consider how labeling solutions can support innovation. Commit to driving innovation through material selection or design application. Most importantly, validate your innovation with consumers before you present them to your customers for success in 2013.
Steve brings over 25 years of practice and study on innovation, product design, talent development, and organizational leadership. He is the President of Perimeter Brand Packaging, an Open Innovation partner to leading CPG companies.
This article was originally written for and published in the 2013 Labels and Labeling Yearbook. Labels and Labeling is the global magazine for the label, product decoration, web printing and converting industry.