Branding, Packaging and Labeling

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Branding, Packaging and Labeling
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Topics

• Branding
• Importance
• Types
• Strategies
• Packaging
• Function
• Issues
• Labeling

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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

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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

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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

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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

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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

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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

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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

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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

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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

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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

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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

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Packaging

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

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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.

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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

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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

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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 Jerrys, Body Shop

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Labeling

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

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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

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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

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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

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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

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Labeling Laws

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