"Private Labels Seek Packaging Innovation to Build Premium Brands"
Alan Isacson, CEO
As the economy begins to rebound, consumers are loosening up their wallets and spending more on themselves and others. Research suggests that now is the time for companies to invest marketing dollars in package design and development so their brands stand out in store aisles as consumers loosen purse strings.
A rising trend in private labeling is the introduction of higher priced, wider margin brand extensions such as premium and organic products. To command higher pricing, premium brands must look high-end and project high quality. To project premium value, strategic packaging takes center stage – creating innovative and distinctive appeal. For example, incorporating greater convenience with easy resealable, slider zippers or with effortless, push-button power-dispensing can effectively increase consumer preference.
More retailers are creatively applying new packaging strategies that no longer replicate national brands but launch in their own distinctive designs. Introducing premium extensions will be a critical component for private label companies to grow market share and profitability. Private label brands and consumer packaged goods companies (CPGs) alike should also consider new ways to use existing materials for maximum shelf impact. For example, rigid metal is a packaging material that radiates a luxurious feel but doesn’t require a luxurious wallet to pay for it. In addition, metal packaging is 100% recyclable, so it helps accumulate points on Wal-Mart’s Packaging Scorecard. Recyclability appeals to consumers and can help sway or change buying decisions, especially when packages also feature unique shapes or decorative finishes.
Bright colors and rich graphics will also help brands dominate store shelves. Current trends will drive further innovations in color such as greater emphasis on fluorescent colors and dynamic color changes that simulate movement to capture consumer interest. These innovations also support premium appeal, particularly in cosmetic and specialty food applications.
As the economy rebounds, club store sales are still seeing jumps as consumers continue to buy in bulk. According to Retail Info Systems News, major club store retailer Costco has seen improving sales since February of this year. Moving forward, it will be important to enhance the look and convenience of multi-serve packages to further fuel sales.
With consumer spending on the rise, it’s more important than ever for retailers and CPGs to consider packaging as the "on-shelf tipping point." Innovative packaging serves as “the closer” that captures the sale at the shelf.