The Optimist's Guide:

Posted: September 13, 2009 by
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 I am an optimist by nature, but living in Minnesota for 41 years has taught me two things: the unpredictable power of weather, and the need to be prepared for anything.
Rapid and seemingly inexplicable market changes have led to a growing sense of bewilderment in consumer products marketing. While package design has become crucial to the marketing mix, some tried and true approaches simply don't work as they once did. There are emerging markets, changing demographics, a plethora of retail channels, and baffling consumer shopping patterns. Where is the rhyme and reason? What will consumers and retailers do next?

The good news: Understanding trends allows us to predict and respond to what's coming. And some major weather is on its way. Look for things to get stirred up.
I consider the four trends identified here to be significant contributing elements of the "perfect storm." Their combined impact will challenge us to reevaluate what we think about marketing, package design and consumer behavior. Anyone hoping to survive the coming storm needs to keep these dynamics in mind.

Demographic ocean swell

Baby Boomers, the largest, best educated and most affluent generation in U.S. history, wield an estimated spending power of two trillion dollars. While the first wave of Boomers turned 60 in 2006, they're not exactly riding off into the sunset of retirement. The "Me generation" is just getting their second wind, and finding new ways to stay healthy and current and live full, robust lives. In short, this group is redefining what it means to age in America, with major implications for marketers in every consumer product category.

Although Boomers grew up with the most iconic brands, from Coca-Cola to Levi's to Betty Crocker, marketers and designers need to watch their backs. Boomers' propensity for self-indulgence and adventure will make them less brand-loyal in their golden years as they drive the creation of new products that help improve health, vitality, and function.

One of the keys to our firm's work in this area is creating packaging structures that are easy to manipulate with limited strength and dexterity. From a visual standpoint, this segment must be engaged-but not condescended to. For example, typography size may need to be "optimized," but packaging can't look like it is designed for the visually impaired.

Boomers are only one of the segments we have been tracking. We are currently in the midst of a five-year study of consumer shopping behavior that is yielding fascinating cross-channel data. But with Boomers controlling 40% of America's disposable income by 2030, there is no question that ignoring them could be dangerous.

Green atmospheric pressures

Americans are listening to the global climate change news and becoming more aware of the effects of our "consumption lifestyle" on the planet. The growth in natural/organic products sales shows they're casting their votes with their wallets-and that sustainability has finally hit Main Street.

Marketers are beginning to understand the advantages of sustainability, too. Not only are consumers willing to pay more for green products, they establish a deeper connection to brands that reflect their personal values.

New products are emerging in every category, from brands that have built their positioning around sustainability to mainstream brands with new greener angles. I believe manufacturers will be challenged to be more transparent with consumers about their product's broader social and global impacts.

Retailers are already demanding less waste. Our firm frequently works with clients to develop packaging for disappearing pallets that enable retailers like Sam's Club to reduce packaging disposal and labor costs.

Consumers are not far behind. They will demand less packaging and less waste. We may even see a disdain for over-packaged products that will affect purchase decisions. This means major changes in packaging structures and product delivery methods at the point of purchase. It also means less physical real estate, so designers will have to create new vehicles for communicating a product's brand and positioning.

Mighty global trade winds

The world continues to shrink and global markets continue to expand. Today, non-English speakers drive 70% of the global economy. American consumer product companies that learn to navigate the rules of multicultural communications will literally have the entire world as their oyster. Luminaries like Coca-Cola, 3M, and Procter & Gamble already enjoy substantial profits from foreign markets.

Introducing a domestic brand into the global market is a complex endeavor. We recently created packaging for a new product launch in Europe and Asia for Hill's Prescription Diet pet food and updated the Betty Crocker brand overseas. These projects required explorations of cultural, aesthetic, religious, historic, and even gender issues as we worked with the visual language and aesthetics of new markets while maintaining the essences of these brands. Simply translating the feature and benefit copy into other languages is never enough.

The key here is doing the homework-evaluate your brand and packaging against cultural norms and potential disconnects. Never make assumptions.

Retail turbulence

Remember when retail stores were easily defined and consumers were predictable and loyal to their brands? Now we have channel blurring, dollar stores, multi-channel shopping, club stores, natural foods stores that "trade up," mass merchants that "trade down"-not to mention the Internet. Consumers have more choices and power than ever, and their expectations change drastically from channel to channel. Retailer requirements change from channel to channel, too.

The result is that it is no longer realistic to expect the same package to work across multiple channels. We frequently work with clients to develop new ways to inject flexibility into their branding systems, allowing them to succeed from one retail venue to another. The resulting packaging is designed to fulfill consumer expectations associated with specific retail channels. For example, we worked with Jennie-O Turkey Store to develop a packaging system that highlights sophisticated flavor profiles to target "treasure hunting" club store shoppers. These new offerings became a huge hit and grew their business.

There is no need to go down in the perfect storm. On the contrary, storm systems bring with them incredible energy. From where I'm sitting, I see unbelievable opportunity for marketers who head out there with their eyes open, ready for adventure.

Jerry Johnson is the cofounder and president at Voltaggio Johnson Design. Since 1991, the Voltaggio Johnson team has worked with companies to develop packaging strategies that engage consumers across diverse retail channels. To contact Jerry, call 877-338-2920 or visit www.voltaggiojohnson.com.

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