Creating Competitive Advantage with Product Packaging
Packaging and packaging design have become an important factor in marketing diverse “consumer goods” and have a key role in communicating product benefits to the customer. Product packaging is therefore also related to other variables in the marketing mix (Czinkota and Ronkainen, 2007). These are within the control of the company and are means of meeting changes within the business environment (Cateora and Ghauri, 2000). However, packaging design is subject to a complex set of influences from the business environment. Among the main influences, new technology, materials development, logistic requirements, environmental issues, consumer preferences and marketing aspects all play a key role for management decisions on marketing strategy (Packaging Federation, 2004a, b). The importance of the different variables varies among the actors through the supply chain, but is also linked with consumer concerns and product safety.
This paper therefore addresses the way packaging design can be used to meet new challenges within a supply chain. The paper describes and analyses factors driving packaging design and thereby derives suggestions for achieving competitive advantage within a rapidly changing and complex supply chain.
In order to reveal such complexity and focus on the role of packaging design, we have first had to discuss issues regarding different driving forces within the “packaging market” and second to develop a framework for analysing the interface between packaging and driving forces within the area studied. The analytical problems are inherent in the “packaging market” since the latter can vary with the packaging material. A change in packaging material at the retail level may be of minor importance, but have a great influence in terms of substitute products or new entries on the supply side of the packaging industry. A sudden change in attitudes among end consumers influenced by the media can therefore lead to a shift in the actual consumption between plastics and paper board materials and have strategic effects on the packaging industry.
There are a number of demographic and lifestyle factors, documented by scholars and companies, that have resulted in various changes in consumer behaviour (Hogg, 2003). The consequences of demographic factors are an ageing population and an increasing number of people living in smaller households. These changes in household size and composition are mirrored in changes in consumer lifestyle. The number of people eating out has also grown to a considerable size in western society (Packaging Federation, 2004b). New services and take- away facilities are adding to changes in consumer behaviour. “Healthy eating” and sporting activities to take care of your own health are other phenomena in our society. Low cost air-fares and more holidays have also contributed to new consumption patterns. Credit is widely and easily available and consumers are not willing to save before the purchase even if it is a capital product. These changes in household size and lifestyle have important consequences for consumer behaviour, which also affect the packaging industry.
Changes in consumer demands and requirements of products and services have put pressure on suppliers to come up with new solutions (Hogg, 2003). This has also been reinforced by strong competition in many product areas. Product and market managers in retailing have pushed for new designs and higher quality of printing giving their packages luxurious or prestigious appeal.