Branding, Packaging and Labeling

1. Branding, Packaging and Labeling

2. Topics • Branding • Importance • Types • Strategies • Packaging • Function • Issues • Labeling

3. Branding • Brand • Name, term, design, or symbol that identifies a business and its products • Corporate brands • Identify the business and reflect image across all products • Coca-Cola, Daimler-Chrysler • Product brands • Among most important assets and powerful selling elements • Coke, Dodge

4. Brands • Brand Name • Words, letter numbers the represent brand • Corvette, Airwalk, FedEx • Brand Mark • Logo or symbol • Trade Name • Legal name a company uses to conduct business • Dell, Xerox

5. Brands • Trade Character • Brand mark as a character with human qualities • Keebler, Doughboy • Trademark • Any combination of these that is legally protected • Have been expanding to include sound, color, smell • Harley trademarked its engine sound

6. Importance of Branding • Builds customer loyalty • Customers pay more for recognized names • Assures customer of quality & reduces risk of dissatisfaction • Assists in extending lines • Customers more willing to try familiar names

7. Generating Brands • Estimated that 75% of companies introduce a new product brand annually • In 1999, 79,000 trademarks were registered • Global brands often consolidate names • Confusion can result from multiple names for the same product • In UK, 3 Musketeers is known as Mars Bar

8. Types of Brands • Manufacturer Brands • Producer brands, owned by manufacturer • Gives impression of standard quality, performance & status • Most brands are manufacturer brands • 65% of appliances • 70% of food • 80% of gas • 100% of cars

9. Types of Brands • Private distributor brands • Store or dealer brands, owned by retail stores • Item is purchased to be sold exclusively at certain stores, i.e. Radio Shack brand • Manufacturer name is not displayed • Higher returns for store • Builds retailer loyalty • Craftsman, Kenmore sold only at Sears

10. Types of Brands • Generic Brands • Carry no company name, just product description • Sold much cheaper, 30 – 50% lower than manufacturer brands, and 10 – 15% lower than store brands • Jewel supermarkets in Chicago were the first to offer

11. Branding Strategies • Brand extension • Uses existing brand name to promote new products • Dilution may become a problem • Brand Licensing • Allow other companies to use trademarks for a fee, plus royalties on sales • Enhances image & helps sales of core products

12. Branding Strategies • Mixed branding • Offer combination of manufacturer, store & generic brands • Manufacturer will sell under a national brand, then sell extra to a store to be repackaged under a store brand, then make a generic • Maximizes profit by appealing to all segments

13. Branding Strategies • Co-Branding • Uses two or more brands to increase loyalty and sales for individual brands • Builds recognition for each, work best if product complement each other • Starbucks in Barnes & Nobles • Smuckers jelly in Pop-Tarts

14. Packaging • Physical container or wrapping • Approximately 10% of retail price is spent on package • In some cases, package is most expensive part of production

15. Function of Packaging • Key selling tool • Promoting & selling • Reaction to packaging is important to overall success or failure • New designs may not replace old, but complement it • Pump soap containers • Defining product identity • Invoke prestige, convenience, status, etc.

16. Function of Packaging • Provide information • Directions on how to use, warnings, ingredients • Meet customer needs • Various sizes for different market segments • Must adapt to meet changing lifestyles

17. Function of Packaging • Ensure safe use • Tamper resistance, child proofing • Blisterpacks, molded plastic with foil or cardboard backing • Gums and some medicine • Protection • Shipping, storage, display • Prevent shoplifting, breakage & spills

18. Contemporary Issues • Changing social and political atmosphere leads to changes in product & package • Environmental packaging • Surveys indicate consumers will pay more for these packages • Cause packaging • Promoting unrelated issues on package, usually socially or politically motivated • Ben & Jerry’s, Body Shop

19. Labeling • Informational tag, wrapper, seal or imprinted message • Main function is to inform about contents and give directions • Protects company from liability & lawsuits

20. Labels • Brand label • Gives name, logo & trademark • Descriptive label • Gives information about use, construction, care, performance, etc. • Does not contain all the information that a consumer might want • Grade label • Give product quality

21. Labels • Food labels must contain weight, dating and storage information, UPC, etc. • Net weight is entire product minus the weight of package and packing materials • Dating options are • Date packed • Sell by date – last day it should be sold • Best if – last day for best quality • Expiration – should not be used after

22. Labeling Laws • Public outcry has lead to regulations on what needs to be incorporated on labels • Fair Packaging & Labeling Act (FPLA) gives the FDA and FTC authority over labeling • Not all countries have the same label laws • Coke was pulled off Italian shelves because they would not list the “secret ingredient”

23. Labeling Laws • FDA • Enacted a law to require labels to give information on how the product fits into a daily diet • Developed definitions for light, free, low, reduced and good source • Warning labels on cigarettes and alcohol • Developing regulations for genetically modified foods

24. Labeling Laws • FTC • Responsible for ensuring labels are not deceptive • Released guidelines for environmental claims • Requires proof for all claims