packaging in an online world

Packaging in an online world

Defining the role of packaging as part of the online shopping experience

White paper | November 2011

Shikatani Lacroix is a leading branding and design firm located in

Toronto, Canada. The firm specializes in creating lasting first

impressions for brands through design innovation. The company

was first to coin “the Blink Factor” which identifies how brands

effectively connect with consumers in a complex and cluttered

world. The company has commissioned assignments from all

around the world, across CPG, retail and service industries, helping

clients achieve success within their operating markets. It does this

by enabling its clients’ brands to better connect with consumers

through a variety of core services including corporate identity,

naming and communication, brand experience, packaging, retail,

wayfinding and product design.

About the Author

Jean-Pierre Lacroix, R.G.D., President and Founder of Shikatani Lacroix

Jean-Pierre (JP) Lacroix provides leadership and direction to his

firm, which was founded in 1990. He has spent the last 35 years

helping organizations better connect their brands with consumers

in ways that impact the overall performance of their business. Mr.

Lacroix was the first to coin and trademark the statement “The

Blink Factor” in 1990, which today is a cornerstone principle to

how brands succeed in the marketplace. JP has authored several

papers, has been quoted in numerous branding and design articles

and, in 2001, he co-authored the book “The Business of Graphic

Design,” which has sold over 10,000 copies. Most recently, he has

authored a new book “Belonging Experiences...Designing Engaged

Brands” (amazon.com) on how brands need to effectively create

meaningful relationships with consumers. JP can be reached at

[email protected] and you can follow his blog at:

www.belongingexperiences.com. You can also explore a wide

range of useful white papers, video webinars, including this

presentation and other thought leadership ideas at

www.sldesignlounge.com.

White paper | November 2011 | Online Packaging | 1

mailto:[email protected]

mailto:[email protected]

http://www.belongingexperiences.com

http://www.belongingexperiences.com

http://www.sldesignlounge.com

http://www.sldesignlounge.com

Is there a future for packaging in an online world?

This very question was the foundation for a research study our

firm conducted in the U.S. in September 2011. With the explosive

growth of online sales, how is this impacting the need for

packaging and does packaging need to evolve to effectively

support branding initiatives that have worked so well at the retail

shelf level? We have seen other channels of distribution emerging

over the years, warranting their own style or type of packaging.

From the big discount warehouse clubs who demand oversized

multipacks to the convenience retail sector looking for products

that can be consumed in the car, marketers have met these

challenges with unique packaging.

With the rapid growth of online sales, do marketers again need to

rethink their packaging strategies for this unique type of

distribution channel? If so, what type of changes are required that

will ensure their brands remain relevant as part of the pre, during

and post purchase cycles. This white paper will present recent

quantitative research findings conducted by our firm. In addition,

we will be sharing insights on consumer online shopping

behaviors and the role packaging needs to play to provide

marketers and brands with a sustainable advantage, namely:

1. Why should we care about online?

2. What are the branding requirements for online shoppers?

3. What role does packaging fill as part of the online selection

process?

4. Guidelines and application approaches for marketers


"Online shoppers

are ‘up to 15

percent

more brand loyal’

and spend

more on the

Internet than

when

shopping at

physical retail

outlets"

Andy Houghton, Unilever

E-Commerce Director

Executive summary - leveraging a new moment-of-truth for

online shoppers

The role of packaging is changing in an online world, and how it

links to conventional retail purchase behaviors is shifting. The

greatest change is occurring at the post-purchase stage of the

online experience, challenging the conventional wisdom of creating

a consistent brand experience.

The study identified that once the purchase is completed, the role

of packaging changes dramatically, and its primary purpose is to

protect the product during shipment. We have identified the

receipt of the shipping package to customers as a new moment of

truth to which marketers need to pay greater attention. On the

most basic dimension, it is ensuring that the shipping carton

properly protects the goods during transportation. However, on a

greater dimension, it is an opportunity for organizations to convert

this functional need to one that provides a unique and ownable

experience that builds affinity for the online service provider or

branded product.

For now, marketers can take great comfort in knowing that

shoppers continue to rely on packaging to make the right selection

prior to and during the online purchase process. The ability to

leverage pre-established relationships with the brand via

conventional retail channels of distribution remains important

factors in the selection process. Packaging graphics are currently

the link of familiarity between the offline and online world.

However, with the continued growth of online sales, having a prior

offline experience with the brand is becoming less relevant.


The growth of online sales?

Much has been written and researched regarding online sales. The

hysteria of the ’90s that predicted the downfall of conventional

retailing has been replaced with fact-based proof that retail is here

to stay and prosper. The reality that came to light in the turn of this

century clearly identified that web commerce and retail sales

would prosper together as they both complemented the needs of

shoppers on their quest for finding the best value and selection.

Today, online sales in the U.S. represent $145 billion, or by

comparison, roughly 60 percent of Walmart’s total U.S. store sales.

Consistent with a continued growth for the category, a more

recent 2011 ComScore study identified that total e-commerce sales

through Q2 2010 were up seven percent versus a year ago with

travel and non-travel up five percent and nine percent, respectively.

Irrespective of online sales’ meteoric growth in the past ten years,

it still only represents four percent of total sales. Based on a 2010

U.S. Census online commerce report, this growth was

predominantly generated from the sales of music, electronics,

computer software, books/magazines and clothing. You could

argue that some of the growth is a natural transition for the

technology and service industries as they move to a digital world.


“American

internet users

have embraced

online

shopping

because they

say it is

convenient and

a timesaver.”

John B. Horrigan, Associate Director, PEW INTERNET & AMERICAN LIFE PROJECT

Base : All respondents n=27,665 AC Nielsen Consumer Confidence Survey – Q1 2010 • Field dates March 8, 2010 – March 28, 2010

OtherCar hire

Sports MemorabiliaAlcoholic drinks

Baby suppliesAutomobiles & Parts

FlowersComputer Software

Toys/DollsSporting Goods

MusicGroceries

Videos/DVDs/GamesComputer Hardware

Event TicketsCosmetics/nutrition supplies

Tours/Hotel ReservationsElectronic equipment

Airline ticket/reservationsClothing/Accessories/Shoes

Books 44%36%

32%27%

26%22%

20%19%

18%18%

16%13%

11%11%

8%7%7%

6%5%

4%7%

CPG growth of online

Not only have the sales of fashion, reading and electronic products

shifted to a significant portion of online sales, CPG companies have

seen a growth of their products. In 2010 sales of consumer

package goods online grew to $12 billion or two percent of total

online sales and are anticipated to reach $16 billion by 2012, a 25

percent increase, outpacing total online sales growth. Based on a

Forrester and Barclays study, they anticipate growth rates of 10 to

14 percent for the key CPG categories of pets, food/beverage and

personal care. This growth has not gone unnoticed as companies

such as P&G have seen their online purchases now accounting for

one percent of their total sales. This has driven the growth of

package good companies in creating online e-retailing platforms to

capture this drive for convenience, choice, and now with electronic

coupons, value.

The rise of digital has also greatly impacted shopping behavior

with nine percent of U.S. households currently buying CPG online

and this number is anticipated to rise to 21 percent by 2020.

Consumers who buy online tend to buy larger basket size ($80

online versus $30 offline) and for CPG companies, it is a platform

to build stronger brand loyalty, establish a direct dialogue with

their loyal customers and more importantly, help shift the balance

of power between retailers and manufacturers. For retailers, this

shift can be concerning as a recent Nielsen study identified that

buyers are reducing offline trips and stocking up online. CPG

manufacturers are provided a strong online presence through sites

such as Alice which allow a convenient and efficient way for

consumers to shop from a wide range of offerings. For most online

websites, the use of packaging is fairly consistent, depicted by the

face panel with supporting copy identifying the product features/

claims and retail selling prices. In most instances, sites we audited

featured the ability to magnify the hero shot, making it easier for

shoppers to recognize specific packaging features and product

claims.


Women are big online shoppers

A recent study by ComScore identified that 12.5 percent of women

Internet users made an online purchase compared to 9.3 percent

of men. What’s more surprising is the fact that women made 61.1

percent of online purchases that accounted for 58.2 percent of

dollars sold.

The purchase categories that men dominate are electronics, event

and movie tickets and the more obvious, flowers. In all other

categories, women dominate the purchases. Women are also more

likely to use social networking online, and seem to be drawn to

community, lifestyle and health websites. Internationally, women

spend more time on the web than men. SheSpeaks.com conducted

a survey of women’s online and computer habits in 2009. The

study identified that when women who enjoy online shopping get

together, 62 percent of their conversation is about products, with a

significant increase amongst those with children ages 13 to 17 (71

percent). The most talked about category of products on social

networks by women is beauty products. After that food/

restaurants and movies/entertainment are also popular, especially

amongst younger women.

Online pre, during and post shopping behavior insights

To gain a better understanding of the role of packaging in an

online world, Shikatani Lacroix conducted a U.S. web-based study

with 1,000 consumers who had purchased an online product in the

past three months. Of the total number of respondents, 66.3

percent were women versus 33.7 percent men, which supports

previous studies on the gender profile of online shoppers. To

ensure we had fair representation of the various age groups, we

set quotas for age group segments, an equal split amongst the 50-

plus, 30 to 49, and the 20 and younger segments. The actual split

within these segments is illustrated by the chart on the left.


17 or younger

18 to 20

21 to 29

30 to 39

40 to 49

50 to 59

60 or older 11%

18%

13%

17%

25%

8%

9%

Which category includes your age? SL 2011 U.S. Packaging in an online world study

Respondent profiles align with industry benchmarks

The study had a fair representation of the various income brackets

with 11.7 percent consisting of annual household income before

taxes of above $100,000, 37.1 percent between $50,000 and

$99,999, 20.8 percent between $30,000 and $49,000 and another

21.2 percent below $30,000. Although the online study

represented a different split between the incomes identified by the

U.S. Census recent report, they do directionally align (20 percent

earned over $100,000, 30 percent earned between $50,000 and

$99,000, 25 percent earned $30,000 to $49,000 and 24 percent

earned less than $24,000). The figure to the right clearly identifies

how the research sample income segments aligns with the U.S.

Census.

More than fifty-six percent of respondents were married with the

second largest segment consisting of singles at thirty-five percent.

The remaining segments were either widowed, divorced or

separated representing nine percent of the sample size. From an

ethnicity standpoint, the majority of respondents were Caucasian

followed by an equal percentage for Asian, African American and

Hispanic consumers.

From an educational standpoint, the majority of respondents had a

post high school education with very few having less than a high

school diploma. It was interesting to note that within our study,

only 25 percent had a full time job with another 30 percent

working less than 40 hours per week. More than 30 percent were

unemployed, either looking or not looking for work. Finally the last

segment consisted of retired respondents who represented 10

percent of the total sample.


Under $29M

$30M>$49M

$50M>$99M

$100+20%

30%

25%

24%

37%

21%

25%

17%

SL Study 2010 U.S. Census

Which of the following ranges best represents your total annual household income before taxes?SL 2011 U.S. Packaging in an online world study

Married56%

Never married35%

Separated1%

Divorced6%

Widowed2%

Which is your marital status?SL 2011 U.S. Packaging in an online world study

Under $29K

$30K-$49K

$50K-$99K

$100+

Majority of respondents are heavy online purchasers and do most of the buying

Close to 70 percent of our total respondent sample fell in a group

that did all or most of the shopping for online purchase. This

segment’s largest age group was people 21 to 29, was better

educated with 27 percent having a bachelor degree, higher income

with the largest total household income group consisting of the

$50,000 to $74,999 range, and predominantly women (71.2

percent do all of the household online shopping). This group not

only did most of the online shopping, but also spent the most as a

percentage of their total monthly spending with the largest group

at 29 percent who spent between 11 percent to 25 percent monthly.

This group tends to outperform the total sample size but overall

ranking by purchase category remains consistent other than

computer software and hardware. It was also important to note

that gift-giving was a very important portion of online shopping

needs with 28 percent of all respondents purchasing more than 25

percent of their total online purchases for this purpose.


Less than 5%

Between 6% and 10%

Between 11% and 25%

Between 26% and 50%

Between 51% and 75%

Greater than 75%1.90%

6.20%

13.70%

25.70%

25.40%

27.10%

2.40%

7.30%

15.20%

29.00%

25.40%

20.70%

Do Most of online shoppingTotal respondents

Alcoholic Drinks

Sports Memorabilia

Pharmaceuticals

Hardware/Tools

Sporting Goods

Banking Services

Groceries

Baby Supplies

Computer Hardware

Toys/Dolls

Computer Software

Music

Videos/DVDs/Games 55.5%

51.0%

39.0%

35.9%

39.0%

25.3%

25.9%

25.3%

24.5%

18.4%

18.0%

16.3%

10.3%

60.2%

54.0%

44.8%

42.2%

31.4%

31.3%

30.4%

29.8%

28.0%

22.7%

21.0%

18.5%

12.6%

How important is it to see the actual packaging (graphics, brand name, format such as box, bag, tube of the package) prior to the purchase as part of the online experience for the following categories? Please only provide answers for the categories you have purchased in the past three months. SL 2011 U.S. Packaging in an online world study

What is your online shopping spending percentage of total monthly spending? SL 2011 U.S. Packaging in an online world study

Do most of online shopping Total respondents

Overall buying experience meets expectations

Overall, the majority of online shoppers were happy with their

experience with more than 90 percent indicating that the current

experience either met or exceeded their expectations.

When asked to indicate which part of the online purchase process

required the most improvement, 41 percent identified the

experience prior to the online purchase, namely the ability to do

research, talk to friends and get information, required improving. In

reviewing the results, most respondents found the research part of

the buying process time consuming, and confusing with the ideal

consisting of sites that allowed them to review a wide range of

products and prices. Another 33 percent cited that the experience

during the online purchase, namely the viewing and selecting of

products, accessing pricing, features, shipping and payment

options had issues that needed to be resolved.

It was interesting that very few people identified the depiction of

packaging as a major issue. When asked to identify areas of

opportunities, the following key points were listed:

• The total cost of the product, including shipping before the

check-out

• Time consuming to gather all the research and find the product

• Hard to navigate websites

• Products were hard to see or information to read

• Shipping delays and tracking

• Return policies after buying

• Ability to price compare


"I usually have a

good idea of

what I want. My

online

experience is

finding the

specific product

which satisfies

my needs. I am

looking for the

right price, and I

spend a lot of

time comparing

prices."

Respondent verbatim, SL 2011

Online Study

Pre-purchase decision is very important in the selection

process

When you review the behavior of heavy online shoppers, they

tend to frequent sites that allow them to select products from

many different online stores (49 percent) as well as sites for

stores that you can only shop at online (27.9 percent). Sites

that sell their products through catalogues or “brick and

mortar” stores were less frequently visited with only 22 percent

selecting these options.

Mention of sites most visitedMention of sites most visitedMention of sites most visited

Sites where products/services are only available through the web

Sites for buying singular brands that can only be purchased online

Online retail sites that are linked to a traditional “brick and mortar”

Amazon (42%) Amazon (11%) Walmart (11%)

eBay (7%) eBay (3%) Target (6%)

Walmart (1%) Walmart (1%) Best Buy (5%)

Overstock (1%) Apple (1%) Amazon (3%)

Qvc (.5%) Best Buy (1%), itunes (.7%), and Target (.7%)

Old Navy, Sears, Gap and Kohls were mentioned less frequently (1%)

Online shoppers rank the importance of the following factors

as very important in making the right purchase decision:

• Reading online ratings (35 percent)

• Have prior experience with the product/service (31 percent)

• Brand name (21 percent)

• Company website (19 percent)

• Read social media customer comments (16 percent)

• Referred by a friend or family (16 percent)

It was interesting to note that advertising through conventional

mediums ranked very low at 10 percent. In addition, what was

concerning was the low reliance on sites that included

conventional offline retailing options, potentially representing


an early indicator of the shift away from traditional store

shelves as the first moment of truth. When respondents were

asked to select the most important factor that allowed them to

make the right buying decision across the various categories,

two were emphasized, namely the prior experience the

respondent had with the product or service, and the ability to

read online ratings and reviews. We believe the future link of

conventional “brick and mortar” in establishing a prior

experience will be challenged with the growth of repeat

purchases of online products or services.

Role of packaging importance prior to purchase

Respondents were asked what role does the packaging graphics or

the packaging structure play as part of their online selection

process. Respondents identified the following: the importance of

the packaging protecting the product during shipping,

reaffirmation that they were getting the product they purchased

online, the ability to understand the usage or instructions as well as

product features or claims that were easy to find. The two most

important factors were that the product they purchased online was

the right product delivered to the home, in the right condition.

What role does the packaging graphics and/or the packaging structure (box, bag, bottle, etc.) play as part of your online selection process? Most important listed in chartSL 2011 U.S. Packaging in an online world study


Ability to see the actual packaging graphics

Product features or claims are easy to find

Recognize the product I saw in the store

Know what I am getting

Ability to understand the usage or instructions

See what it would look like as a gift

Helps me select between various options

Reinforces the brand name

Protects the product during shipping

Allows a 3D view of the product 19.6%

64.9%

20.7%

32.0%

22.8%

45.3%

60.0%

36.1%

40.8%

26.7%

Please identify the most important factor that allows you to make the right choice for each of the online product categories you have purchased (please only provide answers for the categories you have purchased in the past three months).



Category Most important

Second Most Important

Sports Memorabilia

Prior Experience

Read online ratings/reviews

Alcoholic Drinks Prior Experience

Referred by friend/family

Baby Supplies Prior Experience


Computer Software


Prior Experience

Toys/Dolls Read online ratings/reviews

Prior Experience

Sporting Goods Prior Experience


Music Prior Experience


Groceries Prior Experience


Videos/DVDs/Games

Prior Experience


Computer Hardware


Prior Experience

Banking Services Prior Experience


Hardware/Tools Prior Experience


Pharmaceuticals Prior Experience


OthersPrior Experience


SL 2011 U.S. Packaging in an online world study

When asked how important it is to see the actual packaging prior

to the purchase as part of their online experience for the various

categories they had purchased, video games, computer hardware

and software, groceries, pharmaceuticals, toys/dolls and sports

memorabilia scored extremely high. Categories in which the

packaging was seen as slightly less important were baby supplies,

alcoholic drinks, sporting goods, music, banking services, and

hardware/tools.

The role of packaging is viewed differently during CPG post

purchasing

Consumers within the study who had purchased from conventional

consumer packaged goods categories such as baby supplies,

groceries and pharmaceuticals represented more than forty-seven

percent of total respondents within the study. This group’s website

usage mirrors the behavior of the overall group in the ranking of

types of sites. Specifically, they expressed a preference with sites

that allow them to select products from many different online

stores as their preferred choice. This consumer package goods

group of total online spend and most other factors did also mirror

total respondents within the sample.

However, where we noticed a significant change in behavior is

when respondents were asked the role of packaging as part of

their online selection process. Online buyers of baby supplies and

especially groceries and pharmaceuticals ranked the role of

packaging significantly higher in the selection process, with the

largest percentage shift consisting of a 3D view of the product

(25.5 percent versus 19.6 percent for all product categories), ability

to see the actual packaging (33.7 percent versus 26.7), and helps

me select between various options (45.2 percent versus 32

percent).


Sports Memorabilia

Alcoholic drinks

Baby supplies

Computer Software

Toys/Dolls

Sporting Goods

Music

Groceries

Videos/DVDs/Games

Computer Hardware

Banking Services

Hardware/Tools

Pharmaceuticals

39.5%

26.1%

29.0%

37.7%

30.6%

41.5%

31.7%

25.0%

29.2%

35.3%

26.2%

28.8%

32.8%

36.0%

31.9%

30.7%

38.1%

37.0%

44.7%

34.1%

30.9%

35.8%

33.7%

30.4%

25.7%

37.4%

39.9%

34.0%

30.7%

42.1%

37.6%

42.0%

30.9%

31.1%

39.2%

35.8%

33.9%

24.4%

36.5%

30.3%

24.9%

26.7%

34.1%

35.7%

35.4%

28.9%

25.6%

28.9%

31.1%

23.6%

19.0%

32.7%

Very Important - Total Sample Very Important Baby SuppliesVery Important Groceries Pharmaceuticals

For those respondents that purchased baby supplies, groceries and pharmaceuticals versus the total sample, how important is it to see the actual packaging (graphics, brand name, format such as box, bag, tube of the package) prior to the purchase as part of the online experience for the following categories?

Total Sample Baby SuppliesGroceries Pharmaceuticals

The importance of actually seeing the package graphics, brand

name, and format prior to the purchase also increased significantly

with the biggest swing between eight to eleven percentage points

for baby supplies, groceries, hardware tools and pharmaceuticals.

Overall, this group also tended to be more satisfied with their

online shopping experience with more than 30 percent citing that

their current experience exceeded their expectation versus 25

percent of total respondents.

Packaging remains an important element during the

purchase process

Respondents are looking for the quickest and most expedient way

to grasp the information they require with more than fifty percent

selecting the simpler approaches to see the packaging. These are

namely the packaging photo of the main view with the appropriate

price, and ability to view close-up images of product features

depicting all views. You could argue that customers go through a

similar offline and online product selection process, namely

identifying the category, scanning the range of offerings based on

a set of criteria, narrowing the range to a select few options and

then gaining more information through side panel information,

pricing and product claims.

Most websites that we visited and those mentioned by

respondents as most frequented mirrored a similar shopping

structure to offline experiences. Approaches that had more

elaborate features such as a virtual tour of the product where

customers can control the view in addition to the price, and

features or a video of the product being used, had very little

appeal amongst respondents.


One of the key factors we noted is the amount of time spent as

part of the purchase process as more than 53 percent of

respondents spend less than ten minutes on the online purchasing

process. The need to review many products in a short period of

time reinforces the need to have a visual link of the packaging as

part of this selection process. Websites should allow for an easy

search of products by category and use the package image as the

primary navigational vehicle, while featuring supporting

information such as price, coupons, features and testimonials as a

second layer of the purchase decision process.

This principle is supported as respondents rated the use of a photo

of the main view with appropriate price as the most important

factor that allowed them to make the right choice for each of the

online product categories. Respondents were consistent with

scoring significantly higher for photos on alcoholic drinks, music,

groceries and pharmaceuticals. When reviewing a sub-segment of

CPG shoppers, this group reflected a different approach for baby

supplies, computer software, computer hardware and hardware

tools. This group preferred a photo depicting all views with

appropriate price and product features. An underlining reason

could be that these products potentially represented more

complex structural items.

As part of your online selection process, besides absolute price and shipping policy, please indicate which

approach to depicting the product/service allowed you to make the right decision?



Photo of the main view with the appropriate price

Photo depicting all views with the appropriate price and product features

Virtual tour where you can control the view plus price and product features

Video of the product being used

Ability to view close-up images of product features

Photo of the main view with pricing, features and testimonials

Ability to view the product packaging, instructions and potential features 32.9%

38.5%

50.7%

22.1%

27.5%

49.9%

61.2%

A higher degree of security, and the ability to price compare were important improvements

When respondents were asked what improvements they would

expect other than price of shipping options, more than 53 percent

cited more secure ways of paying and the ability to price compare

(44.2 percent). Other improvements that ranked high on the list

were easier navigation within the website, better image quality and

quicker uploads. It was interesting to note that irrespective of the

growth of smart phones and their use for browsing the web, only

17 percent identified this as an area of opportunity. Respondents

who had purchased CPG products tended to also rank the ability

to price compare as a significant area of improvement.

Packaging does not play a critical role in the post purchase

online experience for most categories

Although respondents ranked packaging as an important element

prior and during the online purchase, it was interesting to note that

its importance dropped significantly in the post purchase

experience. We would have assumed that branded packaging

would be a constant link throughout the process. However, overall,

the study identified that in most instances, especially for music and

software where the respondents can download these online,

packaging that arrived in the home did not play a critical role.

When asked how important it was to have the product arrive in the

customer’s home in the same packaging seen in the post purchase,

the CPG categories which ranked higher were pharmaceuticals

(36.2 percent) and groceries (35.8 percent). When reviewing the

150 CGP results on the role of packaging, consumers wanted

reassurance that the product they purchased online was the same

as the item being delivered.


Sports memorabillia

Alcoholic drinks

Baby supplies

Computer software

Toys/Dolls

Sporting goods

Music

Groceries

Videos/DVDs/Games

Computer Hardware

Hardware/Tools

Pharmaceuticals

Other 23.7%

24.4%

27.8%

32.5%

38.6%

35.8%

29.1%

25.6%

32.6%

33.9%

26.6%

21.7%

29.1%

How important is it for you that the product that arrives in your home has the same packaging that you would find if you had purchased the product in a store? Results for Very Important SL 2011 U.S. Packaging in an online world study

Respondents also mentioned that packaging did not play a critical

role since the purchase was already completed and they had a high

level of trust in the reputation of the online company. Receiving the

same package as the one viewed online was less critical while

ensuring the item arrived in a usable condition took greater

importance. We also noted that packaging did not play a strong

role with customers who had a low requirement for branded

packaging or were repeat purchasers of the same product.

The importance of the package did increase if the consumer was

giving the product as a gift. The study identified items purchased

online for gift giving had a higher importance level for packaging

with a significant percentage increase for the following: sports

memorabilia (42 percent versus 29 percent for non-gift-giving

purposes), alcoholic drinks (33 percent versus 22 percent), baby

supplies (40 percent versus 27 percent), toys/dolls (47 percent

versus 33 percent), sporting goods (40 percent versus 26

percent), music (41 percent versus 29 percent), and hardware tools

(36 percent versus 24 percent). Marketers may want to consider

developing unique packaging for categories where the product has

a higher propensity of being sold as a gift.

Respondents did identify packaging as having a significant

influence on the perception of the quality of the product (52

percent), the quality of the manufacturer (40 percent) and the

quality of the organization/retailer (37 percent). However

respondents rated the overall packaging slightly lower on their

perception of the overall online experience (37 percent).


"If I know the

brand I am not

concerned about

packaging as

long as it is not

breakable"

Respondent verbatim, SL 2011 Online

Study

Shipping container is generic with no indication of the retailer or brand

Shipping container features the retailer or brand name

Shipping container has printed graphics that give it a premium look

Shipping container is made of recyclable material

Shipping container can be reused for storage

Shipping container is easy to open 45.1%

37.2%

39.1%

23.6%

30.3%

24.5%

33.6%

18.2%

24.1%

14.6%

16.1%

16.6%

How important is the overall design of the actual shipping container in how you would rate the overall online shopping experience?

Very Important

Important

The shipping container is very important

Respondents were asked to rate their overall online experience

based on a series of shipping carton options. It was interesting to

note respondents were focused on more functional benefits of the

shipping carton versus the solutions that focused on the image of

the package or reinforcement of the brand. Respondents identified

the following as very important to their online experience: ease of

opening the container (34 percent), shipping container is made of

recyclable material (24 percent) and shipping container can be

reused for storage (18 percent). Branding on the shipping

container had very little appeal amongst respondents.

Most Important Important How important is the overall design of the actual shipping container in how you would rate the overall

online shopping experience?



Printed graphics that give premium look

Shipping container is generic with no retailer name or brand

Shipping container features the retailer or brand name

Shipping container can be reused for storage

Shipping container is made of recyclable material

Shipping container is easy to open 45.1%

39.1%

37.2%

30.3%

24.5%

23.6%

33.6%

24.1%

18.2%

16.1%

16.6%

14.6%

Strategic Implications

Usability

1. Feature the total cost as part of the upfront selection process

when an item is being selected, including shipping and

delivery timelines versus offering this information at the end

of the process

2. Create a platform that allows visitors to not only review

products but gain deeper insights through reviews of the

offering and price comparison with other similar brands,

leading to a reduction of the amount of time customers

spend researching

3. Create a better delivery tracking system that is seamless

between the online store and the third party logistics

company (Amazon was cited by many as having an issue in

this area)

4. Make more secure payment systems, such as PayPal, an

option in the purchase process

5. Identify up front if an item is out of stock versus having the

shopper go through an entire buying process only to find out

that the item is not available

6. Ensure the reviews are trustworthy and transparent as this is

a growing concern amongst respondents

7. Feature higher quality images of the packaging with the

ability to enlarge the image and read the support material

and pricing, allowing customers to scan a range of offerings

quickly


8. Consider aligning customers’ typical offline purchase

decision behaviors with the site’s content structure where the

“brick and mortar” experience is their first contact with the

brand

9. Expand product selection and research that can be made

quickly, and increase the ability to view a range of items

easily

Packaging

1. Packaging continues to play a very important role in the

online experience. The importance for customers is heavily

weighted as part of the pre research and purchase stages

of the online experience while for brand marketers, it is

ensuring the brand retains its visibility when the product

arrives in the purchaser’s home.

2. Ensure consistency between the package customers see

offline with the one being presented online, as shoppers

rely on the packaging graphics as a means of making a

product selection in an online environment

3. As online shoppers tend to represent a larger basket size

versus offline purchases, it will be important for brand

marketers to reconsider their offerings to better reflect a

pantry loading strategy versus one driven by a higher

purchase frequency

4. Package images need to have the ability to be enlarged on

websites, and the quality needs to be high-end, as the

image of the package is a critical issue in the research and

online purchasing process


5. The online shopping experience must take into

consideration the customer’s prior experience with the

product, such as the brand shelf presence (first moment of

truth) and in-home experience (second moment of truth),

as they are the most important factors in allowing them to

make the right online purchase decision

6. Brand marketers need to review their post purchase brand

experience as this is a critical moment of truth:

• Shipping package needs to ensure the product is not

damaged during shipping, needs to be made of

recyclable material, and easy to open is an added bonus

• Reduce primary packaging to save costs and consider

packaging that supports the premise that customers do

not rely on graphics following the purchase process

• Explore packaging approaches where there are strong

linkages to the brand in ways that are more meaningful

and distinctive as part of the post online moment of truth

Conclusion

The role of packaging as part of an online world remains important

as this channel of distribution continues to gain a larger

percentage of customers’ total purchases. Marketers will need to

effectively monitor how online shoppers’ needs are modifying their

reliance on branded packaging as part of their pre, during and post

purchase decisions. With consumers’ basket size being

significantly larger than offline purchases, it will be important to

tailor the offering to this unique behavior.


For more information, contact:

Jean-Pierre Lacroix, President

Shikatani Lacroix

387 Richmond Street East

Toronto, Ontario

M5A 1P6

Telephone: 416-367-1999

Email: [email protected]
