The power of packaging and branding

The British Brands Group has commissioned three reports to look into relevance of packaging and the role it plays in the market economy.  The reports are of particular interest to those operating in the Fast Moving Consumer Goods (FMCG) sectors.

The first report, “The Hidden Power of Packaging”, focuses on the importance of branding in successful businesses.  Packaging has evolved to be so much more than simple wrapping for the goods and now enables companies to communicate directly with consumers through the use of distinctive designs, logos, graphics, images and colours.  Brand owners are investing serious financial resources in the creation of distinctive brands and are becoming fiercely defensive of packaging characteristics as these are often what enable consumers to readily identify their brand at the point of sale from competitive products.  For this reason, many brand owners are becoming increasingly frustrated by lookalike products which can swamp the marketplace. 

The debate is ongoing as to whether or not lookalike products stifle competition or actually make the marketplace more competitive, as the products themselves need to have individual functionality to stand out beyond the packaging. 

The report also discusses the changing role of packaging during the life cycle of a product; for example a new product would need packaging which would encourage consumers to try a brand for the first time, whereas in a mature market this may not be necessary.  For an everyday product like soap, for example, it is difficult to envisage how much influence the packaging would really have on the purchasing process in the absence of a new product, new functionality or other innovation, no matter how attractive or striking the packaging.

The jury is still out with regard to how far legal statute and regulation should extend regarding a brand owner’s ability to compete effectively through packaging vis-à-vis maintaining a healthy competition and economy.

The second report, “The Effect of Branding on Consumer Choice”, comments on today’s retail environment.  The average UK supermarket carries over 45,000 product lines.  This means that the average shopper buys around 50 items in 50 minutes.  Consumers therefore weigh up around 900 items each minute during a typical shopping trip.  For this reason the mental image of the packaging becomes increasingly important to consumers in selecting their desired brand from the general product range.  It follows that the more distinctive and innovative packaging is, the more easily the brand will come to mind. 

Much research has been undertaken to assess the impact on the cognitive purchase processes when lookalike products are offered alongside genuine branded products.   Full details of the research and the methodology undertaken can be found in the report, but in summary this study indicates that branding does have a strong impact on consumer’s ability to find and recognise brands. 

The report also suggests that changes to branding and/or the existence of copycat branding slows down consumer’s selection, because brands that are not recognised quickly and easily are less likely to be purchased. This arguably could be seen as a green light to marketers to get as creative as possible with branding, to ensure that products stand out from the crowd. 

The final report, “Confusion, Heuristics and the Consumer”, looks to evaluate the options for UK courts dealing with companies which frequently ride on the branding of others.  Courts in the UK have basic concepts of confusion, misrepresentation and infringement that can be used.  However, the existing legal requirements for submitting evidence of confusion between the genuine brand and a lookalike brand can mean that companies can find it difficult to successfully show the detrimental effect of a copycat product. 

Research is currently under way to build virtual retail stores to try and create a retail environment which monitors the effect of consumer’s choice as the shelves become more cluttered with lookalike products.  The aim is to develop a comprehensive review and analysis tool in respect of the impact of brand recognition on the decision process.  Being able to rely on a more scientific basis for defining the extent of confusion should enable brand owners to demonstrate effectively the overall picture which results from a copycat product being in the marketplace. 

It is hoped that the more familiar the courts become with these techniques the greater reliance that will be placed on this form of evidence, and thus the easier it will ultimately be for brand owners to challenge copycat manufacturers.  At the present time, we are still awaiting a lookalike case that can provide solid legal guidance to both practitioners and marketers in this area. 

A summary of the three reports, which the British Brands Group hopes will encourage the many functions of packaging to be considered whenever it falls under scrutiny, is also available.