CHAPTER 31 Branding, Packaging, and Labeling

Pick a brand which is familiar.  Is selling a product, service, or idea?  Is it a name, term, symbol, or combination?  Does it identify 1 product? Family of products? Of whole company?  What benefits/features does the brand connote?

What is a brand?  Brand: name, term, design, or symbol (or combination) that identifies a business or organization  Important part of product planning  Distinguishes from competition  Can identify 1 product, family of related products, or all products made by 1 companyfamily of related productsall products made by 1 company  Can connote number of benefits (ex. Quality & Excellence vs. Fun & Exciting  Important Asset & powerful marketing tool

Elements of Branding  Need target market’s needs/preferences  Includes: Brand Name Trade Name Brand Mark Trade Character Trade Mark  Have Value & can be Global

Branding Terms  Brand Name: word, group of words, letters, or numbers representing a product that can be spoken  Should be:  Easy to recognize  Easy to say  Distinctive

Branding Terms  Brand Mark: the part of the brand that is a symbol or design  Usually not spoken 10 Most Recognized Brands

Branding Terms  Trade Name: identifies company or division of particular corporation. Legal name (e.x. Dell, Kellogg’s)  Trade Character: brand mark with human form (e.g. Bird’s Eye Jolly Green Giant, Kellogg's Tony the Tiger, Pillsbury Doughboy) Trade Character  Trademark: brand name, brand mark, trade name, or trade character, or a combination that is legally protected by the federal government (can trade mark sounds- Duck, fonts, colors, and smell-Mandalay Bay Hotel) Trademark soundsfontssmell

Why are brands important?  Builds customer loyalty  Assures customers consistent quality = reduced risk  Identifies firm that manufacturers product Helps address new target markets  Helps to establish an image for product or company  Note: Brand/slogan quizNote: Brand/slogan quiz

Generating Brand Names  75% of companies introduces a new product name yearly  U. S. Patent and Trademark Office registers 350,000 trademarks yearly  Some companies use software to develop name (check to see if name is already owned)  Other companies hire branding agencies, name consultants, or PR firms  60% Companies conduct research on name before released

3 Types of Brands National Brands: also called producer brands; owned and initiated by manufacturers. (Kraft, Whirlpool, Hilton, Avis, Ebay). Generate majority of sales for consumer products: 70% food, 65% appliances, 80% gas, & 100% car.  Private Distributor Brands: owned and initiated by wholesalers and retailers; private labels (e.g. Targets Xhiliration line of clothes, Sears Kenmore appliances). Manufacturer’s name does not appear on product.  Generic Brands: brands that represent a general product category and do not carry a company or brand name. (usually just state “pancake mix”, or “paper towels”)

BRANDING STRATEGIES  4 types:  Brand Extension  Brand Licensing  Co-Branding  Mix Branding

BRAND EXTENSION  Uses existing brand name for new or improved product in the product line  Ex: Nabisco extended to add different flavors to Fig Newtons  Problem: risk brand dilution (original brand loses strength because it is stretched too much to encompass different products.) Pampers Pocket Bibsters Strawberry Fig Newtons

BRAND LICENSING  Brand owner legally allows another company to use it’s trade character, brand, or brand mark for a fee ( royalty)  Enhances image of company and sell more of core products  E.x. McDonald’s paid $75 million to associate Happy Meals with the 2000 movie Dinosaurs

CO- BRANDING  Combines one or more brands to increase customer loyalty and sales for each individual brand.  Ex: GM and MasterCard joined to develop credit card without annual fee; Pop Tarts only use Smuckers Fruit Filling  See Pepsi/Yahoo Case study

MIXED BRANDS  Simultaneously offering a combination of national, private, and generic brands  E.g. Michelin manufacturers tires for Sears with the Sears brand name as well as under the Michelin brand name  Allows business to reach different target markets, maintain brand loyalty, and increase overall product mix. 7 all for Mankind $200 (fine retailers) Seven at Kohls $50

PACKAGING  Physical container or wrapping for a product  10 percent of product’s retail price is spent on package development & design

List examples of packages that…  Create a low product image  Discount merchandise image  High End merchandise image  Prestige Product image

FUNCTIONS OF PACKAGING  Promoting and selling the product  Defining product identity  Providing information  Meeting customer needs  Ensuring safe use  Protecting the product

PROMOTING and SELLING THE PRODUCT  Customer reaction to a product determines the success or failure of a product  Mixed bundling: Packaging different types of products/services together  Price Bundling: 2 or more are on sale for the price of 1  Need to be well-designed packages, attractive, colorful, & artistic  Better packages help create new sales and minimize possible losses  Yoplait Yogurt—upside down design

DEFINING PRODUCT IDENTITY  Used to invoke prestige & status in eyes of consumer  Very crucial advertising component  E.g. Dominos Pizza Box Saks Fifth Avenue Shopping Bags

PROVIDING INFORMATION  Package provides information for customer  Nutritional value, directions, & potential hazards  Universal product code placed on products to assist with inventory control and management Directions Bake cookies at 350 degrees for minutes or until golden brown.

MEETING CUSTOMER NEEDS  Product come in various sizes to suit different people  Family packs, lunch containers  E.g. Coke comes in six packs or cases  Must keep up with changing lifestyle

ENSURING SAFE USE  Can improve product safety for customer  Ex: many packages that used to be in glass now come in plastic, cosmetics come in tamper-resistant packages, & child-proof containers  Blisterpacks: packages with preformed plastic molds surrounding individual items arranged on a backing

PROTECTING THE PRODUCT  Package must protect product from harm during shipping & handling ( Also, food from spoiling)  Basic materials are wood, glass, plastic, and metal Aseptic Packaging: keeps food fresh w/out refrigeration

Creative Thinking 1. What else can it be used for? (W/out any changes) 1. What else can it be used for? (W/out any changes) 2. What could be used instead? What else is like this? 2. What could be used instead? What else is like this? 3. How can it be modified for a new use? 3. How can it be modified for a new use? 4. What if it were larger (thicker, heavier, stronger)? 4. What if it were larger (thicker, heavier, stronger)? 5. What if is were smaller 5. What if is were smaller ( thinner, lighter, shorter)? ( thinner, lighter, shorter)?

PACKAGING ISSUES  Environmental Packaging: recent polls show most Americans prefer less harmful packages. Companies make recyclable & reusable packages.  Can recycle most plastic containers  Cause Packaging: companies use packages to promote social and political causes.  Ben and Jerry’s promotes saving the rainforestsBen and Jerry’s Stoneyfield Farms donates 10% Earth Restoring Companies

LABELING  Information tag, wrapper, seal, or imprinted message that is attached to a product  Informs customer of contents and directions for use  Protects business from legal liability  contain brand name, logo, ingredients, promotional messages.

Types of Labels  Brand Label: brand name, trademark, or logo Ex. Chiquita Bananas are stamped  Descriptive Label: gives info about product use, construction, care, and performance Ex. Food products have illustrations, weight, date and storage, ingredients, guarantees, and manufacturer’s name and address  Grade Label: quality of product. Grade AA, A, B, C, D, or E (editable)

LABELING LAWS  Federal nutrition labeling and education act passed in 1994  Protects consumers from deceptive labeling regulates use of terms such as light, fat free, low, reduced  Must put warnings on Alcohol for pregnant women and cigarettes for cancer

Labeling  Federal trade commission labeling rules & guidelines  Care labels must be placed in clothing  Ensures that specific detailed information about the care of garments related to washing, ironing, and cleaning directions  If put the term recycled content- must show proof of it. Same with the use of terms such as ozone safe, degradable, and biodegradable

Packaging Types  Skin packaging- plastic film mounted tightly over product & mounted on a card. Visible, clean, card gives rigidity (napkins, knee highs)  Blister - plastic bubble placed over card  Aerosol/ pump dispenser- releases its contents when value is pressed (Hairspray)  Flexible pouch- formed from plastic film that is filled with product and sealed with heat (Nutrigrain bar, cereal)

Package Types  Shrink wrap- made by placing clear film around the product itself. It fits the contour of the product  Multipack- Special package design that groups two or more products into a unit for easier display, carrying, or convenience  Aseptic packaging- keeps germs out of food that needs no refrigeration (Velveeta)  Dispensing closure- cap or lid in which contents can be dispensed in controlled manner (lotion)

Designing the package  Promotes product acceptance  Promotes a company and image  Gives old product new image  Preserves product  Helps customers use old products better  New uses for products  Reduces costs  Increases sales & profits