Hit or Miss: How Package Design Can Impact Your Company Performance

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In the past few years, recent innovations in consumer package design have brought success to bold companies that made the decision to implement them. Everything from aesthetic appeal to sustainability has been taken into account, and successful implementation has brought tangible rewards for such companies in their respective industries. For example, the cosmetic company Pangea Organics found success in creating a sustainable package for their bar soaps, which has amaranth embedded into the package so that the wrapper sprouts when planted. Such innovations appeal to consumer interests and influence consumer purchasing decisions, which in turn can either make or break a company in overall sales. Understanding the importance of packaging design and optimization not only can increase sales, but can also create an effective competitive advantage for a company by driving down overhead costs for manufacturers in almost any industry. Proper maintenance of packaging specifications and design, if not handled properly, is detrimental to the success of a company. Such companies tend to overlook this very important aspect of their packaging.

Competitive Advantage

A surprising amount of companies give very little thought into the packaging of their products. Elisha Tropper, President and CEO of Cambridge Security Seals (CSS), states, “I have spoken with manufacturers of industrial products around the world, and for most of them, packaging is not even a consideration. They are manufacturers; they are not packagers. They make an industrial product, and industrial products are dumped into boxes. But whether the box is an inch bigger or an inch smaller, what does it matter?” This overall mindset may be hurting a company, who also may be spending large amounts of money on packaging materials without understanding why.

Despite this fact, there are also many companies that are viewing packaging as more than just protection or marketing for their products. Many company executives, like Tropper, take packaging optimization into consideration when measuring product success. They look into finer detail, taking into account things such as product design to develop packaging that sometimes require approximately half the packaging of its competitors. This ultimately results in a greater value for end users and a product with more premium presentation. These forward-thinking companies are specifically targeting competitive packaging, focusing not only on the performance of the product, but also of the package. Doing so has a substantial impact on customers, influencing their purchasing decisions in stores and online.

In the healthcare and pharmaceutical industry, companies are focusing more on package design to differentiate themselves from their competitors and improve brand recognition. Alan Davies, the Global Design Manager at Essentra, states, “What we are finding is that pharmaceutical firms are now looking to packaging as a way to differentiate themselves. They are open to working with external design studios to identify creative solutions that will help them differentiate their product and the way it is delivered to their end users.” For Essentra, they had been tasked with designing bold and innovative packaging in order to help professionals identify and access instruments out of bulk containers quickly and effectively. By focusing on package design, they were able to reap the benefits of their packaging innovation, creating a competitive edge in their respective industry by considering customer ergonomics and visual appeal.

Sustainability

When companies think “sustainability,” they tend to focus more on using biodegradable materials as a solution. According to the Environmental Protection Agency, every year packaging makes up one quarter of landfill waste, so it makes sense that the solution to reduce carbon footprint is to use more organic materials in packaging. However, the idea of sustainability also includes the concept of material reduction and processing, which can also have a large impact on a company.

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Global packaging material organizations are all working to constantly reduce, rework, recycle, recover or renew packaging materials, enabling a measurable reduction on the total global packaging carbon footprint. Many of these organizations have found that this is achieved at the point of packaging design. Choice of materials is very important, as well as choices of pack design, manufacturing processes, print method, and supply chain options. CSS has found success by reducing the size of their packages for sustainability purposes. Tropper states that although there may not be a significant reduction in plastic in their new designs, the more effective allocation of the resin in the overall structure has resulted in a better seal for the same material cost. As with the company’s corrugate, they may not have substantially reduced material costs, but by using smaller and more optimized packaging, it has offset the cost of carrying multiple box sizes and effectively reducing the cost of freight. Companies like CSS make packaging innovation a priority and find ways to reduce costs while still maintaining high quality standards.

The cosmetic industry is one such field where sustainability is progressively becoming a more widespread practice among many companies. Estee Lauder, a leader in the cosmetics industry, is actively redesigning products to reduce material while still delivering quality products. John Delfausse, Estee Lauder’s chief environmental officer for corporate packaging, states, “We can make small redesigns in the packaging that have a huge impact the consumer may not even notice.” For example, “light weighting”, or slimming the shape and weight of a bottle, tube or jar while maintaining the same volume of product, has been a common practice with Estee Lauder products. Such practices are building steam throughout the entire industry.

Sustainability is not a recent idea when considering product packaging, but is definitely a growing concern for many companies. Increasing amounts of companies are focusing more on packaging sustainability in addition to their manufactured products, and are being rewarded for their efforts with reduced costs and higher sales by more environmentally concerned customers. Sustainable packages are a growing sector in many types of industries and are becoming more common as time goes on.

Consumer Impact

Consumer impact is largely concerned with how a consumer perceives a product, and product packaging plays a large role in this. As Tropper states, “While it might seem strange to be concerned about the quality of packaging for an industrial product in a simple corrugated box that’s rarely seen before being purchased, the fact is that these products are used by people and by companies, and the packaging is seen by the users. It is a functional package. So to us, that makes packaging matter.” Consumer impact is influenced by perceived value, and adding value to a package adds value to the product. The most successful packages have incorporated its use with the product, which has been a prominent theme in the food and beverage industry. Resealability and storage have been important factors for food, and multiple companies have been finding innovative ways to do this, making packaging more ergonomic for its end users. In turn, this makes the overall product more valuable. This type of impact, which can be easily overlooked, influences the purchasing decisions of consumers, with a common trend of consumers buying more convenient options. This largely impacts a company’s success, which can be measured in overall sales and profits per quarter, per year, etc.

Conclusion

In the past few years, recent innovations in consumer package design have brought success to companies that have made the decision to implement them. In today’s modern industries, companies are beginning to prioritize packaging almost as much as the products they manufacture themselves. Understanding the importance of packaging design and optimization can not only increase sales, but also create an effective competitive advantage for a company while simultaneously driving down overhead costs for manufacturers in a myriad of industries. Proper maintenance of packaging specifications and design is detrimental to the success of a company, and it’s never too late to start today.

 

ABOUT THE AUTHOR
James Salazar is a recent graduate of Cal Poly San Luis Obispo. Receiving a degree in Industrial Technology, he is currently employed as a Packaging Engineer at specright, Inc.