7. In the growth stage the company faces a trade-off between ---------- and.

8. Products that withstand the heat of competition and enter the---------

.
9. In the maturity stage the marketer should also consider entering ----------, product and
marketing mix to fight competition.
10 -------- and brands enter into decline stages while product categories last longer.
Answers:
primary demand, 4. Selective demand, 5. introductory
stage, 6. growth stage, 7. high market share, high current profit, 8. maturity stage, 9. New
market, 10. Product forms

SESSION 4: PACKAGING AND LABELLING

INTRODUCTION

Packaging can be defined as an art, science and technology of preparing goods for transport and
sale. Packaging as an industry has two sectors those who prepare the packaging material and
those who convert these materials into packages. New packaging materials are fast replacing the
old ones. A good packaging conveys the quality of the product: which is distinct from the value of
the product. Attractive packaging is an also an efficient point of purchase (POP), and stimulates
publicity for sales. It has been observed that packaging is an important advertising means helping
in carrying messages from the marketer to the consumer. Packaging as a function has two separate
dimensions the physical aspects related to the science and technology and the behavioral aspect
related to the art of product design associated with buyer behavior.

PACKAGING CONCEPT

value to the product and there are three levels of material for package:

A. A primary package
B. A secondary package
C. The transportation package

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bottle, tetra pack, can or a box: or secondary, which refers to additional layers of protection that
are removed once the product is ready such as the tube of shaving cream, which is covered in a
card board box or a glass bottle covered in card board box.

The different levels of packaging, type and importance would vary with the nature of product,
whether FMCG, durable consumables, industrial and liquid product. It would also differ on the
distance over which it has to be transported. It should be regarded as one of the important
requirements for a manufactured product. The quality control of a product would be meaningless
if the package designed to carry the product from the factory to the ultimate consumer is not
adequate.

ROLE OF PACKAGING

Packaging is an important element in the formulation of the marketing plan as it aids with
promotion & performs the role of passive salesman, in addition to protecting the product. In the
absence of salesman, the package should be able to grab the eyeballs of the buyers. Good
packaging may lead to improved consumer acceptance.

The product package has an important promotional function, establishing meaningful

communication with the consumer. Designing the product package according to changing
customer preferences and attitudes will enable the marketers to push the product.

Consumer packaging is also intended to offer better convenience to the consumer and protect the
product from pilferage and damage. It has been estimated that unit value realization can increase
with good packaging.

IMPORTANCE OF PACKAGING

Initially Packaging was considered a production-related function and activity. While in the current
context packaging has completely changed due to competition. New developments in packaging,
have forced marketing managers to focus on packaging design. The following aspectshighlight
significance of packaging in marketing:

It provides information about the product

It helps in identifying brand name
It assists in protecting the product
It helps in product handling
It aids in promoting the product
It helps in offering customer convenience and satisfaction
It helps increase in the sales of the product.
It adds to the use of a product.
It contributes to the safety of a product.

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 It helps in storage of the product
It helps in product differentiation

PACKAGING DECISIONS

Packaging is an important component of a product as an attractive pack is the most important factor
in impulse purchases. The basic functions of a pack are to attract the potential attention,
protect the product that is packed and reveal its identity. It is an essential tool for two categories
of people first, end-users of a product: and second, retailers. The material used may vary from
metal to paper to plastic etc. The useful packaging decisions include:

1. Packaging design: It is not easy to design a package for various items. For example, all

The high costs of packaging lead to bringing out refill packs too.

2. Attractive Color: Colour plays an important role for determining customer acceptanceor
rejection of a product. The use of rightcolours in packaging also assists marketers, reap
huge advantage. Packaging colour should be attractive so that it may aid in promoting sales.

3. Packaging the product line. A company must decide whether to develop a family or
similar kind of the packaging of its several products. It involves the use of identical
packages for all products or the use of packages with some common feature.

FUNCTIONS OF PACKAGING

Packaging should perform the following basic functions:

1. Protection
The basic function is to protect the products from the vagaries of weather the product can

related to handling the product while on display on the shelves.

The reasons for protection for products through packaging are:

Control pilferage during transit or storage
Prevent the absorption of moisture
Avoid breakage/damage due to rough mechanical or manual handling during
transit.
Protect liquid from evaporation.

2. Appeal

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 The emergences of self-service outlets have forced manufacturers to have attractive
packaging. The following characteristics have been identified to help a package perform
the self-selling tasks:
It helps in attracting attention of the customer
It helps to enhance the product image
It helps in the product looking and hygienic

3. Performance
This is the third function of a package. It should perform the task for which it is designed.
Bottled water has been introduced in 500 ml to 20 litres bottles. The purpose and place of
use is the deciding factor in the purchase of various packs. A package must be made to
consistent and rigid quality standards as the consumer demands uniformity each time he
purchases a product.

4. Packaging for convenience

It provides convenience to distribution channel members, such as wholesalers, retailers and
consumers. The convenience will relate to handling and stocking of packages. It helps in
the following ways:
The package must be convenient to stock
The package must be convenient to display
The package must not waste shelf-space.
The package can be easily carried.
It should be easy to dispose off.

5. Cost-effectiveness
The package finally must be cost-effective. Packaging cost as a percentage of product cost
differs from one industry to another. It is essential to understand that while analyzing
packaging costs, the other costs like handling, storage, insurance and transit costs are also
added.

QUALITIES OF GOOD PACKAGING

Attractive appearance
Convenient for storage and display
Shield against damage or pilferage
Product description displayed on the package
Package should be as per the specifications

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Types of Packages
There are four types of packages: (i) A consumer package (ii) a bulk package, (iii) an industrial ,
and (iv) a dual usage package. They are as discussed.

(1) A consumer package is one which holds the required volume of a product for ultimate
consumption is economical and can be easily purchased by the consumer. He has the option to
purchase the pack size which he considers adequate for the consumption for his family over a
length of time and does not involve additional investment during that period.

(2) A bulk package is either for the consumer whose consumption is large or is bought to save
cost. Example: oil cans etc. The consumer package itself very often requires an outside package in
which it is transported and which is sometimes referred to as transit package or an out container.

(3) An industrial package can be a bulk package for durable consumer goods. These are the basic
package types although many sub-divisions can be listed, e.g., strip package, multiple package,
etc., which can all be broadly listed under these basic headings.

(4) A dual use package is one which possesses a secondary usefulness after its contents have been
consumed. Drinking glasses, boxes of jewellery or cigarettes, plastic containers, refrigeratordishes,
bags from flour and feed sacks are the examples.

LABELLING

LABELLING Labeling is regarded as part of marketing as packaging decisions involve the

labeling requirements. It provides the customers with the requisite information about the product.
The buyers also have complete information about the quality, features, standards, grade, price
quantity etc. This helps them in making better and informed decisions. It is also helpful to the
sellers as they can differentiate their products from their competitors. Attractive labeling also
assists in encouraging the customers to pick the products off the shelf. In most countries across the
globe, labeling is mandatory and they have specifications for labeling. For example in India, all
the prepackaged foods sold in the country are required to comply with the Food and Safety
Standards (Packaging and Labeling ) Regulations 2011 issued by the Food Safety and Standards
Authority of India functioning under the Ministry of Health and Family Welfare. The important
ones include information regarding the nutritional values, vegetarian and non-vegetarian symbols,
information related to food additives or flavors, name and complete address of the manufacturer,
net quantity, lot identification of batch identification, date of manufacture or packing, instructions
for use, country of origin for imported products apart from the general labeling requirements. The
CE marking or the estimated sign used in European Union weights

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and measures accuracy regulations. The Green Dot is the example of environmental symbol.
According to the regulations labeling of food items should disclose information about a number of
aspects like date of manufacturing, expiry date or optimum storage period for the product whichdo
not have an indefinite storage period, composition, storage conditions, necessary method of use, if
necessary, precautions to be taken, contra-indications etc. Labels are part of theprinted material on
the package. The label is a strong sales tool and an integral part of purchase advertising.

Products may be adequately identified by giving the name of the product and the producer; most
require somewhat more extensive descriptions of their nature and use. For example, processed
foods, patent drugs, some cosmetics, etc. legally are bound to carry a fairly complete detail about
their ingredients. Several products must give instructions for their use, as in the case of commercial
plant food. Safety warnings should also be mentioned on labels of all potentially hazardous

keep out of reach of Cigarette smoking is injurious to

-
awarded on the basis of a environment friendliness.

A good label is one which helps a potential buyer to help him take make decision with relevant
and correct information. Apart from the information which must be given, the label should provide:

i. Picture of the product accurate as to size, colour and appearance.

ii. Description of ingredients used along with methods of processing.
iii. Directions for use, including cautions against misuse.
iv. Brand names
v. Dates of manufacture and expiry
vi. Statutory warning, if any.
vii. Contra-indications and adverse effects, if any.

In all packaging is an important component of marketing and manufacturers are coming with
innovative packaging to attract the customer and labeling enables them to comprehend the
materials used in the product.

Role of Labeling
(i) Provides description of the product and specifies its content: The label provides
detailed information of the products, its ingredients, usage, care to be administered,

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 caution, batch number, manufacturing place, helpline number in certain cases, date of
manufacturing and expiry etc.
(ii) Identifies the product or brand: Labeling enables to identify the product amongst the
multiple brands. SUNFEAST brand of biscuits can be easily identified from the other
brands on the basis of their labeling.
(iii) Aids in product grading: If a company manufactures different qualities of product,
labeling aids in finding which pack contains what type of quality. The variants of tea
manufactured by Hindustan Unilever Ltd are differentiated by the company through
green, red and yellow colored labels.
(iv) Facilitates in the promotion of products: It also helps in sales promotion. Consumers
are to drawn towards buying products on account of their attractive labels.
(v) Helps in providing information required as per the law: The labels provides
statutory warnings as required by the law in case of products like cigarettes, pan
masalas. They are required to carry the picture and the warnings too. In the case of
hazardous or poisonous products too necessary statutory warnings are to be put on the
label.

William J. Stanton classifies the labels into four:

a) Brand labels: They are majorly meant to popularize the brand name of the product.
Cosmetics manufacturers prefer to use this kind. E.g: Perfumes, Lipsticks etc

b) Grade labels: They emphasize on standards or grades used for product identification.E.g:
Fabric, Tea Leaf, etc.

c) Descriptive labels: They are descriptive in nature; state product features and explains the
various uses of the products. The consumables items like milk etc have descriptive labels.

d) Informative labels: The main object of these labels is to provide maximum

possibleinformation. In case of the medicines, detailed labels are attached which even specify the
side effects in using them.

KNOWLEDGE ASSESSMENT 4

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Fill in the blanks
1. Packaging cab be defined as an art, science and technology of preparing goods
for transport and sale.
2. Attractive packaging is an also an efficient .
3. Marketers define packages as the of marketing.
4. Packaging may be which refers to the immediate container.
5. Good packaging may lead to improved .
6. Consumer packaging is also intended to offer better convenience to the consumer and
protect the product from .
7. plays an important role for determining customer acceptance or rejection of
a product.
8. A is one which holds the required volume of a product for ultimate
consumption is economical and can be easily purchased by the consumer.
9. A is either for the consumer whose consumption is large or is bought to save
cost.
10. Environmental awareness among the consumers has promoted the introduction of
awarded on the basis of a environmental friendliness.

Answers 1. Packaging 2. Point of purchase 3. consumer acceptance.6

pilferage and damage. 7. Colour 8 consumer package 9 bulk package 10 -

QUESTIONS

Q.1. Define a product. What are the various viewpoints to explain the concept of a product?

Q.2. Discuss the core tangible and augmented product for your favorite brand of bathing soap.

Q.3. Distinguish between generic market and product market.

Q.4. Packaging is considered as the 5th P of Marketing Mix. What are its implications on the
PLC? Discuss.

Q.5. Discuss the importance of packaging as a tool for foe product differentiation and market
cultivation.

Q.6. has been criticized as being expensive, giving no additional value and often
How would you justify marketers use of packaging?

Q.7. What is packaging concept? Explain various packaging decisions in brief.

Q.8. What are the functions of packaging? Explain various packaging strategies.

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