CONSUMER INSIGHTS

OVERCOMING

by Scott Young

THE ODDS
N

Five principles for packaging

new products effectively.
Its vital for new products to embody a dimension
visually. A new structural delivery system, such as this
innovative approach from consumer health product
Alli, strongly signals innovation.

ew products are the lifeblood of nearly every

companys growth strategyand the source
of enormous investments in development,
research and advertising. Yet despite these
efforts, its undeniable that the overwhelming
majority of new products fail. In fact, most
sources put new product failure rates at more than 80 percent
and fewer than five percent are considered clear successes, with
$50 million or more in first year sales.

New product success is largely dependent on effective packaging.

For established brands, many shoppers come to the shelf looking
for the productand the primary role of the packaging is to
ensure recognition that it is indeed the brand and product people
know and trust. New product packaging, however, faces a
different (and far more demanding) set of challenges.

1. SHELF VISIBILITY
(UNSEEN IS UNSOLD)
Without question, the most decisive driver of new product
success is shelf visibility (i.e., the likelihood that a product will
be actively considered by shoppers). Indeed, across our studies,
weve seen a consistent and direct relationship between shelf
visibility and purchase levels.
This linkage should not be surprising: Despite advertising
support, the reality is that very few shoppers come to the shelf
looking for a new product. Thus, new product packaging must
break through clutter and force consideration.

This can be daunting, because new products often have limited

shelf space, perhaps two to three package facings within a sea
of hundreds of products. In fact, our studies typically find that
new product visibility is at 33 percent or lower.

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This reality helps to explain why studies that are based on

forced exposure greatly overstate sales projections for new
products. They dont take into account the fact that nearly twothirds of shoppers will never even see and become aware of the
new product! Overall, most new product failures are not a result
of shoppers actively considering (and rejecting) a new product
proposition. Instead, they are a function of new brands getting
lost on shelf and never being considered by most shoppers.
So what is the best way to maximize shelf visibility? The one
word answer is contrast. Visual contrast (relative to other
brands on shelf) can come from several sources, which typically
include color blocking, the use of unique packaging structure
and/or a very bold visual icon.
As a rule of thumb, color is the strongest tooland the smaller the
brand, the more important it is to own a color on shelf.
While there is no magic color for creating contrast, we
can say that the best solutions often involve breaking the
rules of the category.
Wrigleys 5 gum is an excellent example, as it broke
from category norms of colorful packaging that
suggest flavor to own the color black within the
gum display.

2. DIFFERENTIATION
While it may be intuitive that a new product must be unique,
weve found that differentiating (versus the competition) in an
extremely clear, visibleand ideally visceral or emotional
manner is critical to success.
New products face a very difficult task in trying to change shoppers
ingrained behaviors and thought processes, often in low-involvement
categories. Given these barriers, a new products distinction has to be
immediately apparent. At a minimum, new CPG products/packages
must pass the five-second test. They must convey a clear point-ofdifference in this limited time frame, which is how long shoppers
typically take to actively consider a package, before deciding whether
it should go in the shopping cart.
This fact points to another reason why many studies overstate
new product success. They are based on extended exposure to
new products, often in the absence of competitive options,
which is simply not reflective of the shopping experience.
Of course, there are many strategies for differentiation, but the most
effective start with truly innovative product propositions that slice
categories in new ways and speak to shoppers underlying concerns.
For example, the success of the 100 Calorie Packs brand was
driven by its unique delivery of an underlying consumer benefit
(portion/calorie control) through innovative packaging.
When we observe shoppers in the aisle, we often see a disconnect
between shoppers priorities and what these people encounter at
the shelf (a plethora of features/benefits, flavors and subbranding). Thats why we find many successful innovations break
through the clutter by linking more closely to the shoppers
mindsetand by speaking directly to specific usage occasions (e.g.
on-the-go packs, packs designed for school lunches, etc.)

On a packaging level, it is vital for new products to embody a

dimension visually, by looking more premium (or more fun, or
more appetizing, etc.) than competitive brands. Weve found that
structural innovation is the strongest strategy across categories in
this regard; it is difficult to do this using just graphic changes
when you are trying to differentiate on an emotional level.

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PRS Eye-Tracking studies

consistently find that
less is more. Adding
packaging claims reduces
the likelihood that a clear
point of difference
will make it through
the clutter.

However, a new structural delivery system (such as that for the

consumer health product Alli) strongly signals innovation
upon an initial glance.

3. VERSIONING
A third challenge for new product packaging is what we call
versioning, which refers to working effectively within a
larger brand family.

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Weve seen many companies err on the side of visual

differentiation, by making new product packaging differ from
the base across multiple dimensions (new colors, new brand
identity, new labeling architecture, etc.). The result has often
been confusionand a default to the familiaras shoppers
have not known how to define the new product (How is it
different from what I use today? Is it still right for me?).
This is particularly common when the labeling architecture, or
placement of information, on the new product packaging differs
from that on the base brand. Shoppers cant quickly compare the
two packagesthe new product versus the current product.
Often, weve found that the right answer is typically at least
50 percent visual continuity from current (to leverage brand
equity), varying one primary design element (such as color or
structure) combined with a very clear emphasis on the new
products point of difference.
In fact, its particularly effective when the new product name
itself conveys or embodies the products reason for beingand
is visually accompanied by a brief definition that speaks to its
use or importance.
The packaging of Tide Coldwater illustrates this point, and
does a very good job of managing this balancing act between
visual continuity (via the familiar Tide logo) and
differentiation (via the unique color).

4. REASSURANCE
A fourth challenge for new product packaging is providing
shoppers the key reassurances they need to make a new
purchase. Here, its important to remember that many shoppers
are buying for others and a driving factor/consideration is the
desire to avoid making a mistake.

OCT/NOV08

As a rule of thumb, color is the strongest tool to

maximize visibility. Wrigley 5 gum broke from
category norms of colorful packaging to own
the color black on the gum aisle.

Of course, this dynamic works against new product trialand

it means that new product packaging has to work much harder
to convey added value and provide needed information.
For marketers, this creates the strong temptation to fully
explain new product benefits and include every possible claim
on pack. However, when marketers try to do too much on
packaging, the result is nearly always self-defeating clutter.
In fact, our studies consistently illustrate the fact that less is
more in terms of packaging claims. Specifically, we find that
adding claims or messages does not drive higher package
viewing times. Instead, more messages simply compete for the
same four to five seconds of attention and reduce the likelihood
that any single message will come through. Its also dangerous
to rely on the back panel for important information, because
in-store observational research reveals that only 10 to 15
percent of shoppers consistently check back panels.
Of course, theres no easy answer to this reassurance challenge,
other than to approach packaging development with a clear
understanding of the hot button issues within a given category.
In other words, its a matter of sorting and prioritizing the need
to know information (potential deal-breakers) from the nice to
know information (additional claims). In our experience, weve
found that most critical reassurances relate to compatibility (i.e.,
Will it work with what I have today?) in technology categories and
to users/usage (i.e., Is it appropriate for my child?) in other
categories, particularly OTC pharmaceutical products.
Perhaps most importantly, its critical to test new products
without the benefit of extended concept statements or
commercials. For the shopper, the package is the concept
statementit is all that he or she is likely to encounter at retail.
If the package leaves key questions unanswered, this must be
corrected in advance, before its too late.

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With regard to packaging, new products involve a more delicate

balancing act than entirely new brands. On the one hand,
there is a need to leverage the equity of the established brand,
which typically involves some visual continuity (i.e., the same
logo, color scheme, etc.). On the other, there is the need to
visually distinguish from the base, in order to drive visibility,
awareness and consideration.

Most new products are sub-brands or line extensions, which

means that they are typically speaking to brand users who are
considering the new product in the context of what they normally
buy. As noted earlier, weve found that new products tied to users
and usage occasions are typically more intuitive to shoppersand
thus more successful at driving incremental purchases. Conversely,
shoppers often have a more difficult time accepting premium line
extensions, and understanding good, better, best strategies.

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5. PRODUCT DELIVERY
A final (and often overlooked) challenge is for packaging to
create realistic expectations about the product inside. Its a
mistake to ignore this issue or to dismiss it as a product
quality/delivery issue that falls outside the purview of the
packaging development or design team.
The reality is that when shoppers buy a new product, they are
bringing with them a set of expectations created largely by the
packaging (visuals, claims, etc.). Their satisfaction (or lack
thereof)and their likelihood of re-purchaseis a direct

function of any gap between these expectations and the

product delivery. Thus, as the old adage goes, the best way to
kill a bad product is through a good package.
Of course, this is not an argument in favor of making less
compelling, and perhaps more realistic, packaging. However, it
does speak to the importance of being as descriptive and
informative as possible. In our experience, more direct, literal
approaches are less likely to confuse or mislead than more
abstract approaches in the treatment of primary visuals,
naming/sub-branding, etc.
Perhaps more importantly, this issue
illustrates the need to test new
products holistically and from the
outside-in, in a manner that mirrors
the shoppers experience of
seeing/buying the packaging and then
using the product.
Too oftenand most notoriously with
New Cokeweve seen situations in
which product testing is done on a
blind basis, with terribly misleading
results. Similarly, weve seen cases in
which new product packaging was
compelling, but not consistent with the
product propositionand thus likely to
sell only once.

INCREASING
THE ODDS
The odds against new product success
are undoubtedly high. Moreover, its
clear that effective packaging (which
meets the challenges of visibility,
differentiation, versioning,
reassurance and product delivery) is
absolutely essential, while weak
packaging can break even the most
compelling concept.
Thus, if success rates are to improve,
the single most important first step
will be for marketers to recognize that
the package is the productand
change the role of packaging within
the new product development cycle.
Today, packaging is often the last step
of an extended process, but after years
of new product development and
concept testing it is likely to be rushed

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Sub-brands and line extensions must leverage the

equity of the established brand while still visually
distinguishing themselves from the base. Tide Coldwater
does a good job of managing this balancing act between
visual continuity and differentiation.

into several months to meet an introductory deadline. In the

future, these elements must be better integrated, with a greater
emphasis on shelf presence and packaging communication.
Secondly, significant improvements are needed with regard
to how new products are tested. The research process needs
to better replicate the manner in which shoppers actually
encounter new products: as packages; on shelves; within
competitive context; and without the benefit of explanations,
commercials or concept statements.
Taken collectively, these changes reflect a fundamental shift
away from an inside-out approach to new product
development that is centered on the product and concept
towards an outside-in process that is focused on the
packaging as the driver of expectations and satisfaction.
The result will be a far more accurate sense of performanceand,
I believe, ultimately a much higher rate of new product success. BP

The author, Scott Young, is the president of Perception

Research Services, a company that conducts more than
600 studies annually to help marketers develop, assess
and improve packaging systems. Contact Scott at
syoung@prsresearch.com or 201.346.1600.

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