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Where Brand Identity Meets Economies of Scale

Elizabeth Abrams
  • Consumers demand economy in addition to sophistication in products.
  • Becoming sustainable has marketing benefits.
  • The more elaborate the packaging, the more difficult it can be for consumers to discern what it is they are buying.
  • By retooling packaging’s look, structure and delivery, the consumer’s first impression, money savings and sales gains can be simultaneously improved.

The carton, jar or tube propped on that store shelf provides the first impression of a brand’s product to a consumer, and the brand and product packaging is critical to the success of both. The color, shape and even texture helps define the brand, and as a company or brand image alters, so should the packaging.

But there is another side to that jar of whipped blush the consumer is considering, perhaps more now than ever. Consumers want sustainable goods with less environmental impact, and are clamoring for these goods during a slow economy. In essence, consumers have adopted the idea that less is more, making the goal to reduce waste and reduce price a primary one. Forward-thinking executives know packaging should take into account both environmental and logistics costs. If done correctly, beauty, sustainability and cost can all be accounted for to create a beautiful and affordable green product that also saves brand owners money and increases sales.

Beauty: Please the Eye

There has been a clear and recent packaging evolution for cosmetics and fragrances. Instead of intricate, detailed and often overworked tubes, labels and logos, brands are streamlining their look and projecting a clearer image of their products to their target consumers in the process. The reasoning goes that consumers equate simplicity with good taste and high quality.

MAC and Nars cosmetics follow this trend succinctly. Simple, white logos on black packaging make for a professional and, therefore, high-end look that rivals that of more expensive brands. The message here is: Let the product speak for itself. The more elaborate the packaging, the more difficult it is for consumers to discern what it is they are buying—pretty packaging or a sound product. In some cases, consumers even equate intricate labels and signature-shaped compacts to lower quality goods, relying on the theory that a product lacks sophistication if the packaging does not project that professional look.

This trend toward simplicity is emerging throughout the consumer product goods. Not limited to health and beauty items, consumers are watching as their favorite food and beverage brands undergo makeovers to look more streamlined. Labels and even logos are making the transition from demonstrative to demure in an effort to project a clean, fresh and more economical image.

Sustainability: Please the Conscience

After determining a look, brands can consider form and function—a perfect place to become more sustainable. Remember though, consumers demand economy in addition to sophistication in products. This is essential to embracing sustainability, as the truly green product will naturally cost less to produce as a result of waste reduction.

Consumers are savvier at discerning truly sustainable goods from those simply nodding their heads at going green. In line with the idea of simplicity over opulence, consumers now prefer natural over synthetic. The number of sustainable products grew 79% between 2007 and 2008, and 66% of retailers are transitioning to sustainable products, according to the TerraChoice 2009 Greenwashing Report and the Retail Industry Leaders Association, respectively. What does this mean? Consumers want true sustainability reflected in their purchases, so don’t make an inauthentic effort at going green.

But remember, packaging must be durable, flexible and light. Review your product: Does it tend to lose its scent if left out for an extended period of time or does it tend to absorb the scents of products around it? Is it delicate, requiring several layers of packaging? What about damages? Is your claims rate on an incline? Enlist key people from each point in your product life cycle: development, production, sales, marketing and operations.

Consult industry associations with experience. The Sustainable Packaging Coalition endorses several packaging methods. Consider both reducing and revamping your packaging materials. Alcan Packaging Beauty, for example, offers three lightweight eco-friendly tubes. Its Access Denied tube has a tear-off band integrated into the cap, so that it is naturally tamper-resistant and eliminates the need for a shrink sleeve.

Also speak with expert logistics providers with knowledge of your product line, and ask them about increasing pack out. You’ll save on outer packaging and also cut back on transportation costs, getting increased density per pallet. Remember that becoming sustainable also has marketing benefits. Walmart, the world’s largest retailer, uses both its Sustainable Packaging Scorecard and its Sustainability Product Index as litmus tests between suppliers. Rating well enhances a brand’s relationship with its retailers and offers the chance to market as truly sustainable.

Logistics: Please the Wallet

Now that your product has a fresh face and a lightweight more compact design, it’s time to find a logistics provider to safely store and ship your goods. Logistics costs account for 6.9% of consumer product goods company sales. Of that, 38% is associated with outbound customer transportation, according to the Grocery Manufacturers Association. And relying on a shipping department to call around for the best quote is no way to efficiently ship or monitor your product. Consider outsourcing to a logistics provider with long-standing relationships with hundreds of carriers. Their large shipping volume will dictate a much more competitive rate.

Also look for someone with experience shipping similar products. Find a provider with a solid stock rotation program and a Web-based ordering and tracking system that keeps the brand in control of inventory. Freshness is critical with makeup, skin care and fragrance products, so a brand needs to be able to monitor its products’ best buy dates in real time. Retailers order quickly and stock smaller and smaller inventories, so providers must be able to cross dock and handle the occasional pick and pack order as well. And brand owner’s shouldn’t forget to ask whether they routinely keep strongly-scented items apart to prevent cross contamination.

Finally, brands also have an opportunity to cut transportation costs and keep rising fuel costs at bay. Small brands, too, can level the playing field between them and larger competitors by joining a retailer consolidation program such as those at logistics providers such as CaseStack, Hanson Logistics and Millard. As part of such a program, a brand’s product is combined with other products all requested by the retailer in a master purchase order. The brand’s would-be “less-than-truckload” (LTL) order is then shipped on a full truck, affording a cost savings. This also shortens delivery times, improves lead times and reduces potential damages. The resulting savings can be applied to shelf price, demonstrating to consumers that, as a brand owner, you believe in reducing excess and believe in passing the savings on to consumers.

Suppliers and manufacturers experience conservation in the form of reduced transportation costs and the brand no longer has to sacrifice service levels. “That old mantra of cutting quality or distribution for the sake of transportation costs is over,” says Dan Sanker, CEO, CaseStack. “When you join a consolidation program, the provider works directly with the retailers. [Transforming] LTLs into full trucks, for example, cuts costs by 20–40%. On-times increase 20% and millions of pounds of carbon emissions are taken out of the equation.”

Advanced Beauty Systems, a CaseStack consolidation customer and beauty care supplier, has saved thousands of dollars in damages and cut more than 67.7% of its carbon emissions. With consolidation, the company is realizing both monetary and environmental benefits.

The emphasis of going green stems from the need to do more with less, and packaging is a perfect platform upon which to show that you understand and appreciate the way that concept has affected your consumer. By retooling packaging’s look, structure and delivery, a brand owner stands to simultaneously improve the consumer’s first impression, save money and improve sales.

Elizabeth Abrams is the marketing associate at CaseStack—where she handles the public relations, advertising, marketing and business intelligence strategies for the rapidly growing provider of sustainable logistics solutions. A substantial background in journalism and advertising brought her to CaseStack, where she has worked since 2008.

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