Everything you need to know about what is packaging in marketing. Packaging may be defined as the general group of activities in the planning of a product.
These activities concentrate on formulating a design of the package and producing an appropriate and attractive container or wrapper for a product.
The container itself can act as a forceful though silent and colourful salesman at the point of purchase or an effective medium of advertisement encouraging impulse buying. Many a time, package design itself can act as a registered brand.
Packaging is aimed at attaining two basic functions, the first to protect the product and the second to promote the product.
According to Philip Kotler “protection, convenience and economy were the three traditional purposes attached to package.” But in this modern era, we need to add all the modern functions of packaging.
1. Meaning of Packaging 2. Classification of Packaging 3. Functions 4. Essentials 5. Attributes 6. Packaging Cost 7. Packaging Strategies
8. Requisites of a Good Package 9. Factors Affecting 10. Significance of Societal View of Packaging 11. Consumer Problems.
What is Packaging in Marketing: Meaning, Classification, Functions, Essentials, Attributes, Packaging Cost and Consumer Problem
- Meaning of Packaging
- Classification of Packaging
- Functions of Packaging
- Essentials of Packaging
- Attributes of Packaging
- Packaging Cost
- Packaging Strategies
- Requisites of a Good Package
- Factors Affecting Packaging Decisions
- Significance of Societal View of Packaging
- Consumer Problems with Packaging
What is Packaging in Marketing – Meaning
Once the decision is taken on the brand, we have to consider the design and the make-up of the package and the labelling of the package. Branding, packaging and labelling are distinctly specialised activities, demanding the services of advertising experts. In reality it is not the product which is displayed and sold but it is the brand together with the package and the label which are sold or which enable to sell the product. In a sense your brand, package and label represent your product.
Modern methods of packaging are valuable to the manufacturer to establish his branded products as distinct from those of his rivals. The more effectively a product is packaged the more effective is its identity and individuality. Package is advertising on the shelf, a means of attractive display in the retailers’ shops. Packaging alone makes possible branding and advertising of products e.g., tea, soap, cosmetics etc.
Packaging may be defined as the general group of activities in the planning of a product. These activities concentrate on formulating a design of the package and producing an appropriate and attractive container or wrapper for a product. The container itself can act as a forceful though silent and colourful salesman at the point of purchase or an effective medium of advertisement encouraging impulse buying. Many a time, package design itself can act as a registered brand.
Almost every article has to be packed to make a trip to the ultimate consumer. But packing is merely a physical action and provides a handling convenience, e.g., wheat, cotton, etc. Packing is necessary to prevent flowing out of such liquids as milk, drinks, etc. It is essential to maintain freshness and quality, e.g., ghee, sauce, etc. It can prevent the danger of adulteration, e.g., butter, cheese, spices, edible oil, etc.
However, packaging is much more than mere packing. Packaging is a marketing necessity. The public does not want just the product. It wants explanation, assurance, encouragement, confidence and praise, i.e., pat-on-the-back, all integrated or combined with a pleasant and eye-catching get-up or appearance on the top to gain action, i.e., close the sale- Thus, a good package ensures ultimate success of the product as a commercial venture.
Package is an invaluable aid to decision-making by the customers. Under keen competition the consumer needs an effective means to recognise a difference and establish preference that will ensure repeated repurchases. Packaging does this job in a competitive market. That is why millions of rupees are spent on packaging and branding. Such huge expenditure is made for the simple reason that packaging and branding alone can sell your products. In fact, the amount spent on packaging is more than that poured into advertising. Packaging completes the sales cycle triggered by advertising.
In the present age of consumer-oriented marketing approach (i.e. Buyers’ Market), packaging has gained unique importance. The utility reasons for packaging, viz., protection, identification and convenience are themselves exploited in selling and some features of the package may serve as a sales appeal, e.g., a reusable jar. Message on the label is a constant reminder to the user of the product. Packaging decorates and beautifies the product so as to lead the consumer to impulsive buying.
Thus, the package serves in most cases as a vehicle by which the brand of the product is carried through to the consumers. In modern self-service stores, with mass display, well-designed packages attract attention, and through silent sales talk increase the sales volume. Packaging itself is a device of sales promotion.
A customer will pay more just to get the special package—even though the increase in price exceeds the additional cost of the package, e.g., Supreme Lux Soap sold in an attractive re-usable box for lunch or tiffin. In short, packaging is an advance stage of packing and it demands the services of experts. It has assumed a specialised status in the process of marketing.
What is Packaging in Marketing – Classification: Family Packaging, Re-Use Packaging and Multiple Packaging
Kinds or methods of packaging will depend largely upon the nature of the contents in terms of their value, physical composition, and durability. The length of the distribution channel, the amount of handling which the container will receive, and variations in climatic conditions which may be encountered between the point of manufacture and sales are also to be taken into account.
For example, liquid products require containers made of glass or plastics. Generally, electrical appliances require tin sheet containers. Similarly, for fragile (i.e., easily breakable or damageable) articles, wooden containers may be used.
Packaging may be classified into three categories as follows:
1. Family Packaging:
When the product of a particular manufacturer is packaged in an identical manner, it is known as family packaging. The size, shape, colour, etc. of the packages will be similar for all his products. “Family brands” are made meaningful by using family packaging also. In such cases, packaging methods, materials used for packaging, the appearance, etc. will be one and the same for all the products of a firm.
2. Re-Use Packaging:
Packages that could be used for some other purpose after the packed goods have been taken out or consumed, fall under the re-use packaging. Vegetable oils, and wellness drinks are being sold in re-usable plastic containers of different shapes. Reuse packaging can increase the sales value of the product considerably.
3. Multiple Packaging:
It is the practice of placing several units in one container. For example, liquor industry uses multiple packaging.
What is Packaging in Marketing – 8 Important Functions: Containment, Protection, Identification, Convenience, Attractiveness, Promotional Appeal and a Few Others
Packaging is aimed at attaining two basic functions, the first to protect the product and the second to promote the product. According to Philip Kotler “protection, convenience and economy were the three traditional purposes attached to package.” But in this modern era, we need to add all the modern functions of packaging.
Following are the functions of packaging:
Packaging performs the basic functions of providing a container for a material. For example- consumer durables like televisions, refrigerators, washing machines, etc. are packed in cardboard cartons, vegetables, fruits and milk are packed in plastic cover. Beer and Milkmaid is packed in cans which are easy to open.
Thus, the utilitarian function of packaging has the following advantages:
1. It protects the products from deterioration, spilling, spoilage and evaporation during its transit from manufacturer to consumer.
2. It enhances product use and convenience by keeping the contents clean and undisturbed.
3. It helps easy brand identification.
4. It makes product handling easier and safer to exhibit in super markets.
Goods are to be transported from the place of manufacture to the ultimate consumer. This involves several types of risk. Packaging helps protect the goods from damage during transport and warehousing. It also removes the hindrance of risk by keeping goods safe and free from spoilage. Thus packaging helps make the transporting of goods easier and safer.
Packaging helps to distinguish from one brand to another. It is mandatory that packages contain the name of the product, the maker, the ingredients, date of manufacture, expiry date, etc.
This function of packaging has the following advantages:
1. Packaging makes product identification and differentiation both easy and effective. In a competitive market, unique presentation makes products look different from competing brands.
2. Package features communicate the product message and motivate consumers to buy the product.
Wholesalers, retailers, middlemen, warehouse keepers and consumers demand convenience in packaging i.e. they should be light-weight and conveniently packed so as to be carried by hand. For example- Amul Mithai Mate is packed in an aluminum container in an easy to open form. Similarly, ten tablets of Crocin are packed in a strip and soft drinks are packed in a glass bottle with lift off caps that required a bottle opener. These have also evolved to non – returnable, unbreakable aluminum cans.
Packaging enhances the appearance of the product. The design, colour, label, printed matter, picture etc. all add value to the packaging. For example- chocolates are always packed in attractive packets and displayed to attract the target group.
Products must sell themselves. This is possible, if they are placed in more attractive and eye – appealing packages. This has resulted in a number of innovations which appeal to the consumers. For example- Nescafe, Boost, Horlicks, etc. are now available in attractive glass jars.
Nowadays several companies aim at providing “re – useable container”, once the product have been completely used. For example- health drinks like Boost, Horlicks, Nescafe, Pickles, Jams, etc. are sold in glass bottles that can be used for storing provisions in the kitchen. If not, they can be sold as scrap.
Packaging should not create a financial burden for the company. Consumers prefer economical packaging options, because the packaging cost is included in the cost price. Hence, the packaging should be made attractive, appealing and economical.
What is Packaging in Marketing – Important Essentials: Protection, Dependable, Ease in Heading, Easy Identification, Convenience, Reasonable Cost and a Few Others
From the seller’s point of view:
1. Packaging is a sales tool,
2. It identifies the maker as well as the product and carries the brand name,
3. The package label informs the buyer about inner contents and how to use them.
4. It is the biggest advertising medium.
5. It moves the product at the point of purchase.
6. It encourages impulse buying,
7. It establishes a product image, and
8. It identifies the product with advertising.
The following are the important essentials of packaging:
This is the fundamental function of packaging. The product demands protection until it is used or consumed. Package prevents damage or loss during transport and warehousing. Foreign trade without sound packaging is impossible. Air-tight package protects the quality of inner contents. Package can prevent the disappearance of volatile or gaseous articles, e.g, spirit, acid, gas, etc.
Truthfulness and honest representation is the most important function and quality of packaging. Consumers rely on the package itself for the quality of the product inside the packing
3. Ease in Handling:
Modern packaging facilitates easy handling and movement during the process of distribution.
4. Easy Identification:
Identification is an important function of packaging, following closely protection and ease in handling. Your product can be identified by a consumer from the rival’s because packaging creates individuality and helps quick identification. Packaging enables branding and advertising. The product gains special and separate existence due to branding and packaging.
Convenience in packaging is not simply a matter of customer service. Middlemen, wholesalers, retailers and warehouse-keepers, i.e., all agencies in the machinery of distribution, demand convenience. The size and shape of the package will determine the function of convenience, viz, adaptability.
6. Reasonable Cost:
Costly package may be needed for fragile and very valuable products. It may be good for goods bought as gift. But in general cost of package must be reasonable. Lighter but sturdy packages can reduce cost of transport also.
7. Attractiveness (Selling Tool):
Attractiveness is a major consideration in modern packaging. The design and the label on the package, printed matter, picture, layout or get-up of the package, colour combination, all these are special aspects of the package and act as selling points of the package. Package must have an artistic appeal. Picture on the package adds to the attention value by drawing and holding the onlooker’s eyes on it.
Prominent, clear and attractive advertising message given on the package label plays the role of a silent salesman—performing the functions of salesman— attracting attention, arousing interest, creating desire and gaining action (A.I.D.A. Formula). Promotional potency of packaging is tremendous. Packaging should be looked upon as a powerful tool of promotion just like other devices of promotion, e.g., salesmanship and advertising. Attractiveness, convenience of use and reusability are its significant demand creating factors. Reusable packages or containers encourage repeat sales through -refill packages.
What is Packaging in Marketing – 2 Major Attributes: As a Product and As a Medium of Communication
This can be divided into two heads, i.e. as a product and as a medium of communication.
As a Product:
1. It should protect the content from spoilage or breakage.
2. It should be easy to open, close, and dispense from.
3. It should be safe to use.
4. It should keep the product from deteriorating.
5. It should be of proper size and shape.
6. It should be reusable or be sold as a scrap.
7. It should be economical cost wise.
8. It should be available in sizes, appropriate to the market segment reserved.
As a Medium of Communication:
1. Packaging should be attractive.
2. It should project a favourable image of the product.
3. It should sell itself, i.e. it should play the role of a salesman.
4. It should be readily identifiable in a shopping situation.
5. It should act as a unique selling proposition.
6. It should have labels with the information, like date of manufacture, contents, net weight, expiry date, date of packaging, etc.
7. It should communicate on the usage of the product, precautions, benefits of the product, etc.
8. Lastly, it should not be deceptive or misleading in size, content, etc.
What is Packaging in Marketing – Types of Packaging Cost: Material Cost, Storage and Handling Cost, Packaging Operation Costs, Storage of Filled Packages and a Few Others
Various types of packaging cost are as follows:
i. Material cost:
It means the cost of the pack and quality control cost.
ii. Storage and Handling Cost:
This include the handling cost of bulky packages, heavy materials of construction, drums etc.
iii. Packaging Operation Costs:
This includes the cost involved in operations like, cleaning the package product filling – closing, labeling – unitizing, stenciling, handling cylindrical slums etc.
iv. Storage of Filled Packages:
This includes the cost incurred to shift the goods from one form of packaging to another.
v. Transportation Cost of Filled Packages:
This involves the transportation cost by sea, air etc. it depends on the size and volume of packages.
vi. Loss and Damage Cost:
It is related to the loss and damage during operation, transportation delivery etc.
vii. Insurance Cost:
It varies depending on the vulnerability of package, to cover the risk in transportation.
viii. Obsolescence Cost:
This cost involves when changes in the packaging materials, packages and labels happen.
ix. Package Developmental Cost:
This include the evaluation cost, pilot test cost, field testing cost, consumer research cost, feedback cost, final trial cost etc.
What is Packaging in Marketing – Packaging Strategies and Policies: Transit Packaging, Consumer Packaging, Protection Packaging, Multiple Packaging and a Few Others
Every producer adopts a certain policy or strategy. There may be different types of packaging policies and strategies and a producer has to select any one of them. Use of a particular policy depends upon the needs, requirements and circumstances of the producer.
Some of the important packaging policies and strategies are:
1. Transit Packaging:
Every producer has to deliver the goods to its real consumers. Delivery of a product from producer to the consumer is the process involving many activities. One of these activities is the transportation of the product from the place of producer to the place of the consumers. Product must be packed in a manner that it may reach to the consumer in original conditions. Such packaging of the product is called transit packaging.
Thus, transit packaging is that form of packaging which is meant to keep a product safe in the process of physical distribution. It is thus also known as “distribution packaging”. The materials generally used for transit packaging are the drums, wooden containers, tins, jute sacks, hardboard, etc. Main stress in this type of packaging is upon the safety of the product during transit.
2. Consumer Packaging:
The packaging in which the product is finally delivered to the consumers is known as consumer packaging. Material used for consumer packaging may be a bottle of glass or plastic, jar, tin, plastic box, hardboard box, polythene bags, etc. Main stress in this type of packaging is upon the attraction of packaging. Packaging must attract the attention of consumers and it must be convenient for consumer to handle.
3. Product Line Packaging or Family Packaging:
When a producer uses identical packaging for all the product items of a product line, it is called product line packaging or family packaging. This type of packaging is widely used by the producer of consumer goods and generally by the producers producing a large number of product items in particular product line. The best example of family packaging is packaging of shoes, slippers, etc. mainly by the producer of repute such as Bata, Liberty, Khadims, etc.
4. Protection Packaging:
The basic function of packaging is to protect the product form breakage, pilferage, theft, evaporation etc. Packing of the food items, medicines are done in such a way so as to protect it from moisture, sunlight and high temperature.
5. Multiple Packaging:
In this packaging strategy closely related products used by a single consumer are packed together. This strategy is economical and it also saves consumer’s time in buying different products. By packing different products in a single package, manufacturer saves packing material of different items and thus it is economical. Also consumer saves much time as he gets all the required items in one package. For example, pencil box contains pencil, pen, rubber, eraser, ruler etc.
6. Re-Use Packaging:
Here the goods are packed in such a package which can be used again after consuming the product. This strategy promotes economy in the use of the product and also promotes repeat purchase by consumer. It helps in reducing pollution caused due to used packages. Re-use packaging, thus preserves the physical environment by increasing the life of packages.
7. Kaleidoscopic Packaging:
Kaleidoscopic packaging is concerned with printing suitable and attractive cut-out figures, toy and cartoons on the package in order to attract the consumer and stimulate the demand. Pictures of fresh and juicy vegetables, fruits on ready to eat items give an impression of a healthy product. A healthy smiling child picture shown on various baby products signifies that the products will keep our child healthy.
What is Packaging in Marketing – Requisites of a Good Package: Suitability, Protective, Requirements of Consumers, Packaging Materials, Cost and a Few Others
Packaging is an important device of sales promotion. It acts as a colourful and silent salesman. It gives full information about the uses and features of the product to the users. It helps in giving individuality to the product. It may be noted that branding is not possible without packaging.
Both are interlinked. Brand name and mark are to be printed on the package to make the product easily identifiable by the customers. In other words, the package must tell the product story at a glance.
The basic purpose of packaging is to provide protection to the goods and to facilitate their easy handling and storage. But in the modern age of competitive marketing, packaging has assumed certain other objectives also. Packaging is used as a medium of publicity and as a silent salesman. It helps in preventing adulteration of goods and ensures their safety.
In order to achieve its objectives efficiently, a good package should possess the following features:
A package should suit the requirements of the goods to be packed in. That means the package designed should consider the size and quality of the product and the quantity to be packed in the container.
The package must be so designed that it protects the contents contained in it. Articles subject to deterioration in quality such as medicines, powders, acids, and edible oils require a special type of packaging. Wherever required, the package must protect its contents from sun, moisture, germs, etc.
3. Requirements of Consumers:
The same product might meet the requirements of different segments of consumers who have different levels of income. The package may be more attractive and costly for selling the product to affluent users. It should be quite economical for selling the product to the users of the lower income group. For instance, polythene bags have become quite popular with the manufacturers of Ghee for selling it in small quantities, say 1 Kilogram, to the customers from low and middle income groups.
4. Packaging Materials:
This factor is very important as it influences the cost of packaging. Materials to be used in packaging depend partly on the nature of goods and partly on its appealing power to customers. For instance sugar, food grains, cement, etc. are traditionally packed in gunny or jute bags and now in HDPE bags. Biscuits are packed in air tight containers or packets; so that they remain fresh, crisp and original in taste and flavor. Oils, Ghee, Jams, Pickles, etc. are stored in glass jars, metallic jars or tins.
Materials used in packaging industry include glass, aluminium paper, tin, paper and card boards, cellophane, plastic, polythene and gunny bags. Their relative merits and demerits in terms of cost, utility, customer appeal have to be analysed before choosing any of the above materials for packaging.
The cost of package is to be considered in the context of nature and value of article and the nature of buyers. As a general rule, articles of common use such as sugar, soap, tea leaves, cereals, etc. should be packed in low cost containers. Articles of high value and catering to the requirements of high income group such as cosmetics, jewellery, etc. should be packed in attractive and durable packages.
6. Attraction Value:
As far as possible, the package must possess attraction value. Design and label of the package, and the colour combination of the package are all important. Attractive packages earn reputation and increase sales and profits of the manufacturer. The use of a picture on the package is made quite often to attract the attention of people.
The picture and other information printed on the package should be suggestive of the contents and its characteristics inside. It should be ensured that there is maximum information in minimum words. Attractive packaging is not always costly. Even the low cost packages can be made very attractive. It depends upon the imagination of the designer.
7. Size and Shape:
The size and shape of packaging depends upon the type and value of product to a large extent. Size and shape of the package do add to its attraction value. They also facilitate proper display of the product at retail stores.
Durability of packages is also an important consideration. If a package is durable, it will be reusable even after the product has been consumed. For example, plastic containers of ghee, coffee jars and pickle jars are reusable. From publicity point of view also, such packages are quite useful.
What is Packaging in Marketing – Factors Affecting Packaging Decisions: Size, Shape, Colour, Material, Text, Brand Name and Cost
The following factors are to be considered while making packaging decisions.
a. Size – The size of the package should be convenient and handy for the customer. For example- soft drinks are available in 100ml, 200ml, half a litre, one litre, one and a half litre, etc.
b. Shape – The nature of the content determines the shape of the package. Moreover, it should be convenient and attractive to display in retail stores.
c. Colour – The colour of the package also plays a significant role in marketing decisions. The colour should be attractive, eye – catching and at the same time relevant to the contents of the package.
d. Material – The packaging material also needs careful consideration. The most commonly used packaging materials are metal, cardboard, aluminum foils, sack cloth, etc. But now, due to the growing importance of environmental protection, plastics are being used less frequently for packaging. Instead, environment friendly packaging materials are being used.
e. Text – Usually, some form information is communicated to the consumers through the package. Now, it is mandatory to give the statutory warning, date of manufacture, expiry date, contents, date of packing etc.; for example “This fairness cream is only for external use”, or “Alcohol consumption is injurious to health”.
f. Brand Name – The brand name should be prominently displayed on the package. The brand name differentiates a product from its competitive products. Hence, the package should contain the distinguishing brand name or brand label.
g. Cost – Packaging cost is added to the cost of production. Hence, the packaging cost should be economical and minimum, so that the consumers are not over charged. Moreover, the cost of packaging also affects the cost of transportation, handling, storage, etc.
What is Packaging in Marketing – With Significance of Societal View of Packaging
The various types of plastics have not only helped conserve or utilise the depleted natural resources but also revolutionised the concept of packaging. Plastics have proved to be much better substitutes to wood, cotton, metal, card board, paper, glass and so on.
The new rigid PVC now manufactured by modern, computerised and automatic process both in the normal and non-toxic grade with printability and metallizing property is going to revolutionise the packaging systems for medical and food sectors and for consumer and industrial usage by thermoforming and twist wrapping process.
In the Food Processing Industry the new plastic package offers strength, protection, presentation and consumer appeal. The recycling process of plastics right from collection of the garbage to segregation and conversion in prime form for reprocess and reuse has solved the problem of pollution. In India rag pickers contribute enormously to the estimated 40 per cent of plastic which is recycled.
The ‘re-use’ culture is more prevalent in India, where plastic containers are reused several times before they are discarded. If environmentalists believe that less plastics would mean less waste, a German study indicates that without plastics the weight of packing materials would be 300 per cent higher, the volume of waste 150 per cent higher and energy consumed by packaging at least 100 per cent higher. Plastic recycling has reduced substantially problem of waste disposal and environmental degradation due to packaging.
Social View of Packaging:
Significance of societal view of packaging is summarised below:
1. Pollution control is a burning issue in packaging particularly in Western countries. Broken bottles, crushed cartons, and bent cans litter the streets and choke municipal dumps. This has created the solid waste problem in those countries. All packaging programmes must weigh environmental and ecological issues.
2. Resource scarcity is another problem. The same precious natural resources that are being wasted on non-returnable (disposable) containers, e.g., soft drink bottles and beer bottles, later create litter and pollution problem. Such a consumption pattern cannot be tolerated now.
3. Among the resources which are being wasted, energy sources are the most critical at present. Throwaway bottles use three times the energy of returnable bottles. The efficient, energy-saving, returnable bottles must be introduced.
4. Nutrition labeling, open dating (how fresh is the product), unit pricing, and grade labeling are the latest demands of consumers on all food products.
What is Packaging in Marketing – Consumer Problems with Packaging
1. Unless the package is transparent, the buyer cannot judge the contents by appearance. If quality information on the package label is absent, the buyer has to purchase almost blindly.
2. If the consumer wants a specific quantity, he may not have that amount when goods are sold in packages.
3. There is no feasible way to check weight and volume of the contents unless a buyer opens the package to ascertain the weight. Prepackaged shortages amount to about 20 per cent.
4. Package sizes and designs inflate the contents. ‘One Rupee off’ labels proclaim price reduction which may not be real.
5. Deceptive packages have several room-mates in trade practices. They are hidden declaration of contents, fine print, glorified illustrations, unexplainable fractions (3-7/8 Kilograms) etc. Consumers think that they are getting more when in fact they may be getting less due to the cunning package design.
6. Packages are same, contents are reduced and apparently same prices are charged. This method is popular in a period of rising prices.
7. Packages may create health hazards for consumers. Certain plastic food packaging has been shown to cause cancer (vinyl chloride inhaled by humans). Packages stored in godowns are susceptible to infection (rodents and insects nesting in packages).
The Total Product Image:
Image means a mental picture drawn by a fancy. A product image is the sum total of- 1. Inner value of the product, 2. Its ability to perform and give service and safety to user, 3. Packaging, 4. Branding, 5. Labeling, 6. Product warranty, and 7. Product services. The product image also indicates the goodwill of the product and its producer.
In the product planning and development, we have to consider branding, packaging, labeling, warranty and services as these constitute the vital parts of marketing programme and these are closely interconnected in building up a bright product image in the market.
Pricing decisions have strategic importance in any enterprise. Pricing governs the very feasibility of any marketing programme. Because it is the only element in a marketing mix accounting for demand and sales revenue. Other elements are cost factors. Price is the only variable factor determining the revenues or income. A variety of economic and social objectives came into prominence in many pricing decisions. We now come to the most absorbing question of pricing.