Brand Square: Next Steps in Private Label Packaging
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Private Label: Taking the Next Step in Packaging Brand Square November 19, 2015 Jim Lucas 1
Transcript of Brand Square: Next Steps in Private Label Packaging
PrivateLabel:TakingtheNextStepinPackaging
BrandSquareNovember19,2015
JimLucas
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NBE/QualityMissionAccomplished
• Theoldimage--consumersbuyprivate-labelbrandsforcostreasons,butviewthemasinferior.– 42%ofMillennials(ages18-36)agreestore
brandfoodproductsaremoreinnova*vethanname-brandproducts.
– AndMillennialslikelytobuystorebrandfoodsingeneral(97%versus94%ofallU.S.shoppers).
– Nearly2/3rds(63%)ofstorebrandbuyers—including70%ofMillennials—agreethattheseproductsarehigher-qualitythantheyusedtobe.
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Using Shape and Color to Communicate Functional Benefit
(NBE)
ValueBeyondPrice• WhatisinfluencingPLpackagedesigntoday?
– PLhasexperiencedastagnated.Retailerslookingfornewareasofopportunity!
– Nowthattherecessionhaseaseditsgriponhouseholdfinances,consumersarelookingformorefromPLbrands.
– Consumerneeds&expecta^onsaboutpackagingevolvingrapidly
– Beyondprice,consumersaregivingOwnBrandfood&beverageproductsgoodmarksforinnova^on.
• PrivateLabelpackaging,mustcommunicatebeyondprice.
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Retailershavebeen(Pro)AcGve
29%ofUSintroduc^onsinfood&beveragearePrivateLabel
Source:MintelGNPD4
Challenges/OpportuniGes
• PrivateLabelpackagingmusttocommunicatebeyondsimpleprice
• PrivateLabelStrategies,PorcoliosandRangeshavebecomemorecomplex.
• Makingchoiceeasier.• Moreover,retailerss^llhaveamarkeddisadvantagevis-à-visbrandedCPGintermsofmarketspend…soareturningtotheirpackagingtoworkevenharder(andsocial)!
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• GreaterneedtocommunicatewithpackagingtocommunicateNBEstatusofPLbrands,– Value– New,morecomplicatedarchitectures(beyondG-B-B)– Healthyliving/Nutri^on– Makingchoiceeasier– Premium– Crai&Ar^san– Seasonal
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More than 3/4ths of grocery shoppers choose food based on the fact that it tastes good, and 65% look for high-quality ingredients. Conveying these aspects of a product on pack is being considered in order to appeal to the largest proportion of food buyers.
On-pack Messaging Should Match Consumer Decision-making
Base:internetusersaged18+whoareresponsibleforatleastsomeofthegroceryshoppingforthemselves/theirhouseholdSource:LightspeedGMI/Mintel
LEADING FACTORS INFLUENCING FOOD BY GENERATION GROUP, MAY 2015 “Which of the following factors are most important to you when choosing which food products you buy?”
Pack Similarities Brand comparison: Private labels openly compare themselves to brands by copying the packaging especially in categories like cereal, sauces and dressings, pasta, laundry detergents, personal care and pet food
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Source: www.consumerreports.org
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Value Ranges Get Revamped Retailers striving for balance in basic ranges – restraint, but not cheap/bad packaging. Usually white packaging.
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Target Up Walgreens Nice!
Walmart Great Value CVS Just the Basics
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Multiple Positionings
Ketchup July 2011
France
Sauce October 2013
France
Same private label, different positionings: Five table sauces condiments targeting different consumer needs by Carrefour, that go beyond good-better-best.
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Mustard July 2013
Brazil
Ketchup April 2012
Spain
PremiumDiscount
Bearnaise September 2013
France
Standard Healthy Ethical
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ItsnewinternaGonalfoodsbrand,Hemisfares,aimstoincreaseKroger’sappealtothemore
adventurous‘foodie’shopper.
Krogerhasreinventeditsentrylevelbrand,reGringits‘Value’labelandreplacingitwiththreenewbrands;thenewbranding
ismorefunandinteracGve.
InvesGnginPrivateLabel
Source:IGDResearch,Kroger
TheSimpleTruthbrandconGnuestoearndouble-digitunitandsalesgrowth,withmorethan20millionhouseholdshavingboughtoneormoreofthe2,700availableitems.Itofferslowprices,forhighquality
products.
HealthyLiving
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Source:IGDResearch,Retailers
NewHealthyLivingImpetus
• HealthylivingandwellnessaregrowingprioriGesformanyshoppers.
• Asretailersseektobe]ertailorstorestotradeareasanddifferen^ateformats,focusonhealthcandrivecompe^^veadvantage.
• Significantopportunityingrowthacrossorganic,free-from,vegetarian,children-specificandbroaderwholesomefoodranges.
Ashealthrisesfurtheruptheagendainmanymarkets,moreretailersareusingprivatelabeltoshowcasetheirhealth&wellnesscredenGals.
Supervaluisrefreshingits‘WildHarvest’rangewithanewbrandposiGoning,logoandpackaging.Thiswillbesupportedwithanew“EatFree.GoWild”integratedmarkeGngcampaign.
SimpleTruthreached$1.2Bsales;20Mhouseholdsbought1ormoreofthe2,888itemsinthepastyear.
Source:SixTrendsinPrivateLabel,IGD2015.
HealthyLiving
• Allagreeshouldeathealthier,watchwhattheyeat.– Morethanhalfofshopperssaynutri^onalpanelsareinforma^ve
– 1/3rdofconsumerssaynutri^onalpanelsinfluencepurchase
– Only25%ofgroceryshopperssaynutri^onalpanelsareeasytounderstand.
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FoodPackagingImpactbyAgeGroup
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LookingLessatOverarchingClaims
Source:Mintel
35%
38%
38%
48%
50%
62%
80%
0% 10%20%30%40%50%60%70%80%90%
Local(fromalocalcompany/farm)
Allnatural
Nosugar/high-fructosecornsyrup,
Fullservingoffruitorvegetables
Lowsugar/carbs,salt/sodium,etc.
Good/Excellentsourceof(vitamins,
Anynutri^on
FoodclaimssoughtbyUSconsumers,April2013
ChangesinPackageClaims,2010-2015
SHAPE AND COLOR BRANDING
Vivi Verde July 2012
Italy, Coop
Carrefour Bio September 2013
Italy, Carrefour
Healthy living ranges strive to look natural: Prevalence of green and brown, matte finishes.
Source: Mintel/GNPD, Private Label Packaging, 2014
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naturaplan October 2013
Switzerland, Coop
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HealthyLiving:AugmenGngPackaging
• Consumerswanttobeabletomake“healthier”choices.Onpackcommunica^onsaidedbysocialmediaand/orwebsites—crediblesources.– ForexampleKroger’sSimple
Truth&SimpleTruthOrganicare“Freefrom101”ingredientsthatcustomerstoldKrogertheydon’twantintheirfood.
– Similarly,WholeFoodsMarketshasalistof78ingredientsthatareunacceptableforfoodproducts.
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hqp://www.wholefoodsmarket.com/about-our-products/quality-standards/food-ingredient
hqps://www.facebook.com/simpletruth/
hqp://www.simpletruth.com/
MeeGngConsumerNeeds
• Visualandtac^lethenew“op^cs”.Easiertochoose.
• Func^onality—re-sealability—freshness,portability,mul^pleoccasions,wastecontrol.
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ConsumerPercepGonsMoreImportantthanOn-packMessages…
Ingredients:TurkeyBreast,Water,Honey,Contains2%orLessofSeaSalt,EvaporatedCaneSyrup,RiceStarch,Vinegar,CarrageenanfromSeaweed,LemonJuiceConcentrate,CeleryJuicePowder
Ingredients:Water,Honey,SeaSalt,EvaporatedCaneSyrup,CeleryJuicePowder.
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Target:ArcherFarms
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SavorEverydayNaturalSrirachaS^r-FryChickenStripshavebeenreformulatedandarenowmadewithnewingredients.Thefullycookedstripsareminimallyprocessedandcontainnoar^ficialingredients.
AppleCinnamonCrispGranolacanbeusedasacoldcereal,anon-the-orasatoppingformuffinsandquickbreads.Itcontains29gwholegrainperservingandisagoodsourceoffiber.Thiskosherproductretailsinareclosable12-oz.pack.
Premium• Retailersareevolvingandreposi^oningvalueand
premiumranges;premiumwillmoveintonewareasandcreatenewcompe^^onforbrandedsuppliers.
• Discountretailersarepushingfurtherintopremiumprivatelabel,whileothersaretarge^nganewtypeofprivatelabeldevelopment,includingexclusiveranges.
• BlackandGlossfinish
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Premium
• TheKrogerCo.launchedrecentlyanewlineofpremiumprivatelabelbrandproducts,importeddirectlyfromthemostfood-richregionsoftheworld.“HemisFares™isaguidedtourofthebest-of-the-besttastestheplanethastooffer–foundexclusivelyattheKrogerfamilyofstores.”
– Packagingforeachproductisunique,asittellsthestoryofthefoodfind.EachHemisFaresitemhasa"findnumber"onthepackagingtodirectcustomerstoothersimilarproductsintheHemisFaresbrandthattheymayenjoy.
KrogerHemisFares
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Cran&ArGsan:Premium-izaGonBeyondProcessed
• Anotherwayretailersare“preimium-izing”isviacraiandar^san.– Provenancetoproduc^onmethodscanserveasclues
– Ar^sanmorebelievablethanpremium– Counter“overprocessed”percep^on– Craiassociatedwithingredientquality– Packaging:wood,fabric,craipackagematerialsarebecomingmoremainstream.
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Cran/ArGsan:3ElementsTellingtheStory
MaterialPackaging,oraclosureorotherfeature,madefromamaterialassociatedwithcraismanshipsuchaswood,leatherorfabriccanenhancear^sanproductclaims.VisibilityConsumershaveagrowingdesiretoseeproductsbeforetheybuy.Thisispar^cularlythecaseincraiedorsmallbatchbrandswhereconsumersexpecttoseetheproductvariabilityinherentinsuchproducts.
InformaGonBringingthehumantouchtothepackagingthroughnumbering,handwriqenlabelsorbringingthedetailsofthecraitothefore.Digitalpackagingwillenablesuchpackvaria^ononamassscale.
Source:MintelGNPD
Source:Mintel/GNPDCrai&Ar^sanPackaging,2015
EroskiSeleQ^aWhiteKidneyBeans
Seasonal• Seasonalproductsaccountfor5%ofsupermarketsales
(Mintel,SeasonalPackaging,2014).• 22TraderJoe'sPumpkinSpiceFoods,2015• Opportunityfor“newtradi^ons”andincremental.
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FinalThoughts
• Manyopportuni^esinPLforbothdevelopingandrevampingpackaging– Beqer,moresophis^catedcommunica^onroleforpacktohelpconsumers
• Value• HealthyLiving• Mee^ngConsumerNeeds• Premium• Crai&Ar^san• Seasonal
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FinalThoughts• Abilitytocommunicate:
– Facilitateconsumerchoice– SensoryProof– Claims/Benefits– Func^onality
• Packagingisbeqeraqunedtoshopperneedsandbeqerdesignedaround“momentsoftruth”
• Cleanlabelexample:– Detailsonline(ZMOT)– Easytounderstandatshelf(FMOT)
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FinalThoughts
• Packagingisbeqeraqunedtoshopperneedsandbeqerdesignedaround“momentsoftruth”
• Healthyliving:– Detailsonline(ZMOT)– Easytounderstandatshelf(FMOT)
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