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Analyze your packaging like an investor

Analyze your packaging like an investor

Investors know that a product’s packaging is crucial to its success in retail. Within the hyper-saturation of the natural food and supplement markets, your packaging should strive to be economical while also embodying that which makes your product unique.

“It’s easy as an entrepreneur to get wrapped up in the design of [the packaging], and not really think practically about what [will happen] when it leaves my copacker, what does this mean when it leaves my manufacturing plant? And think about everyone that will touch the product, from suppliers to distributors to retailers to customers.”

—Ben Levy, Echo Capital Group

Part 1: Fundamental packaging elements for optimal shelf performance

Highlights:

  • Packaging is the touchpoint/billboard between the product and the consumer, and therefore is of a good deal of interest to the investor
  • Think about packaging as a way to clarify the brand’s ethos and message; it should portray the ‘soul’ of the brand
  • Whatever is unique to the integrity of the brand should be displayed outwardly on the packaging

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Part 2: How to think holistically about product packaging

  • Don’t get too wrapped up in the design aspect. Package cost, how it will fit on a pallet, air space within it, etc. are all going to affect eventual consumer interest
  • Packaging can help sway use—for example, a can of soup can be put away, but a soup container with a sippy cup lip urges the customer to consume the product right away
  • Don’t go against the grain when trying to fit into a certain category, e.g., if everything in the frozen entrée aisle is in a certain sized box, do the same to help optimize space for retailers
  • Brands should focus on where in the store as well as the particular store in which they want to be represented and design accordingly

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Part 3: Examples of package changes and why they had more of an impact on consumers

  • Expect to change your packaging a couple of times; most products go through several iterations before finding a great design that works on all fronts
  • Investors look at where the business is in its life cycle; in situations where a brand is in 10 thousand stores, a change in packaging could be quite expensive in order to replace the product
  • Make sure the copy on the package highlights the most important features and remains positive and accessible
  • It is very beneficial to have a good relationship with one’s marketing team. However, occasionally a product is so good that its success on the market does not depend on how ‘mom-and-pop’ the packaging is. 

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Part 4: Questions from the audience

 

This session—Investible Packaging: Make or Break Decisions that Influence Investment—was recorded at Natural Products Expo East 2018.

 

 

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