| Once thought of as the last item to consider in product | | | | consumers open to buying private brands, suppliers |
| marketing, now product labeling is a key factor in | | | | and retailers have come up with new ways to gain |
| promoting sales growth. Research shows that the | | | | customer loyalty. Rather than just emphasizing their |
| product's label is highly influential in determining the | | | | price-point, private labels are being designed to target |
| consumer's level of interest in a product at the Point of | | | | specific consumer groups' buying requirements. Private |
| Sale and in integrated marketing communications | | | | brand suppliers are marketing "new and improved" |
| programs. This is true for nationally recognized brands, | | | | items that offer more features that appeal to old and |
| and it is even more important in private label brand | | | | new customers alike. By staying in tune with consumer |
| programs. Private brands typically rely heavily on the | | | | interests and needs, private label brands are a trend |
| product's packaging and label to market products at | | | | that is sought after by the best-in-class retailers. |
| the Point of Sale. | | | | Making Labels Work |
| In a fiercely competitive industry, retailers are | | | | For suppliers focused on driving sales revenue growth, |
| incorporating more technology to track products, | | | | there are several ways to approach packaging and |
| increase sales, and reduce cost. The most successful | | | | labeling in a customer-centric environment: |
| corporations are adopting customer-centric policies to | | | | - Appeal to specific demographics of each retail |
| boost business. Customer-centricity allows retail chains | | | | channel |
| to customize their store layouts based on the | | | | - Design custom labels that differentiate their products |
| consumer demographics of each individual location. | | | | as well as being easy to understand |
| RFID labeling supports customer-centricity by allowing | | | | - Gather customer data and adapt to changing |
| retailers to keep real-time data of product and sales | | | | consumer's needs |
| status. With this technology, retailers may move | | | | - Treat packaging and labeling as a prime marketing |
| products that are not selling to less desirable locations | | | | communication strategy |
| in the store or discontinue the item completely. As a | | | | Customer Demographics |
| result, to keep their product in sight of the consumer, | | | | Since the retailers are making customer-centric |
| suppliers are challenged to package and label their | | | | modifications to bring consumers through the door, |
| products to meet the needs of their customers as well | | | | product labels and packages must address the |
| as their retailers. Successful retailers implementing | | | | retailer's and the customer's specific demographics. |
| costumer-centric ideals include Wal-Mart, Home Depot, | | | | For instance, food and beverage suppliers selling |
| and Best Buy as well as many others. With the right | | | | through Target or Whole Foods Markets may want to |
| merchandising strategy, suppliers can successfully | | | | create a gourmet line that appeals to thrifty shoppers. |
| package and label their products to meet the needs of | | | | Some consumers demand environmental-friendly |
| their customers and retailers to maximize sales. | | | | suppliers that use recycled materials and minimize the |
| To develop a successful product marketing sales | | | | amount of excess packaging materials. Shoppers |
| strategy, it is important to analyze several points of | | | | seeking a low-cost, equal alternative to national brands |
| market research: | | | | may want products that explicitly compare contents |
| - Successful tactics of the top retailers of the supplier's | | | | and quality with their national brand competitors. With |
| sales channel. | | | | each retailer comes a unique consumer expectation. |
| - Labeling and packaging requirements for specific | | | | Using this knowledge to respond to customer |
| retailers and their customers. | | | | expectations is highly advantageous. |
| - Creating a package and label design that is | | | | Brand Differentiation |
| customer-centric. | | | | Each package and label should immediately capture |
| - Using technology to maximize consumer data and | | | | the attention of the consumer. If the label causes the |
| minimize cost. | | | | shopper to do a "double take" upon seeing it, the |
| - Follow the example of successful labeling campaigns | | | | chances of selling that product increase dramatically. |
| requirements. | | | | Having caught the attention of the consumer through |
| Success in Retail and Wholesale Channels | | | | an innovative design, the label must also be clear, easy |
| Among the first to require their suppliers to use RFID | | | | to read, and make sense. If the consumer can't |
| tags on pallets, Wal-Mart has an IT strategy and | | | | immediately determine what the product is or what it |
| costumer-centric policy that has kept the chain as one | | | | does, he or she will move on. Suppliers can extend the |
| of the most successful in the nation. Their IT strategy | | | | reach of their marketing communications programs by |
| creates an efficient system throughout their network. | | | | utilizing a common brand identity across product lines |
| By incorporating a consistent system, error is | | | | and promotional plan elements. Not only does this |
| minimized, and more time is allowed to focus on | | | | make it easier for the consumer to recognize the |
| product turnover and customer satisfaction. This | | | | product, but it is also an efficient strategy for creating |
| satisfaction is taken into account first and foremost | | | | brand awareness and brand credible. |
| when Wal-Mart decides to work with a supplier. | | | | Adapt to Changing Customer Behavior |
| Label Requirements and Customer-Centricity | | | | When it comes to creating the design and layout of a |
| Wal-Mart's motto to their suppliers is, "If it works for | | | | product label, adaptability to customer demographics is |
| our customers, it works for us". When it comes to the | | | | essential. Many companies gain information on |
| product package and label, their rule is that the | | | | consumer preference through focus groups, retailers, |
| customer must "get it" within 3 seconds from 15 feet | | | | and other customer buying behavior data. Using this |
| away from the shelf. Once the product fills these | | | | information, a supplier can determine what makes a |
| requirements, the item must grab the attention of the | | | | label more appealing and easier to understand, which |
| consumer. The average consumer wants to be | | | | can have a direct effect on sales performance. In |
| dazzled, and it is therefore imperative that packages | | | | addition to knowing and delivering what your consumer |
| and labels are created with the consumer's needs in | | | | wants, the packaging and labeling must work in the |
| mind. | | | | application conditions. For instance, labels that wrinkle or |
| Packaging and labeling must not only appeal to a | | | | peel off of a product convey poor quality to the |
| target market, but must also address the specific | | | | consumer. If label graphics bled, it may make the |
| demographics of the retail store selling that package. | | | | product information difficult to read over the life of the |
| When a consumer has a need for a product, their first | | | | product. There are many resources available on how |
| buying decision is quite likely which store to shop at | | | | to pair the package and label materials to a wide |
| rather than which product to buy. Therefore, a supplier | | | | range of application conditions to provide innovative |
| must maintain a solid relationship with their retailers | | | | graphics as well as robust technical performance. |
| who act as the gatekeepers to their consumers. | | | | Private Label Brand Potential |
| Retailers strive to provide a convenient, comfortable | | | | Looking at the success of private label brands |
| shopping experience for their customers. In order to | | | | eliminates any doubt about whether these labeling |
| keep their product alive and in sight of the consumers, | | | | tactics work. As stated earlier, innovative private labels |
| suppliers must adhere to what is important to each | | | | allow suppliers to forgo huge marketing costs by using |
| retailer as much as to what is important to their end | | | | the product itself for promotion right at the point of |
| customers. | | | | sale. Product packages and labels have been a |
| Success in Private Label Brands | | | | platform for success locally, nationally and worldwide. |
| Private label brands are a success story among big | | | | For example, today, 40% of products sold in Wal-Mart |
| retailers as well as national buying groups and | | | | are private label brands. With the increase in |
| wholesalers for independent local dealers. Private | | | | high-quality private label brands, the industry will |
| brands which were once considered low-price | | | | continue to thrive. |
| alternatives to national brand names are now matching | | | | Customer-centricity is being implemented in mega-chain |
| or surpassing the sales of national brands. This trend is | | | | retail stores as well as independent dealers with great |
| largely attributed to the packaging and labeling of | | | | success across the country. Coupled with technology |
| private brands. With minimal advertising budgets, | | | | advancements, retailers have the tools to keep their |
| private label brands must use the packaging and | | | | consumers coming back. While these changes may |
| labeling itself to market the item. The packages and | | | | pose a threat to certain suppliers who don't keep pace |
| labels have so successfully captured the consumer's | | | | with customer, retailing and wholesaling trends, |
| attention that the quality of private label brands is now | | | | implementing customer-centric ideals in labeling and |
| considered to be equal to or greater than national | | | | packaging provides the opportunity improve sales |
| brands. Retailers, such as Wal-Mart, who have been | | | | revenue growth for progressive suppliers. Therefore, |
| selling private brands since 1991, are well aware of the | | | | custom printed labels should be integrated into a |
| power of private label brands and how to position | | | | supplier's product marketing strategy. Product labels |
| such items to consumers. | | | | can be crucial promotional tools. Innovative product |
| Another advantage of private label brand packaging is | | | | packaging and labeling can create higher customer |
| the ability to service a wider demographic target | | | | demand and improved profitability. |
| market. To appeal to the growing number of | | | | |