Although they may be offering the most innovative new gadget or idea in the last decade, it can lose much of its impact on the consumer if it is not professionally packaged.
Think about this for a minute. You spend thousands of dollars, possibly borrow from a bank to launch your great product. Then you hire an advertising company to give you marketing ideas. Should you advertise on TV, radio, newspaper, magazines and so on?
The last thing that gets discussed in these strategy meetings is how you are going to package your product. This is a huge mistake!
The fact is there are 2 parts to every sale. The first is motivating a prospect to buy your product. The second is to reinforce the customers decision that he or she made the right decision. The second part is the one that will bring this customer back to purchase from you again and again.
In today's global economy, less than 20% of all goods are sold to a customer only 1 time. This means most companies depend on repeat business and referral business for survival and growth. This means that for all of the money you spend on driving business to your door you are only solving half of the problem. The other half which is your life's blood, is possibly being ignored.
In reality, your main consideration when selecting your packaging strategy should not be focusing on the lowest cost; but rather the most effective method to reinforce your customer's buying decision. Rihaz Z Chughatta, President of Equity Packaging recently wrote great piece on this subject at the Industry of Packaging Professionals website. He brilliantly describes how you can turn packaging into profits.
An example of how packaging turns profits is a local medical outpatient surgical center in my area decided to upgrade their personal property tote bags from a stock bag to a custom printed die cut handle bag. They told me that they gained new patients that simply saw the bag from a from friends that were previous patients. The revenue from the new patients amounted to more than 20 times the additional cost of the packaging upgrade.
In my better than 25 years in the packaging business I have witnessed and assisted in 100 of cases where upgrading packaging revitalized industries. In 1984 I introduced the disposable bank deposit bag on the request of a large bank in San Francisco CA. They were looking to eliminate using key locking canvas bags as the handling costs were excessive. Even though the cost of disposable bags created initially a higher cost, the labor savings and ability to use a central depository system saved them hundreds of thousands of dollars per year. Today disposable bank deposit bags are the standard of the retail banking business
In 1992 at the request of Price Club/Costco stores we converted some of their frozen food products from boxes to barrier quality printed plastic bags. Although the bags were double the cost of boxes their sales skyrocketed because customers were able to view the contents of the bags where boxes obscured them.
These are dramatic examples but are illustrative of how profits are made from rethinking packaging strategies that focus on you and your great quality. Simple upgrades such as adding or improving the imprinting on your bag can achieve tremendous results. Possibly providing a releasable bag rather than an open top bag can offer greater utility and encourage customers to select your product.
Lastly, be aware of your competition. Even though I have always advocated being the leader in the market, it is always wise to see what others are doing. If your competition is outselling you, possibly their packaging is playing a role in their success.
