Wednesday, March 05, 2008

When high-tech packaging crosses the line into "retail media"

For most big CPG companies, package design almost assumes the status of "black art," and is relegated to a team of highly specialized designers and engineers who know how to get the most branded surface area out of a few the square inches that the typical product must occupy for it to be economical for retailers to carry. Consequently, we've seen some extremely creative packages crop up here and there that go the extra mile to really try and get the passing shopper to stop and take notice. For the most part, though, packages still tend to be pretty bland and generic-looking.... in fact I'm having a hard time wracking my brain to try and think of a good example of exceptional product design.

That aside, some folks are clearly thinking out-of-the-box about what they can do to make their products look more exciting and inviting on the shelf, and the New York Times just wrote a story about one such success, a new shaving gel called NXT.

While I don't know anything about the product itself, it's really the packaging that's the star, and in the already-crowded world of men's grooming products, it was ultimately this package that convinced Target to bother carrying the item (a new product from a small company, so this is no small feat!). How did they do it? The Times recounts this anecdote:

ABOUT a year ago, when Jamie Leventhal was trying to convince big chain stores to stock his new line of shaving gels for young men, a buyer for Target asked a crucial question: How much would he spend on advertising?

“I told him we would not spend a single dollar,” Mr. Leventhal said.

The buyer was stunned until Mr. Leventhal pulled a prototype out of his briefcase. The product, called NXT, is sold in an arresting triangular container that lights up from the bottom, illuminating air bubbles suspended in the clear gel. The plastic is tinted blue, and when the AAA batteries in its base are lighted, the whole thing looks like a miniature lava lamp or a tiny fishless aquarium.

The novelty of the light-up container worked, and NXT’s shaving gel — as well as its after-shave and face wash, similarly packaged — will hit the shelves at Target this month.
To call attention to themselves, the products, which are aimed at 18- to 24-year-old men, will glow on the shelves, inviting customers to pick them up. Every 15 seconds, a light-emitting diode (LED) in the bottom of the container flares on, stays lighted for a few seconds, then fades out.
The most interesting part of the whole story (to me) is that Leventhal identified advertising as a problem, and not a solution. Thus, rather than dump a whole bunch of money into advertising the product in the "usual" places (on TV, print, radio and the Internet, all of which require dozens to hundreds of individual ad buys for maximum coverage), he instead spent his money on getting his product noticed at the one place where it really counts -- at the store, where you can actually buy it. Further,
While most brands want to be placed at eye level or higher, Mr. Leventhal said the ideal shelf location for NXT is lower. “When you look down at them it’s more dramatic, so what I’m doing is going into retailers and saying, ‘Let’s take the less valuable real estate on the shelf and make it more valuable,’ ” he said.
So the package is even more appealing to retailers who vary their slotting fees based on shelf location (which is pretty much all of them these days).

I think NXT is probably going to do well thanks to their in-store strategy, even despite their lack of traditional advertising. However, now the bar has been raised. I'm pretty confident that Target isn't going to want a dozen different products blinking up and down each of their aisles, and for brands that are already spending a lot on advertising, the additional packaging costs for this type of gimmick may be prohibitive. But considering that hundreds of new brands are launched every year -- many from smaller companies that don't have the budget of a Unilever or a P&G -- I expect that we'll see a lot more creative packaging-as-promotion ideas in the future.

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