At a recent conference I was asked if the time, incremental cost and effort invested in value-added packaging (VAP) is of consequential value. I answered with a question; “value to whom”; the consumer, retailer or the marketer?”
Essentially VAP refers to the nature of a package; be it spirits, fragrance, cosmetics, or any luxe brand that projects an enhanced perception or bonus beyond the everyday retail offering. The definition is as varied as the budgets and margins within consumer product categories, and the term is usually applied to premium, super-premium, or ultra-premium offerings.
Value-added packaging, is about injecting energy and fostering Equity in your brand; igniting momentum and supporting organic growth. It is an investment in one of the many segments of your brand strategy. It is not about building volume or case count during one particular promotional period.
The package becomes an exclusive bit of parking space on the shelf, creating an environment surrounding and amplifying premiumness.
Luxury brand teams have larger funding to support their image with upscale materials, molded hi-touch plastics, wood, leather and fabrics. The value-added packaging world also includes branded giftware accompanying the product.
Consumers are challenged by an array of competitive options, private labeling, and an indistinguishable number of skus.
WHAT’S COMPELLING HERE?
46% of the $66 billion retail revenue (data will vary) “occurs” during holiday and summer promotional periods; the prime occasions for gatherings, parties and celebrations with large groups of potential brand advocates.
The point of sale is the culminating site of all prior brand building activity on the shoppers’ path to purchase: print media > cable > streaming > social > PR > events> retail purchase – The penultimate opportunity to retain and accrete brand equity.
Gift packaging at brick & mortar is an essential, logical, holiday / summer gifting location for the impulsive shopper.
Here stands the final battle for brand loyalty: creating it, reinforcing it, retaining it and vying for cross-over share from your competition.
I SUGGEST A SUPERIOR ACRONYM FOR VAP: BĒP– THE BRAND EQUITY PACKAGE:
1. Reward your loyal advocates who have been purchasing the basic product throughout the year.
2. Create incremental facings and table space at retail with innovative, exciting product offerings.
3. Amplify brand equity, generate brand awareness, and encourage cross-over from your competitors’ share.
THE ESSENTIALS FOR A BRAND EQUITY PACKAGE:
- The pieces and senses must play in harmony.
- The brand must be executed as real, believable and authentic; conveying ‘premium’.
- Capturing the shoppers’ eye during that critical 4 seconds.
- Conveying an emotionally engaging experience within a very crowded environment, amplifying your distinct presence.
- Seeking distinctiveness, style and a separation from the “others”.
QUESTIONS:
- Will your brand and your company lose share, loyalty, equity, and momentum by not participating aggressively with the competition?
- Does the Brand Equity Packaging convey your company’s depth of conviction and the value it places on its product?
- What is it about your presentation that stands out and upstages the competition to the right and left?
- How does the Brand Equity Packaging (BĒP) inspire your advocates, and to what extent is it also attracting your competitor’s franchise?
- Does it fortify your story and work in lock step with the energy your team has invested in every component of the marketing endeavor?
- How do you successfully execute this final touch point within your product’s unique voice, with phenomenal impact, brand recognition, and instant engagement?
- How do you close the deal? – All within a synapse.
ISSUES:
- The question of cannibalizing the sale of the basic product, thereby reducing margins vs. building brand resonance, equity and market share.
- Recognizing that the incremental spend on BĒP, factored into your Cost Of Goods Sold is primarily a brand / marketing investment that is supporting the entire ‘Go To Market’ strategic plan. The incremental spend should be viewed, analyzed, and segmented akin to print, viewing media, social spend and events.
- Recognizing and factoring in brand interdependence on a global scale, and brand independence with the local sphere.
- Making informed decisions, not solely on sell-in, but with available analytics on your demographics’ habits and trends.
- Ensuring ideation, options and design for the package are executed with serious, innovative, and creative intent; with all stakeholders driven to disrupt the category.
- The ability, budget and adequate lead-time to offer innovative concepts to the marketplace.
Extraordinary package design and brandware can alter the complexion of an entire category.
Precisely designed and executed, your package will profoundly impact brand identity.
Norman Kay is the CEO and Chief Creative Officer and inspiration behind IBC Shell’s creative intuition and market influence. He has directed award-winning packaging and branded consumer identity products for established global brands including Grey Goose Vodka, Estee Lauder, Chivas Regal, Swiss Army, Victoria’s Secret and Bombay Sapphire Gin. Norman’s work has received The Global Design & Advertising Award, The American Graphic Design Award, The International Award of Excellence for Visual Arts, and The American Packaging Design Award. He has lectured and authored articles on design, packaging technology, the magnetic forces of packaging, and amplifying the brand experience.