How Can Companies Use Packaging, Labeling, Warranties, and Guarantees as Marketing Tools?

Some product packages—such as the Coke bottle and Red Bull can—are world famous. Many marketers take called packaging a fifth P, along with price, product, place, and promotion. Most, however, treat packaging and labeling equally an element of product strategy. Warranties and guarantees tin can too be an important part of the product strategy and often announced on the bundle.

i. PACKAGING

Packaging includes all the activities of designing and producing the container for a product. Packages might have up to three layers. Cool Water past Davidoff For Men cologne comes in a bottle (primary package) within a cardboard box (secondary package), shipped in a corrugated box (shippingpackage) containing half dozen dozen bottles in paper-thin boxes.

Packaging is important considering it is the buyer's showtime encounter with the production. A proficient package draws the consumer in and encourages product option. In upshot, it tin can act as a "five-second commercial" for the product. It also affects consumers' later production experiences when they open it and use what's inside. Some packages can fifty-fifty exist attractively displayed at domicile. Distinctive packaging like that for Kiwi shoe polish, Altoids mints, and Absolut vodka is an important part of a make'southward equity.

Several factors contribute to the growing use of packaging equally a marketing tool. ^[1]

Cocky-service. In an average supermarket, which may stock 15,000 items, the typical shopper passes some 300 products per minute. Given that 50 percentage to seventy per centum of all purchases are made in the shop, the effective package must perform many sales tasks: attract attention, describe the product'south features, create consumer confidence, and make a favorable overall impression.

• Consumer affluence. Rise abundance means consumers are willing to pay a niggling more for the convenience, appearance, dependability, and prestige of improve packages.
• Company and brand image. Packages contribute to instant recognition of the visitor or brand. In the store, they can create a billboard effect, as Garnier Fructis does with its bright green packaging in the hair care aisle.
• Innovation opportunity. Unique or innovative packaging tin bring big benefits to consumers and profits to producers. Companies are e'er looking for a way to make their products more convenient and easier to use—frequently charging a premium when they practise then. The SC Johnson Smart Twist Cleaning System has a hand­held sprayer and carousel that rotates between concentrated versions of three different cleaning products; Kleenex paw towels employ a dispenser that fits upside downwards in a bathroom towel rack; and Kiwi Express Shine shoe polish has a dispenser and applicator to shine shoes without the need to spread paper, wear a glove, or use a brush.⁸³

Formally, packaging must attain a number of objectives:

1. Identify the brand.
2. Convey descriptive and persuasive information.
3. Facilitate production transportation and protection.
4. Aid calm storage.

To achieve these objectives and satisfy consumers' desires, marketers must cull the functional and aesthetic components of packaging correctly. Functionally, structural design is crucial. The packaging elements must harmonize with each other and with pricing, advertising, and other parts of the marketing program. Artful considerations relate to a package's size and shape, material, color, text, and graphics.

Color is a especially important aspect of packaging and carries dissimilar meanings in different cultures and marketplace segments. As i expert says, "Color is all-pervasive. It is language-neutral, simply loaded with significant. It's completely overt, yet each person sees colour through different eyes, both literally and figuratively."⁸⁴

Color can define a brand, from Tiffany'south blue box to Cadbury's imperial wrapping and UPS'due south dark-brown trucks. Orange, the telecom mobile operator, uses color as both its name and its look. Table 13.3 summarizes the beliefs of some visual marketing experts near the role of colour in Western culture.

Packaging updates and redesigns can occur ofttimes to proceed the brand gimmicky, relevant, or applied. Although these changes can have immediate impact on sales, they also can have a downside, every bit PepsiCo learned for its Tropicana make.⁸⁵

TROPICANA PepsiCo experienced great success with its Tropicana brand, acquired in 1998. Then in 2009, the company launched a redesigned package to "refresh and modernize" the brand. The goal was to create "emotional attachment by 'heroing' the juice and trumpeting the natural fruit goodness." Arnell Grouping led the extreme makeover, which led to an entirely new await, downplaying the brand name, highlighting the phrase "100 percent orange pure & natural," and replacing the "straw in an orange" graphic on the forepart with a shut-upwardly of a glass of orange juice. Consumer response was swift and negative. The package was deemed "ugly" or "stupid," and some even dislocated the product with a store make. Sales dropped 20 percent. Afterwards just two months, PepsiCo management announced it would revert to the old packaging.

After the visitor designs its packaging, it must test information technology. Engineering tests ensure that the package stands up under normal conditions; visual tests, that the script is legible and the colors harmonious; dealer tests, that dealers notice the packages attractive and easy to handle; and consumer tests, that buyers volition respond favorably.

Although developing effective packaging may crave several months and several hundred thousand dollars, companies must consider growing environmental and safety concerns most excess and wasteful packaging. Fortunately, as discussed to a higher place, many firms take gone "green" and are finding artistic new ways to bundle their wares.

Dell introduced bamboo packaging as an alternative to corrugated cardboard, cream, molded newspaper pulp, and plastic and took other steps to reduce the overall volume of packaging used.⁸⁶ Developmental environmentally friendly packaging that also satisfies customers' needs can be challenging, equally Frito-Lay found out.⁸⁷

SUN CHIPS Frito-Lay'southward Lord's day Chips multigrain snacks, containing 30 pct less fat than spud chips, take succeeded as a healthier, "salubrious" snack option. Part of the firm's endeavour to also support a "healthier planet" was to to run its manufactory in Modesto on solar power and unveil a novel 100 percent compostable bag made of plant-based materials. Much enquiry went into the development of the bag, and it was launched with fanfare in 2010. Unfortunately, it included polymers that made it "kind of crispy and crunchy" at room temperature, and consumers began to complain about how noisy it was. I Air Force pilot said it was louder than the cockpit of his jet. To show his point, he squeezed the new Sun Fries bag and recorded a 95-decibel level with a sound meter, considerably more the 77-decibel level recorded when he squeezed a conventional Tostitos bag. When thousands of people chose to friend a Facebook folio called "Sorry But I Can't Hear Y'all Over This Dominicus Chips Bag"—and with sales sliding—Frito-Lay decided to drop the bag later on an 18-month run.

two. LABELING

The label can exist a simple fastened tag or an elaborately designed graphic that is part of the package. It might carry a great bargain of information, or only the brand name. Even if the seller prefers a simple characterization, the law may require more.

A label performs several functions. First, information technology identifies the product or make—for example, the proper noun Sunkist stamped on oranges. It might also form the product; canned peaches are grade-labeled A, B, and C. The label might describe the product: who made it, where and when, what it contains, how it is to be used, and how to use it safely. Finally, the characterization might promote the product through bonny graphics. Advanced engineering science allows 360-caste shrink-wrapped labels to surround containers with brilliant graphics and suit more production information, replacing glued-on newspaper labels.

Labels eventually need freshening up. The characterization on Ivory soap has been redone at to the lowest degree eighteen times since the 1890s, with gradual changes in the size and blueprint of the letters. As Tropicana found out (see above), companies with labels that have get icons need to tread very carefully in order to preserve fundamental branding elements when under­taking a redesign.

A long history of legal concerns surrounds labels and packaging. In 1914, the Federal Trade Commission Act held that imitation, misleading, or deceptive labels or packages constitute unfair contest. The Fair Packaging and Labeling Human activity, passed by Congress in 1967, prepare mandatory labeling requirements, encouraged voluntary industry packaging standards, and allowed federal agencies to set packaging regulations in specific industries.

The Food and Drug Administration (FDA) has required processed-food producers to include nutritional labeling that clearly states the amounts of protein, fat, carbohydrates, and calories contained in products, every bit well as vitamin and mineral content equally a percentage of the recommended daily assart.⁸⁸ The FDA has also taken action against potentially misleading uses of such descriptions equally "light," "high fiber," and "depression fat."

Not all countries apply such strict definitions. In the United Kingdom, "light" and "light" exercise not accept an official meaning in police force, though "low fat" does—the food product must exist less than iii percent fat to qualify. As a result, some foods branded "lite" there take been found to contain upward to seven times more fat than those described as "depression fatty."⁸⁹

iii. WARRANTIES AND GUARANTEES

All sellers are legally responsible for fulfilling a buyer's normal or reasonable expectations. Warranties are formal statements of expected product performance past the manufacturer. Products under warranty can be returned to the manufacturer or designated repair center for repair, replacement, or refund. Whether expressed or implied, warranties are legally enforceable.

Extended warranties and service contracts tin exist extremely lucrative for manufacturers and retailers. Analysts guess that warranty sales accept accounted for a big percentage of Best Purchase'southward operating profits.⁹⁰ Despite testify that extended warranties exercise non pay off for them, some consumers value the peace of mind.⁹¹ These warranties still generate multibillion dollars in revenue for electronic goods in the United States, though the total has declined as consumers have get more than comfortable seeking solutions to technical problems online or from friends.⁹²

Many sellers offer either full general or specific guarantees. A company such every bit Procter & Gamble promises general or consummate satisfaction without being more specific—"If you are not satisfied for any reason, return for replace­ment, exchange, or refund." A. T. Cross guarantees its Cross pens and pencils for life. The customer mails the pen to A. T. Cross (mailers are provided at stores), and the pen is repaired or replaced at no accuse.

Guarantees reduce the buyer's perceived run a risk. They suggest that the product is of high quality and the visitor and its service operation are dependable. They tin can be especially helpful when the company or production is non well known or when the product'south quality is superior to that of competitors. Hyundai's and Kia'southward highly successful 10-year or 100,000-mile power railroad train warranty programs were designed in part to assure potential buyers of the quality of the products and the companies' stability.

Source: Kotler Philip T., Keller Kevin Lane (2015), Marketing Direction, Pearson; 15th Edition.

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