Packaging Design and the year of the Water Dragon

Posted: February 6, 2012 in Index

2012 is the Chinese year of the Water Dragon, a symbol of good fortune in Chinese astrology, the year of the dragon bringing the Four Blessings of the East: wealth, virtue, harmony and longevity. So it seems fitting, that if I am to discuss what I believe should be the packaging trends for 2012, that I use the four blessings as my guide:

 Wealth:

In times of economic turmoil, of course we all hope that 2012 will bring more stability to the financial markets, but in packaging terms, perhaps we may interpret the term wealth to mean ‘value’. There is no doubt in my mind that in the past decade, the ‘value’ of packaging has increased enormously. From being the poor relation to the advertisement, packaging has now seen its role and importance grow and dominate the market. One catalyst for this change has of course, been the result of the rise of the retailers, who have, over time, dominated our high streets in just about every urban environment throughout the world. The retailer’s proximity and daily dialog with consumers has given packaging a crucial role in the decision-making behaviour of most consumers. We have known since the 70’s that two thirds of purchase decisions are made in store, but today, with so many stores, packaging and packaging design have reached a point where, for many products, it is the main builder of brand awareness and subsequently, value. This is what the retailers have understood so effectively.

 For consumers packaging has often ‘become the product’, as they experience packaging as a protector, a facilitator and a trustworthy and well liked friend, creating that strong and direct relationship between themselves and the brand. Yet, when I see how major manufacturers have demoted the importance of packaging in the marketing mix, and the resulting deterioration in the quality of most packaging design and communication, I begin to wonder if in 2012 there isn’t a real need for change in the way industry approaches packaging and packaging design, if in the end, we are to benefit from the dragon’s blessing of wealth.

 Of course, I’m not saying that there isn’t great stuff out there, a visit to packaging blogs will reveal a lot of innovative packaging design executed with great professionalism by very talented designers, but alas, nowadays, a visit to the supermarket, mostly will bring disappointment. The problem being, I believe, that major manufacturers have lost sight of the importance of the dialog that packaging has with their consumers, they have chosen to look at packaging purely as a cost rather that a builder of ‘value’, and as a result, they have taken the power to direct packaging out of the hands of marketing departments (where it belongs), and passed it over to the purchasing department, who’s only interest, is not the dialog that a brand and brand packaging has with consumers, but with getting packaging made cheaper.

 This, in most cases, has lead to inadequate design budgets; lower print quality and inevitably poor results. Moreover, it has led to the demise of many brilliant design companies who have been driven out of business, with the resulting sad loss of great design talent leaving the industry, only to be replace by design ‘factories’ churning out formulas and design clichés which, in turn, has lead to the situation we are in today.

 I suppose the major brands will say that, ‘whatever we are doing it’s working, today we are increasing sales and creating shareholder value by cutting costs. But hold on a minute! Let’s look a little further than just the yearly results. By doing this; we will get a clearer picture of what’s going on, we’ll see that in the past 60 years private labels have gone from nearly nothing to capturing an average of 50% of the market. This means that for brands, 50% of the market has been lost. Something then, is clearly going wrong with the current strategy, and it figures, that if a major brand has achieved any growth over this time, it must have done so, only at the expense of other brands, or by swallowing them up, or by having to go further afield to develop new markets….because any growth achieved is certainly not at the expense of the retailers!

 Looked at from this perspective, we see that the major brand companies have, it seems, become just bigger fish in an ever smaller pond. Mostly, I might add, living on the back of brands that were conceived and designed in the first half of the 20th century, when marketing and design were linked and many great things were achieved. Therefore, I think it’s obvious where this is leading, if we don’t re-assess the way we are doing things, we’ll end up with two or three brand companies fighting over a smaller and smaller pond, whilst next door, the retailers just keep on growing their market at the same steady rate they have over the past 60 years.

 There’s an old saying, ‘you can’t judge a book by its cover’, but in the world of branding totally the opposite is true, it is the ‘cover’, or packaging that positions, promotes, describes and enamours a product to a consumer, losing sight of this fact, I believe is a false economy that will come back and bite manufacturers where they won’t like it, through the loss of consumer loyalty and a resulting decrease in sales. Unless there is a radical change here, I can predict that in 2012, the market will continue in the same direction as previous years, with the continuing decline of brands and the subsequent rise of private labels. Clearly, it’s time to re-think and to create wealth, by adding value.

 Virtue:

There is no doubt that in many parts of the world, where choice exists, consumers are more and more aware of what they buy, what they eat, from where it comes and it’s effect on the environment. They are looking for the virtues of simplicity and honesty coupled with moral and ethical principals. When it comes to packaging this can be translated in many ways.

 Firstly there is globalisation. From a global standpoint, it’s clear that for many large manufacturers, having a global positioning and ‘one’ design offers enormous economies of scale allowing them to be competitive in the marketplace. However, although there are some brands that achieve this, for others it’s not so easy, the reason being that in the end ‘there is no such thing as a global consumer’. Because, whilst as a consumer, I can accept some products as being global, for example a bottle of Scotch Whiskey or an American hamburger, for many other products, I will be looking for something that responds to my ‘local’ needs, something that is meaningful to me, to my lifestyle and my place in the world.

 This leads me to conclude that in 2012, having suffered all the economic uncertainty of the past few years, consumers will, I believe, be looking for brand virtues that they can trust, and brands that speak their language, that talk to them honestly and directly.

 To this end, it seems to me to be totally crazy, that as we enter the year of the dragon, in a world where today, retailers are honing their offer to react to the smallest consumer need, watching how they shop, in each individual store, and addressing their offer accordingly, that major manufacturers are still looking to homogenise and create bland design solutions that maybe acceptable to all. Solutions, which in the end, carry no emotional communication or attempt to connect with a consumer’s personal lifestyle or the individual that is inside us all.

 On another level, virtue may of course, be translated as ethical responsibility, and I believe this is very relevant to the world of packaging and packaging design. Naturally as an industry professional, I am aware that many manufacturers are trying to make a bold effort to produce packaging that responds to the needs of our changing environment, there are many initiatives to downsize, light-weight and recycle where possible. Enormous amounts are being invested in creating facilities that will allow material to be re-used or re-allocated. But the simple truth is, it remains for the most part an expensive option and often the effectiveness of such ideas is extremely difficult to measure. I believe that cosmetic approaches like adding a carbon footprint to a package (where the measure of the beginning and end point are often hazy, to say the least), giving half-truths, misinformation or other ‘green-washing’ initiatives do nothing to help our industry, or to allow consumers have confidence in brands. What we need in 2012 is the virtue of an honest dialog with consumers. It’s time to come out and say what we can do and what we can’t and to have the courage, when necessary, to say we honestly don’t know.

 This is a period in the history of our world where, for good reason, people have lost confidence in many of the world’s leaders, and in the global economy itself, which is hardly surprising, when many are directly suffering the consequences of the financial meltdown. I believe that brands that use this moment to speak openly and honestly and allow their actions to be scrutinised, can only benefit, and bring the blessings of virtue upon themselves, as the year unfolds.

 Harmony:

One of the ways harmony can be promoted in the packaging industry in 2012, is for the key players to stop the in-fighting and posturing, and to begin to work together to bring new and innovative solutions to the fore. It has been and remains all too easy for the individual players to stand apart and play the blame game. The problem being, that up to now, there has been a real lack of dialog between each section of the industry. Here I believe the trade associations have a real role to play in 2012, working on a different level to the everyday commercial realities of the individual players, trade associations can, and should, be promoting this dialog and sharing knowledge, so that we can all benefit from new creative approaches and solutions to both our industry and society as a whole.

 In a world where more than 33% of food production is wasted, packaging has a chance to shake off the negative connotations associated with it’s production and disposal, and lead the way by promoting what we do well and bringing concrete solutions that will help food protection, delivery and storage. It is my firm belief that packaging can be part of the solution rather than continually being sited as ‘the problem’. I, and many others are more than convinced, that without packaging, food waste would most likely be even greater today. Sure, there is a long way to go, but with harmony and co-operation, who knows, we may yet see great leaps forward in 2012?

 Let’s hope that the blessing of harmony can bring great benefits, by encouraging us to harmonise the process and get the different sections of the industry to co-operate. In this way we may all improve the value chain and create effective and innovative results.

 Longevity:

It’s only natural that brands seek longevity, but what does that mean? For brands it’s really about building a long-term relationship with consumers, building trust and that means delivering a consistent message and a consistent product experience. The trouble is that, what brands use to have all to themselves in the past, has now been well diluted, all the colours and icons the product shots and moods have become generic and well used, to really good effect, by the private labels. So what’s a brand to do?

 My view is that if brands really seek longevity they have to do two things really well. First of all they need to realise that whilst the product is crucially important, it is in the end only a product, and as such it can be mimicked or even expertly copied by almost anyone.

 OK, I hear you say, that a Coke is a Coke and it can’t be copied, but it can and has been mimicked, and as a result, there are many other brands and private labels that prove my point, who have made good money from creating a similar brown sugary liquid that they also sell in a red labelled bottle! So, if a brand is to have longevity, it needs to concentrate not just on the quality of the product, but also on the consistency and promotion of its visual equities. I say ‘promotion’, because it’s not just about putting a logo or a swirly line on a pack, it’s about using these elements in every part of the brand’s communication campaign.

 This brings me back to my first point, discussed in ‘wealth’, and the importance of packaging design: Because in today’s market, I remind you, that it’s usually the packaging designers that create these original equity elements (and often define the brand positioning as well). Even more reason to re-consider the way Packaging Design is managed, because:

 ‘If Package Designers are the people who define your brands positioning and develop the icons and elements that will become the future backbone of all your communication, in 2012, do you really want the purchasing department to choose who you work with to develop your brand, making their evaluation only on cost?’

 My second point about longevity is about survival: as I mentioned, private labels have grown since the 1960’s and continue to grow on a steady upward trajectory, with no downturns, no blips or pauses. This then, is the real threat to the longevity of brands.

 Because private labels have adopted the communication tools of brands, it makes it clear that if brands are to survive in 2012, they need to adopt a different strategy. They need find new ground and to fight back with tools that can’t be used by their competition. This is why the equity elements of a brand are so fundamentally important, and why, brands need highly skilled packaging designers who can build into their brand designs, ownable visual cues that identify, position, represent the brand and create a clear point of difference, elements that can’t be copied, thereby securing the consumers understanding and trust and creating the desired longevity.

 As we enter the year of the water dragon, it’s worth remembering that it only comes around every 60 years, and whenever it does, there is always a paradigm shift, where society changes and the way we look at and do things is radically altered. This should be an interesting year!

 Kung Hei Fat Choi.

 Rowland Heming© 2012

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