Collaborate For Design Success

Retailers and suppliers both know that a package that looks great, functions well and communicates the brand's message is critical to a store brand product's success. But all too often, they both face a communication disconnect when developing packaging for private label products.

Progressive Grocer's Store Brands asked representatives from two retail companies (Maria Brous, media and communications director, Publix Supermarkets, Lakeland Fla.; and Regina Tator, director of private brands, Weis Markets, Sunbury,

Pa.) and representatives from two supplier companies (Mark Moorhead, corporate director of marketing, WM Packaging Group, Algoma, Wis.; and Suley Muratoglu, vice president of marketing and product development, Tetra Pak, Vernon Hills, Ill.) to weigh in on how retailers and suppliers could better collaborate to develop innovative packaging for their store brand products.

PG's Store Brands: Why is collaboration critical on the packaging side of store brands?

Maria Brous: 1: Keeping up with changes made by the national brands. Oftentimes, the package change will cause a change in equipment, which [creates] a capital expense.

2: Trying to get ahead of the national brands. This requires customer research to make sure you add relevant upgrades and not just add cost, [and] a willing-and-able supplier to make the change and/or investment with you. [It] also runs the risk of us making the investment in research and risk, only to see it appear on other retailers' products that are supplied by same manufacturer. In general, this all requires collaboration with suppliers.

Mark Moorhead: There are compressed timelines and very aggressive goals for store brands as they pursue the development and execution of their store brand strategy. There are a large amount of functions and individuals who impact the success of the project: the brand owner, the graphic designer, the co-packer, the printer — and even distributors. Project success can be directly linked to having everyone at the table at the same time and early in the process to contribute critical information.

When this occurs, we have found several times [that] we are able to take the initial concept up several notches aesthetically and even at a lower ultimate cost. Package printing and the technical aspects of application of packaging are continually changing, so it is virtually impossible for designers and brand owners to keep up to date with possibilities for the project unless they include the packaging supplier early in the process.

Suley Muratoglu: Collaboration is critical to advancing innovation in any area, and it definitely holds true for packaging manufacturers. Over the last few years, [we've been] noticing that the retailers ... pushing for innovation in the food category are the ones leading the pack by being the first adopters. The combination of changing demographics and consumer preferences is also creating new opportunities for collaboration.

Millennials ... represent a demographic with specific needs that opens up a unique collaboration opportunity for packaging companies and retailers to address. According to a recent study from Jefferies and AlixPartners released in June, millennials are more likely to pay more for the specific attributes they value, which are convenience, freshness, health and product variety — size, flavor, etc. They are also motivated by products with sustainable features. Suppliers and retailers who work side by side to address these preferences are in a better position to create innovative solutions that, in turn, drive brand loyalty.

Regina Tator: Redesigns and packaging changes are costly and translate into increased costs and smaller spreads versus NBE. It is necessary to work closely to keep products relevant and designs updated.

PG's Store Brands: What key elements are needed to make such a retailer-supplier partnership work?

Brous: Primarily, we have to understand the customer requirement we are trying to solve, and then work collectively on the best and most cost-effective solutions.

Moorhead: A trust and willingness on the part of the brand owner to share their timeline and goals for the brand early in the process. The package is the last chance to win the consumer at the moment of truth — when consumers make split-second purchase decisions.

Muratoglu: At Tetra Pak, we find that the most successful partnerships are those that are built around the "give and take" that comes through dialogue. … One way to keep a steady dialogue is to be actively involved with industry third parties such as the Retail Product Innovation Council. Cultivating strong relationships between retailers and the marketing and sales teams is also important, leading to continued trust and collaboration down the road.

Tator: Communication. Frequently, I get downsizes or formulation "tweaks" communicated at the 11th hour, and the product needs a facelift. And there ends up being the immediate change that is necessary, and then the redesign. Advance notice would streamline and be more cost-effective.

PG's Store Brands: In your view, in what areas do many retailers need to improve when it comes to collaborative store brand packaging efforts?

Brous: Identify the same end goal.

Moorhead: Looking beyond just the package to how to influence the purchase decision using all of the various point-of-sale tools available that complement the package, and designing the packaging with this in mind. In an era where smartphone usage is exploding and consumers are using technology like never before to make purchase decisions, there are new innovations in packaging that harness the opportunities related to this technology and brand promotion.

Muratoglu: Retailers have a lot to gain by considering the influence and appeal of the shelf presence and spatial organization of the product. [Visual allure and spatial efficiency] on the shelf or display area are two key [attributes] that will help make [packaging] more competitive. Retailers [would] benefit by redesigning the grocery aisle — not only to accommodate and appeal to consumer preferences, but also to move products off the shelf as quickly as possible.

Tator: We all say that there are industry standards in terms of amortization and [the] length of time packaging supply is guaranteed in the event of a packaging or supplier switch. But there is a large variance [in those standards], and I think it's difficult for suppliers to track and comply.

PG's Store Brands: In your view, where do many suppliers need to improve?

Brous: Be upfront about constraints — financial, facilities, expertise, etc.

Moorhead: It is important to effectively work with both the [manufacturer] and the brand owner to ensure that the best solution is executed, working with both entities. This is somewhat more challenging than working with a national brand, where all functions are under one roof.

Muratoglu: The greatest opportunity for improvement is in continually staying ahead of consumers by providing retailers with packaging that offers unique product differentiation and meets consumers' changing preferences.

Tator: There seems to be little or no discussion regarding [this topic] unless there is some form of transition. It would be nice to know more about best-in-class packaging and [the] lifts that they are seeing when new line looks are implemented.