VP Customer Acquisition Hubbion
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How Product Packaging Impacts Customer Loyalty

22nd Aug 2015
VP Customer Acquisition Hubbion
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Ever since Pepsi came out with their 'blind taste tests' in the 1980s, it has been established through multiple tests that people in fact prefer the taste of Pepsi to Coke. A few years back, Read Montague from Houston's Bayor College of Medicine performed a very interesting test – he asked volunteers to participate in a blind taste test when being monitored under an MRI. The results were quite astonishing – while a portion of the brain that lights up for “reward systems” showed activity during the blind tests, another portion of the brain that governed cognitive action lit up when the same test was performed with visible brand labels. The results of the study was clear – the mind rules over matter when it comes to preferences.

Why does Coke, despite its inferior taste, win over Pepsi in sales? A research paper published by the University of Central Lancashire claims that customer satisfaction is one of the main drivers for loyalty, and this satisfaction, in turn, is driven by perceived value, perceived quality and customer expectations. It is also a well-established fact that packaging is one of the main components that help with establishing product value. The bottom-line here is that how you package and position your product has a great bearing on how loyal customers are to your product.

This knowledge is extremely critical when deciding on the right product packaging strategies. According to Jeff Hilton, the partner and CMO of a Utah based branding company, seemingly minor things like legible communication of key messages, clean templates and good illustrations can go a long way in priming the consumer into buying your product and improve loyalty. But this is not all. Besides the branding and communications delivered on them, it is also important for these packages to align with the purpose and beliefs of the consumer. For instance, organic food products are often delivered in recyclable food packages while high-end wines are often encased in “expensive” looking boxes that showcase class and value.

Besides the manufacturer's product package, another important factor that contributes to loyalty is delivery packaging. According to a study conducted by logistics solutions company Dotcom Distribution, the cardboard packages that online orders are delivered in also serve as an important factor when it comes to customer loyalty. However, we are talking about the platform loyalty here and not about the product. In essence, if the customer is already loyal to a brand of perfume, they could choose to constantly buy it from one website which serves the product in a specific package as compared to buying it from a competitor. The reason, the study found, was that nearly 90% of consumers tend to reuse the delivery package and is probably an incentivizer to buy from specific platforms.

Customer loyalty is a phenomenon that is derived from a multitude of factors. But it has been proved beyond doubt that the package that your product comes in plays a significant role in making customers more loyal to your brand. And this is a component that business owners need to throw a lot more focus on.

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