Every natural products company needs to be vigilant when it comes to their packaging design. You might get lucky and create an iconic looking brand that is immediately identifiable. First one that comes to mind is Dr. Bronner’s liquid soap. No one would claim this to be an elegant design, but it’s immediately recognizable. And we wouldn’t mess with it. Nope.
But for many other natural products brands, there can come a time when the initial packaging no longer represents where the company is in relation to the rest of the market or in relation to its core brand. At this juncture, companies either consider a small makeover, a slight refresh or a major redesign. To help with their decision making, they might conduct some market research. They also could be planning for a major shift in their product offerings either through product innovation or acquisition.
Regardless of what they choose to do, whether it’s a major rebranding and package redesign, a new product introduction with a fresh new design or a small makeover, these branding and packaging endeavors are costly and create tension within companies. How can you be sure the rebrand is going to increase sales? How will your customers respond to the new packaging? Will they be able to find it? Will you lose what brand equity you have or will you be able to build off of it?
Redesign Impacts Sales
In our Natural Products Marketing Benchmark Report 2015, we asked respondents about their most recent branding and packaging efforts and the impact that these had on their sales.
One question we asked respondents was “What happened to your sales following the placement of your redesigned packaging?” The first thing that stands out from the collected data is the number of respondents who were not sure! The vast majority of natural products marketers (88%) think ROI is very or moderately important, and yet so many are not sure whether their new designs impacted sales. Yes, we recognize that that there are often many factors that go into increased or decreased sales, but packaging is such a critical one that it seems almost absurd not to track its effect.
For those who did monitor their sales after a redesign, however, the overall figures are encouraging. Only 4% saw a decrease within the first three months. Interestingly, when we look at those who undertook a major redesign of the entire product line, there was slightly more likelihood that they would experience a decrease in sales during the first three months (8% versus 4% for the other types of redesigns). This decrease could be explained by the fact that consumers need time to adjust to the new design, especially if it’s quite different. In our own experience, this is typically the case, and we always advise clients to take this into account when sales forecasting. When we get to 4 to 6 months, however, the data shows greater increases, with only 15% experiencing a decrease or no change in sales, which is also what we’ve encountered personally.
And for those who took the leap of major redesign? The decreased sales difference fell away from 4 to 7 months. At this point, a major redesign of the entire product line became more likely than average to be associated with increased sales (60% versus 45% for the average of all types of redesigns). At 7 months to 1 year, a major redesign was still associated with increased sales more than most redesigns (51% versus 42%).
It is also important to note that those who conduct ongoing tweaking of packaging were less likely to be associated with increased sales than those who undertook minor to major repackaging.
At every time point, a major redesign of a specific line of products was more likely than the other package redesigns to be associated with increased sales (50% versus 33% in the first 3 months, 53% versus 45% in months 4 to 7, 56% versus 42% at 7 months to 1 year, and 47% versus 29% at 1 to 2 years). This indicates that redesigning a specific product line can help it to take off.
Key takeaway: research in conjunction with a redesign pays off.
One key takeaway from our research was that using research in conjunction with a redesign pays off. We discovered that using online consumer surveys was associated with packaging redesign success. 80% of medium-size companies (Annual revenues between $1 million to $15 million) who did online consumer surveys experienced a sales increase versus 40% of those who didn’t do online consumer surveys.
What are your experiences with package redesign? Did you experience an initial dip in sales before you enjoyed increases? Or are you still on the fence and not sure whether to do a major or minor redesign? Let us know.