September 16-17 marked the 2008 Contract Packaging Conference in Chicago — a meeting place for the who’s who of packaging and this year Australia had something to offer.
Brad Devine, Managing Director of Australia’s promotional Packaging Specialists, Creative Pack, attended as a guest panellist to offer an Aussie perspective on club store trends and the consumer experience.
Devine joined key industry figures like Joe Jaruszewski, President of Market Resource Packaging, to discuss Creating the Right Treasures for the Treasure Hunt or more specifically the ‘Treasure Hunt’ approach.
This phrase, coined by Wal-Mart, to describe their goal of surprising and delighting customers with new and unexpected products each time they visit the store, is certainly something the Australian industry has been forced to adopt.
Market product saturation, matched with demanding and sophisticated Australian consumers necessitates more from consumer brands’ on-shelf packaging, product placement and creative in-store promotions.
Having worked with leading Australian consumer brands for almost 20 years, to provide both packaging advice and a specialised contract packaging service, Devine certainly had a great deal to offer.
He addressed best practice for consumer packaged goods companies and contract packagers to meet the challenges and opportunities presented by retailers and adoption of the ‘Treasure Hunt’ approach.
The four prominent themes which arose in the panel discussion and conference debates generally were
1. Innovation- Packaging innovation is essential to overcome business challenges presented by unstable economic conditions & growing economic pressures.
This is contrary to the traditional school of thought of packaging as an expense.
The conference challenged the assumption that now is the worst time for packaging innovation.
Innovation provides functional consumer benefits, creates tangible brand experience, drives environmental sustainability, delivers significant productivity savings & provides opportunity to be transformational & even inspire new product forms.
2. Partnering - or buyer- supplier relationship management is an important strategic priority for businesses today.
It is through the efficient and effective management of relationships between contract packers & consumer packaged goods companies that competitive advantage can be achieved and real added value and cost savings realised.
The quality and effectiveness of each relationship is affected by the level of commitment, communication, trust, collaboration and power balance which exists.
To forge stronger exchanges and reduce overall cost and time-to-market companies must:
* involve contract packers in product planning and development (and much earlier than they typically do);
* meet with partner to establish relationship expectations;
* develop long-term contract agreements that create mutual value;
* assign individuals to manage relationships;
* emphasise trust building activities and actions;
* practice cooperative cost management approaches;
* provide resources to develop suppliers performance capabilities and
* establish cross-functional teams.
3. Sustainability- Contract packaging can and should play an important role in the fast-growing sustainable packaging trend simply because “green” is here to stay.
According to presenter Dennis Salazar, President & Founder of Chicago based Salazar Packaging, Inc. Green is here to stay because it’s generational, cost efficient and profitable, irreversible in the publics eye and is what consumers are demanding and buying.
Companies can and should embrace sustainability for image and PR reasons, to satisfy customer driven green initiatives, for the sake of employees who are also consumers and for cost savings.
Salazar presented an interesting challenge that if embedded in corporate culture and thoroughly planned- Green does NOT have to cost more!
4. Retail Trends- The 'club store' phenomenon is a fast grow retail trend in the USA, fuelled by dire economic instability.
Over the past 4-5 years the prominence of club stores has increased as companies move away from above the line marketing and seek highly targeted sales promotional strategies.
Synonymous with bulk, multi-packed discounted consumables, club stores present a challenge for contract packagers to support Consumer Packaged Goods as they deliver 'mass customisation' to club store retailers.
The future of contract packager is promising if they can respond rapidly to changing trends, deepen buyer-supplier relationships and embrace innovation and environmentally friendly practices for the cost saving and consumer benefits these afford.
And for those who bothered to read on, here’s a secret- The US Club stores player Costco arrives in Australia in 2009 with plans for multiple stores.
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