This case talks about the dilemma of Campbell Soup Company who wants to change the packaging of their soups. They want to change both the brand name and the packaging of their soup which was earlier available in tin cans.
# As a convenience goods producer, what marketing consideration do Campbell executives have to keep in mind
Convenience goods are those that the customer purchases frequently, immediately, and with minimum effort. Tobacco products, soaps, and newspapers are all considered convenience goods, as are common staples like ketchup or pasta. Convenience-goods purchasing is usually based on habitual behavior, where the consumer will routinely purchase a particular product. Some convenience goods, however, may be purchased impulsively, involving no habit, planning, or search effort. These goods, usually displayed near the cash register in a store in order to encourage quick choice and purchase.
Marketing Considerations for Campbell executives:
1. Pricing per item should be relatively low as consumers often see little value in shopping around since additional effort yields minimal savings.
2. They should attempt to distribute the soup in mass through as many retail outlets as possible.
3. The number of potential customers in the market.
4. How concentrated or dispersed they are
5. How much each will buy in a given period
6. Costs associated with the practical side of the distributive operation (e.g. transport, warehousing and stockholding)
7. What kind of distribution they want
# Do you think Campbell should market soup in a new container under a different brand name What options does the firm have
No, Campbell should not market soup in a new container under a different brand name because their brand name is already trusted by lot of people and they may not be familiarized with the new brand name soon enough. Secondly a change in can will be enough to attract the new generation because new generation already know about the soup but is not buying because of the extra effort that comes with the tin can. So a new can will be able to attract them.
Other option with firm is to relaunch the soup as a new product and should keep the following in mind:
Among the key components included in a strong product launch plan:
* Clearly defined sales objectives
* Assured sales channel readiness
* Promotional functions in place (public relations/marketing/advertising)
* Resources to track, monitor and account for execution
To make sure everyone is working toward the same goal, certain milestones should be established:
* Have we identified all necessary launch channels
* What number of new products do we plan to sell by a specific date
* When will the product be ready to launch at a national trade convention
* Are sufficient stocking orders placed with key distributors
* How can we grow the product into a 5-10 percent market entrenchment by a specified date
Approaching the customer with the new product can be the most delicate situation of all. If existing customers encounter design flaws in the new product, they may forgive and forget (particularly if their relationship with the company is strong enough), but its unlikely new customers will feel the same way. Also, the new product may not be the right “fit” with all of your current customers. Preparedness reduces the risk that the companys credibility may be damaged by missteps at launch time.
Also following should be used as companys marketing communications:
* New and current product literature
* Press releases
* Product specifications
* Sales presentations
* Internal communications
Advertising should be aimed at presenting the product (specifically, its features and benefits) in the best possible light.
Before launching following questions should also be kept in mind:
* Do our existing distributors serve mass marketing retail outlets
* Does our current pricing schedule take factors like mass market competition into consideration
* If we lower our price, how much can we afford to spend on the sale of each unit at this lower price
* Can we reach this market with our current sales force
#3Factors should Campbell have considered in the decision to change to a new package:
* Protection ??“ Packaging is used to protect the product from damage during shipping and handling, and to lessen spoilage if the protect is exposed to air or other elements.
* Visibility ??“ Packaging design is used to capture customers??™ attention as they are shopping or glancing through a catalog or website. This is particularly important for customers who are not familiar with the product and in situations, such as those found in grocery stores, where a product must stand out among thousands of other products. Packaging designs that standout are more likely to be remembered on future shopping trips.
* Added Value ??“ Packaging design and structure can add value to a product. For instance, benefits can be obtained from package structures that make the product easier to use while stylistic designs can make the product more attractive to display in the customer??™s home.
* Distributor Acceptance ??“ Packaging decisions must not only be accepted by the final customer, they may also have to be accepted by distributors who sell the product for the supplier. For instance, a retailer may not accept packages unless they conform to requirements they have for storing products on their shelves.
* Cost ??“ Packaging can represent a significant portion of a product??™s selling price. For example, it is estimated that in the cosmetics industry the packaging cost of some products may be as high as 40% of a product??™s selling price. Smart packaging decisions can help reduce costs and possibly lead to higher profits.
* Inexpensive to Create – Developing new packaging can be extremely expensive. The costs involved in creating new packaging include: graphic and structural design, production, customer testing, possible destruction of leftover old packaging, and possible advertising to inform customer of the new packaging. There should be proper spending on these factors.
* Long Term Decision ??“ When companies create a new package it is most often with the intention of having the design on the market for an extended period of time. In fact, changing a product??™s packaging too frequently can have negative effects since customers become conditioned to locate the product based on its package and may be confused if the design is altered.
* Environmental or Legal Issues ??“ Packaging decisions must also include an assessment of its environmental impact especially for products with packages that are frequently discarded. Packages that are not easily bio-degradable could draw customer and possibly governmental concern. Also, caution must be exercised in order to create packages that do not infringe on intellectual property, such as copyrights, trademarks or patents, held by others.
#4 List of criteria for Campbell to use in deciding on what package to use:
Protect: – they should implement packaging that delivers the safest and highest quality food while ensuring consumer and brand protection.
Reduce:-continuously seek packaging material and processes that utilize less resource while maintaining product quality and supply chain efficiently
Recycle: – utilize recyclable and recycled content packaging materials where possible
Renew: – utilize renewable sources of packaging materials which are safe and effective
Partner: – work with suppliers to promote clean production technologies and best manufacturing processes
In a nutshell they should design with sustainability mindset to deliver safe, consumer preferred packaging while minimizing or environmental impact. Create economic vale by linking sustainability with source reduction, material selection and supply chain efficiencies. Partner externally with suppliers, customers and industry groups to their program and influence direction.
Packaging is now generally regarded as an essential component of our modern life style and the way business is organized. Packaging is the enclosing of a physical object, typically a product that will be offered for sale. It is the process of preparing items of equipment for transportation and storage and which embraces preservation, identification and packaging of products. Packing is recognized as an integral part of modern marketing operation, which embraces all phases of activities involved in the transfer of goods and services from the manufacturer to the consumer. Packaging is an important part of the branding process as it plays a role in communicating the image and identity of a company.
1. Protection and preservation
A basic function of package is to protect and preserve the contents during transit from the manufacturer to the ultimate consumer. It is the protection during transport and distribution; From climatic effects (heat and cold, moisture, vapour, drying atmospheres); from hazardous substances and contaminants; and from infestation. Protection is required against transportation hazards spillage, dirt, ingress and egress of moisture, insect infection, contamination by foreign material, tampering pilferage etc. A package should preserve the contents in Factory Fresh condition during the period of storage and transportation, ensuring protection from bacteriological attacks, chemical reaction etc.
Most products must be contained before they can be moved from one place to another. To function successfully, the package must contain the product. This containment function of packaging makes a huge contribution to protecting the environment. A better packaging help to maintain the quality of the product and reachability of the product in the consumers hand without spillages It gives better image to the organisation.
A major function of packaging is the communication of the product. A package must communicate what it sells. When international trade is involved and different languages are spoken, the use of unambiguous, readily understood symbols on the distribution package is essential. It is the interest further that to get appropriate communication to the consumer about the product, how to use it and other utility informations. Packaging protects the interests of consumers. Information includes: quantity; price; inventory levels; lot number; distribution routes; size; elapsed time since packaging; colour; and merchandising and premium data.
Importance of packaging
Some of the major significance of packaging can be detailed as follows:
* Can make a product more convenient to use or store, easier to identify or promote or to send out a message.
* Can make the important difference to a marketing strategy by meeting customers needs better.
* Packaging plays a key role in brand promotion and management. Packaging is of great importance in the final choice the consumer will make, because it directly involves convenience, appeal, information and branding.
* The paramount concern of packaging is the reachability of the product without any damage. No matter where and how the products are transported or shipped, they arrive at the customers door in working condition without need of repair or adjustment.
* Packaging is especially important in certain industry where future sales may be based largely on the quality, integrity and performance of a companys previous delivery.
Importance in marketing
Packing is a marketing tool used to reflect the brand. A company uses packaging to sell the product inside. The colors, fonts, descriptions and logo are designed to drive consumers to buy the product. Packing is designed to capture a customers attention and it can directly effect whether they buy the product or not. Innovation and creativity come into play when it comes to packaging. A well-marketed product is packaged in a way that compels the customer to pick it up and take a closer look, at which point product descriptions and graphics must be clear.
Yes, the decision confronting Campbell management as one that may confront many firms in India. Coca-Cola is one such brand which changed its packaging according to the consumers and environment.
They are advancing sustainable design efforts through an initiative known as e3, which focuses on improving efficiency, life-cycle effectiveness and eco-innovation. For example, using state-of-the-art computer design software, they have effectively reduced and improved the impact resistance of their most recognizable package ??“ the glass contour bottle.
Introduced in 2000, the Ultra Glass contour bottle is designed to improve impact resistance, and reduce weight and cost. Use of the Ultra Glass design has eliminated 52,000 metric tons of glass — resulting in a CO2 reduction of 26,000 tons or the equivalent of planting 8,000 acres of trees.
Throughout their system, they tailor their packaging to meet local economic, social and environmental needs, they adjust the amount of material used in PET bottles based on local temperatures to reduce packaging while maintaining product quality.While they have a robust sustainable packaging strategy, they faced litter issues in the communities they served. All too often their packages were found along roadsides, beaches or in waterways.They recognized the importance of working with community organizations to make it easier to properly dispose of their packages and to educate the public to change behaviors that cause litter on land and in bodies of water. Their system supports numerous litter prevention and community beautification organizations that provide leadership in this area.
Coolers play a key role in the world of refreshment. As a result of climate change issues and their commitment to reducing their environmental footprint, they are implementing energy-saving technologies in their coolers. They are achieving this by purchasing new, more efficient units or by developing energy-conserving tools where there is a gap. Second annual Greener Package Awards for packaging sustainability, earning both the Beyond the Package Award and Innovator of the Year was awarded to Coca-Cola for PlantBottle 30 percent plant-based PET bottle.
Consumers around the world are switching to juices and teas for health reasons, leaving soft drink sales falling. Coca-Cola has been growing its juice offerings. The new packaging includes Minute Maids well-known black-and-white logo and mixes in larger images of fruit and leaves. Other brands will have similar looks while maintaining their brand names.The company wants to use the success of the Minute Maid brand to grow all its juice products.The company developed the new packaging over several years, talking to consumers to find out what they want in their juice products, including having a deeper focus on health.Coca-Cola can also save money by having the same packaging for its juice brands because it will be quicker to react to efforts that work ??” and dont. It will also not have to spend time or money by having different packaging.