Packaging has long been a key part of brand building, but how often does packaging really make a difference in sales or customer acceptance? Shoppers may have long since learned to recognize the red, white and blue logo of PepsiCo (NYSE: PEP), the yellow and blue design of Kraft's (NYSE: KFT) Mac & Cheese and the red and white of Campbell Soup (NYSE: CPB), but how often does a clever package prompt shoppers to pick up a new product?
Cost Versus Practicality
There are actually numerous websites out there devoted solely to cataloging innovative, quirky or striking packaging for all manner of consumer goods. However, the special packaging was intended to be a limited special run designed to create a buzz, or it was only found with small artisan outfits that sell at a much higher price point than the local supermarket.
So, while there are indeed a host of clever packaging ideas out there, including energy drink bottles shaped like light bulbs, a butter condiment container with a knife-shaped cover/spreader and fruit juice containers formed with the shape and texture of the fruit in the bottle, these were never intended to drive large-scale consumer adoption.
However, here are a handful of examples of innovative product packaging designs that actually were intended to drive product adoption in the mass market.
Owned by German company Wild and distributed in the U.S. by Kraft, Capri Sun was far from the first juice product to hit the market, nor was it even the first single-serve container. What made Capri Sun stand out was its shiny metallic pouches that not only grabbed the attention of children, its target market, but also were easy to pack in a lunch bag. Luckily for Capri Sun, rivals have found the pouches relatively difficult to produce, so the company still stands out from the competition with its packaging.
Capri Sun isn't the only beverage product that Kraft markets with a distinctive package. The company's MiO beverage additives not only come in distinctive modern-looking packages, but the containers are highly portable, re-sealable and allow users to control how much product they use. In less than one year on the market, Kraft posted over $100 million in sales from this new product, though drink mixes and water additives have been available for close to 100 years.
Next to electricity, coffee is the fundamental energy source for most offices, but battles over who makes the coffee and what coffee to make led many companies to just do away with coffeemakers altogether and let their employees seek out the nearest Starbucks (Nasdaq: SBUX) for their caffeine fix.
Then along came Keurig (now owned by Green Mountain Coffee Roasters (Nasdaq: GMCR) and its patented K-Cup). K-Cups not only allow for single-serving beverage production with minimal effort or mess, but also a wide array of product choices. The convenience of the K-Cup concept allowed Green Mountain to carve out meaningful share in the coffee market, while also licensing the technology to other coffee, tea and hot beverage makers.
Once part of Procter & Gamble (NYSE: PG) and now on its way to Kellogg (NYSE: K), Pringles did almost everything a little differently. Supposedly, P&G was bothered by complaints about broken or stale chips, as well as customers feeling cheated by the empty air space left after a bag had settled. As a result, the company set about to create a different sort of potato chip and potato chip container.
Pringles are not technically potato chips (they're fried potato dough), but they stack quite neatly into the re-sealable paperboard tubes that have become the signature of the brand.
At nearly $100 billion in annual sales, there's no question that the U.S. beer market is huge and intensively competitive. Beer companies are very reticent to try to gain share by changing recipes, due to the risk of alienating existing customers, and so they often turn to marketing and packaging to try to drive sales gains.
Bottling beer didn't start in any real volume until near the end of the 19th century, with canning coming later in the mid-1930s. Since then, companies have tried to pull share by claiming better flavor (Coors' Keystone brand boasted "bottled beer taste in a can"), special temperature-sensitive labeling (that changes color with temperature), specially shaped bottle necks (from SABMiller) and now new "punch-top" cans that offer an easier pour.
Not all packaging innovations boost sales the way management intends. PepsiCo has always tried to market its Sun Chips line with an eye toward overall healthier living. Taking that to its logical conclusion, Sun Chips launched a new packaging in 2009 that used fully biodegradable, plant-based materials. Unfortunately, this packaging produced an unacceptable level of noise and the company pulled it in just a year and a half. Since then, the company has relaunched the concept with modifications designed to reduce the noise.
The Bottom Line
It's easy to dismiss clever packaging as a gimmick, but the reality is that companies have to find whatever advantage they can in the market. Unfortunately, packaging can be tricky to patent or otherwise protect, and many packaging innovations are made (not surprisingly) by packaging companies that have little interest in tying it to just one company or product.
Originally posted on Investopedia.com