Enhancing packaging innovation with customer satisfaction in mind

Answering the needs of the consumer

CONFIDENTIAL

Arun Prabhu

Commercial Innovation Director, Arla Foods Denmark

23rd May 2013, Pack Innotech – Bangkok, Thailand

• Linking consumer and customer needs to packaging design

• Using consumer immersions to get to deep level insight

• Delivering novel solutions through packaging

• Case studies:

• Function: Cravendale

• Design: Lactofree

• Style: Starbucks Iced Coffees

Outline

• Style: Starbucks Iced Coffees

Arla Foods: A global dairy leader

These are my views, not necessarily Arla’s

Developing new

products,

formulations, line

extensions

Transformational

ChannelPackagingProduct

Developing new

packaging

for existing and

new products

Introducing

existing and new

products into new

to the company

channels; new

routes to market

Growth prospects that

have significant

impact on profit

MarketingRoll-OutCategory Business Model

Creating

combinations of

product and

service offerings in

ways that are

completely new to

the business

Creating newness

at a category

level; Introducing

existing and

new products into

new to the

company

categories

Introducing

products/brands

from elsewhere in

the group/ outside

into new markets

Going beyond

brilliant

advertising and

communications

to find new

consumer need

states, occasions,

usesand relevance

COMMERCIAL

30 April 2013 4

Transitional

Transactional

Creating future growth

Protecting and

maintaining existing

business

Manufacturer Customer

Will it grow our business? Will it expand the category/

bring new shoppers in?

What is the challenge?

What is the optimal packaging solution?

ShopperConsumer

Is it superior to what I’m using now? Will it improve my shopping experience?

The consumer’s first ’moment of truth’

Source: Adapted from A G Lafley and others

The consumer’s second ’moment of truth’

Source: Adapted from A G Lafley and others

But… I don’t trust consumers

Lies!

I don’t believe these consumers

Source: http://www.ipsos-na.com/download/pr.aspx?id=12481

Consumer tends to respond to new concepts

with rear view mirrors

19851979

They don’t know what they want

If I’d asked my

customers

what they

wanted, they

would have

said a faster

would have

said a faster

horse

Henry Ford

When we were

creating Bailey’s Irish

Cream, the concept

bombed in consumer

research. So we lied to

the board to push the

So it’s best to ignore them!

the board to push the

concept through.

Project Leader

Communicate with Prosumers

Prosumer – the 20-30% of consumers who determine

the future success of brands

Prosumer - a new breed of consumer who is more

marketing savvy and demanding

Prosumer - proactive in seeking out information and

opinions; active in sharing their views and

experiences with others; and ahead-of-the-curve in

their attitudes and behaviours

Source: EuroRSCG

Prosumers are 2.5 times more

likely to be asked for – and to

offer - their opinions on brands

Prosumers are the most

likely to influence, and

be influenced by others

The average Prosumer

has 5 times the influence

of the average Consumer

Why the Prosumer matters

Prosumers are 2.3 times

more likely to regard

themselves as ‘leaders’

Prosumers are 1.5 times

more likely to pass on their

brand experiences and

points of view

be influenced by others

Source: EuroRSCG

A Prosumer by any other name…

Thinking

Doing Saying

Prosumer Insight template

VISIBLE: What they did or said

Believing

FeelingINVISIBLE: Why they did or said

The Arla Foods challenge:

We’re creating a new category and we don’t have a big budget,

so how do we win at the first moment of truth

The in-store challenge:

How do we show we’re different to all the other dairy alternatives

The consumer challenge:

How do we attract her attention when she walks past the fixture

The Lactofree GRAPHIC DESIGN packaging solution

The design stands out on a

crowded fixture

The name describes the product

The cow icon clearly

depicts that this is

made from cow’s milk

The Lactofree GRAPHIC DESIGN packaging solution

Today, the cow icon helps

shoppers easily navigate the

entire range

Launched in Jan 2006, today the

brand is worth €40m+ in the UK

and is also being rolled out in

Denmark and Netherlands

The category challenge:

Milk packaging all looks the same. How do we differentiate?

Northern Europe (Fresh)UK

USA Southern Europe, Asia (UHT)

The consumer challenge:

I love drinking milk straight from the fridge,

but it’s inconvenient

The shopper challenge:

In the UK, milk sold in 1l TetraPak (gable top) is not ”real” milk.

They are dairy alternatives.

What dairy manufacturers THINK is the consumer challenge:

People want eco-friendly milk packaging and are willing to pay

more for less convenience

Green Bottle: Launched 2011

A paper bottle made from trees

www.greenbottle.com

JugIt: Launched 2008

Help create 75% less waste

www.jugit.co.uk

Ecolean: Launched c2005

A lighter approach to packaging

www.ecolean.com

The Cravendale STRUCTURAL DESIGN packaging solution

Opens up new customer and

channel opportunitiesUnique and ownable shape clearly

stands out on shelf

Plastic material places it in familiar

”real” milk territory

Ergonomic neck makes it easy to grip

(for those wanting to grab a chilled

500ml variant opens

new channel and

occasion opportunities

(for those wanting to grab a chilled

one from the fridge)

The UK’s No. 1 dairy leads the

way with consumer needs

based innovation

The Starbucks challenge:

How do we give our customers Starbucks moments when they’re

not in our cafes

The consumer challenge:

I want to join in the Starbucks culture,

but I’m not a big fan of coffee

The Starbucks Discoveries STYLISTIC DESIGN packaging solution

Looks and feels like the

iconic Starbucks coffee cup

Launched in Apr 2010 in UK and

Germany, today the brand is

worth €25m+ and has been

rolled out to more than 15

countries across Europe

Product and packaging designed to

introduce new Starbucks moments to

new and existing Starbucks customers

The consumer challenge:

How do I balance the challenges of taking my baby out and about

with me: diapers, feeds, stroller, etc?

The Baby&Me Organic CONVENIENCE packaging solution

No need for Mum to carry

sterilised bottles + cartons of

milk + scissors to open carton

”All-in-one” solution combines milk

and sterilised nipple

But…

the competition beat us to the market

You may have the best

ideas in the world.

But they’re of limited

value if they stay

inside your

Closing Thought

inside your

organisation.

Get them in front of

your customer before

your competitor does

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