In This Issue

Survey: 'Remorse' aside, innovative mind-set remains strong About 70% of brand marketers launched new innovations or line extensions and 44% repositioned their brands in 2007.

Resolve that the whole will reflect all perspectives I recently struck up a conversation with a manager at a company that helps some major U.S. marketers produce consumer packaged products.

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INTELLIGENCE ON DESIGN The evolution of natural as a lifestyle choice By Valerie Jacobs, Director of Trend Analysis, LPK

It's all about stewardship, life, and energy, and it's playing out in the beauty and health and wellness categories.

In the 1990s, the word "natural" conjured up images of burlap, Birkenstocks, and granola. Beauty, skin, and hair-care products often were packaged in a relatively uninspiring manner, utilizing earth-tone colors as a primary communication mechanism of what was inside.

What natural means today has changed significantly. Packaging and ingredient representations are luscious, vibrant, and indicative of key ingredients inside like botanicals, fruits, and florals—full of life, energy, and succulence. Emotionally, the meaning of "natural" has changed, too. It's about stewardship and our connection to nature, as much as it is about lifestyle choices. There is a heightened awareness and concern about what is being put onto and into our bodies, and the ramifications for our planet.

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As a society, we are putting more effort toward incorporating natural products and philosophies into our lives. Living a natural lifestyle is appealing to consumers as a way to balance or ground them by rejecting old ways and forging ahead with new thinking. There is a growing environmentally conscious market segment dubbed LOHAS (Lifestyles of Health and Sustainability), a $209 billion U.S. marketplace for goods and services focused on health, the environment, social justice, personal development, and sustainability. Consumers attracted to this market are referred to as "Cultural Creatives." Currently, 35 million people across the nation are considered LOHAS consumers. These people are dedicated to planetary health and are more than just focused on natural/organic products. They have surrendered to the idea, and they have the buying power to prove it. Natural products, in this age of sustainability, are seen as premium or a new luxury. Consumers embrace natural products because they communicate purity, safety, protection, and sophistication.

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Some product manufacturers are conveying this positioning through white or transparent packaging that provides consumers with a view of the product, enhancing brand trust and building a sense of integrity. Institute Milano, from the Phytopure Skin Care line, is encasing products in packaging with varying levels of transparency and utilizing clean typography.

Consumers also think of products like shampoo or lotion that contain natural, edible ingredients as good for their hair and skin. CARGO's PlantLove Botanical Lipstick, for example, is formulated from all-natural botanicals with no mineral oil or petroleum. To further engage consumers in the natural product positioning, Cargo's lipstick tube is made entirely from corn, a renewable resource, and the outer carton is made of seeded flower paper. The carton, when moistened, will actually sprout wild flowers.

Natural is a trend with a stable market opportunity that is here to stay, and one that will have lasting, positive implications for beauty care and health and wellness products, as well as for the consumers who use them.

Read more of Valerie Jacobs' analysis of the new-natural trend.

Survey: 'Remorse' aside, innovative mind-set remains strong

About 70% of brand marketers launched new innovations or line extensions and 44% repositioned their brands in 2007. But marketers also say in a new survey that their main regret of 2007 was failing to invest more effort into understanding what makes their customers tick.

However, Next Level SMG, which produced the survey and analyzed the results, says the responses indicate the current state of priorities rather than a lack of foresight as chief marketing officers and brand managers attempt to get the most out of tighter resources.

Next Level, a brand strategy firm, received nearly 100 responses from senior marketing officials at food, beverage, personal care, hospitality, electronics, and home- and building-products companies, including Kraft, Pepsi-Cola, Colgate-Palmolive, Playtex, Nokia, and Clorox. The survey was conducted in October 2007.

Among the chief findings were that in 2007:

• 70% developed or launched a new innovation or line extension.
• 62% deployed new marketing initiatives.
• 56% launched a new advertising campaign.
• 55% redesigned their packaging.
• 44% repositioned their brand.

"The need for creativity and change was driven by marketplace realities," says Heidi Krauss, Director of Next Level SMG and creator of the survey. "Marketing executives who repositioned their brands or launched new ad campaigns told us that they did so for a number of reasons; to revitalize a brand's image that was becoming outdated or losing relevance with consumers, to differentiate the brand more clearly from others in the company's portfolio, or to support an ongoing strategy to stay competitive."

When asked if they could change one thing about their 2007 marketing strategy, 28% of the respondents say they would have invested more effort to learn what motivates and influences their customers. Another 21% say they wished they had depended less on tried-and-true marketing tactics and found more creative ways to reach their audience. And 17% would have focused more on their core base business rather than innovation.

"What might be called 'marketer's remorse' isn't uncommon toward the end of the year," says Krauss, formerly Senior Marketing Director at The Dannon Co. "Companies are doing a lot of consumer research, but everybody has to prioritize their resources and focus on their must-do research needs versus their nice-to-knows. And when you launch a new product, typically you skew the overall budget toward awareness and trial-building, and it's easy to think 'maybe we shouldn't have let it impact our base business so much.'"

Never fear, Krauss says. Marketers have widespread intentions of continuing their innovative ways in 2008. The survey notes that 64% of respondents plan to develop or launch new innovations or line extensions, 38% want to enhance or redesign their products, 30% anticipate the need for repositioning, and 28% want to redesign their packaging.

STRATEGICALLY SPEAKING Resolve that the whole will reflect all perspectives By Jim George, Editor

I recently struck up a conversation with a manager at a company that helps some major U.S. marketers produce consumer packaged products. Steps for integrating sustainability initiatives are wonderful, this manager said, but they quickly can break down in the "silo" mentality that's still prevalent at so many companies today.

He's far from alone in that thinking, and his comments do pose the issue of removing communications barriers between departments.

For the answers, I think back to several recent discussions with those who have walked in the other guy's shoes, working on both the supplier and marketing sides of the fence. Collaborative efforts break down, they said, because efforts aren't made to understand other relevant perspectives.

As a result, marketers too often don't understand packaging in its critical role as the primary brand salesman. Graphic designers, on the other hand, speak a very different language than marketers. They aren't well-versed in consumer research techniques, yet they lament that marketers inhibit their creativity. And neither structural designers nor the sales or engineering departments have been consulted before marketers tell designers, "This is what I want."

To this I would only add that retailers and consumers today are making pretty clear-cut demands of packaged products: Give us what we want, how we want it. Responding to these wants can require complex packaging systems that come about only when the creative process recognizes that the successful group works together. Let's make breaking down the silos one of the hot tactics in the new year.

I welcome your comments. Please call me at 630/897-7158 or contact me by e-mail. I will share them with you in the near future.

Coming to a city near you: Shelf Impact!'s workshops on trends and package design

You've got limited education budget and time, yet you want the essential information about trends driving packaging that gets results with today's demanding retailers and consumers. If this describes you, Shelf Impact!'s Package Design Workshops are just for you.

Shelf Impact!'s Package Design Workshops series is a roll-up-your-sleeves, fast-paced event in a fun and interactive setting that will give you need-to-know packaging information on retail trends, consumer preferences, and marketing and design strategies. In less than a day, you'll walk away with forward-thinking ideas galore for what works in making the package an effective part of a marketing program.

Facilitated by Shelf Impact! Editor Jim George and Shelf Impact! Publisher Jim Chrzan, the workshop series will kick off April 2 in Jacksonville, FL, and repeat at five other locations around the country through August.

Registration is open now! Seating is limited. The workshop will cover:

• Packaging design trends in stores
• Consumer wants and needs in packaging
• Packaging tactics with branding muscle—the roles of emotion, sensory cues, and sustainability
• Steps for managing the creative process effectively

Each workshop will include plenty of time for interaction, including group discussion of packages from around the world. Attendees are invited to send their packaging for a special critique session.

We hope you'll join us for an educational day in a fun-filled environment.