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Module 10: Point of Purchase Strategies Learning outcomes On successful completion of this module you will be able to: • Differentiate between consumers and shoppers (or buyers) • Define point of purchase and its role in the integrated communication mix • Explain shopper behaviour at point of purchase • Understand the in-store drivers of point of purchase decisions • Understand the role and importance of packaging and labelling as marketing tools Learning resources Blewett, N., Goddard, N, Pettigrew, S., Reynolds, C. & Yeatman, H 2011, Labelling logic – Review of food labelling law and policy (2011), Australia and New Zealand Food Regulation Ministerial Council – Available here. Readings POPAI n.d, Shopper marketing road map: Why should your business implement shopper marketing? Point of Purchase Advertising International, accessible through this link. 1 10.1 Introduction In this module we consider the important role that in-store promotion and experience has on shopping and, most importantly, purchase behaviour. This module is therefore concerned with what influences shopper behaviour. This means considering the difference between the consumer and the shopper as in this topic we are focussing only on shoppers. While the consumer is the end user of the product, the shopper (or buyer), not surprisingly, is the person who actually buys the product from a store or vendor. These may be the same individuals, but in many instances, and in particular when it comes to food purchases, they are not. Examples here should be easy to imagine, such as, mum or dad who does the weekly household shop and is buying protein for the weekly evening meals. Shall the meal be fish, chicken or pork? What size? What cut or preparation style? Inevitably they will not be simply considering their own preferences here but of all those who will consume the product. In this shopper-focussed module we address three discrete, but interrelated topic areas: 1. point of purchase marketing, 2. packaging and 3. labelling. While point of purchase (POP) marketing broadly refers to all aspects of the in-store (and some of the out of store) marketing experience, packaging and labelling have their own distinct part to play in food marketing. Remember that all of these activities are part of the overall integrated marketing communication strategy – emphasis on ‘integrated’. These elements must be consistent with the overall communication strategy. In the case of food where such a large part of the decision is made in-store, there is a good case that the development of IMC collateral should begin by developing these materials with POP first! 1o.2 What is Point of Purchase (POP) marketing? The average supermarket shopper can be exposed to 20,000+ products in a supermarket visit that may last less than 30 minutes. In addition, many purchases in their trip may be largely unplanned. As discussed in the branding module, food products often do not vary greatly functionally, so in-store motivations and activations at point of purchase can have significant impact on shopper’s purchasing behaviour. So what exactly is POP? In short, we can consider POP marketing as all those marketing exposures that are designed to have the shopper buy our product. These exposures generally occur instore, but as a by-product of packaging (seen later) occur out of store also. POP marketing has an important impact on shopper purchase behaviour, in conjunction with the other elements of traditional consumer focussed marketing already looked at in this course. POP marketing is said to be one of the ‘new’ disciplines in the marketing field, although it has been studied commercially for some time. According to Point of Purchase Advertising International (POPAI, 2013) states that in the past, in-store marketing was considered different to, separate from, and not as important as out of store marketing. These perspectives have changed. POP marketing activities are largely forms of promotion that are built around the product standing out from the clutter and catching the shopper's eye, which are used to facilitate impulse purchasing. One well-cited study by Phillips & Bradshaw (1993) suggests that unplanned purchase of grocery items might be as high as 51 per cent depending on the trip type. This implies there is a significant opportunity for marketers at point of purchase to gain sales. Seafood CRC research confirms that while up to 75% of food purchases are planned before a shopper enters the store, many of the items on the 2 shopping list may simply be ‘tinned tomatoes’ or ‘fish’ – with the brand decision still yet to be made in store (Retail Transformation 2010). By definition, POP implies that the marketing message must be encountered on (or very close to) a shopping trip. POP exposures are frequently referred to as customer ‘touch points’ and have been shown in various studies to help contribute to the ‘brand image’ of products. There are various types of POP ‘touch-points’ including: • Price promotions • Multipack buys • Product samples • Taste testing • Window displays • Counter displays • Floor stands/display bins • Banners of any kind • All types of open and closed display cases • Digital & interactive media • Aisle end caps • Packaging • Information pamphlets, recipe card holders etc. Different POP materials and combinations of materials will be more suitable for different products/situations. The figure below indicates which materials would be most likely to influence a consumer when purchasing fish in store. 3 Watch this YouTube clip to see how POP was used in the ‘Love Australian Prawns’ campaign. Watch this YouTube clip to see how POP can be integrated within a bakery to increase sales. Activity 1. On your next shop, consider all the marketing elements that you encounter on your trip. When you return home see if you can note them down. 2. How much unplanned shopping you engage in. Were there any extras in your trolley that you did not intend to buy at the outset? 4 1o.3 Shopper behaviour at point of purchase Over the last 30 years there have been a great number of changes that have impacted shopper behaviour, for example, economic events like the GFC impact on consumer spending and confidence. New social trends like Twitter, Facebook and online purchasing have emerged, while there are new social norms such as women working increased hours and the prevalence of dual income households. However, time is noted as the single biggest factor of change in our shopping behaviour. People work longer hours, have less time for leisure, have more store choice and shop in more stores, consequently spending less time in each store. One European study found that, of the 23 billion shopping occasions across Europe in 2002, 39 per cent were carried out in less than 15 minutes and the average spend was 25 Euros, which is roughly $37AUD (Soars, 2003). Similarly, Sharp’s (2013, p. 288) fourth empirical law of marketing states ‘that people make many short shopping trips and fewer longer shopping trips. The most common shopping trips (about 15 per cent of them) are to buy a single item, even in supermarkets. In fact half of all trips result in five or fewer items being bought.’ This means that retailers should increasingly provide for these quick shopping trips by making it convenient for shoppers to find the few items that they are looking for. Evidence for this can be found in the UK with Marks & Spencer’s decision to rapidly increase its convenience store format in the 2000s (the Simply Food stores), and the introduction of stores like Tesco Express, where quick shops are the aim. Even those increasingly prevalent stock-up shopping trips require seeking out relatively few items from the tens of thousands present in a regular or super store (Sharp, 2013). The realisation across the retail distribution network, by marketers in particular, that significant influence can be exerted by successful in-store (or shopping trip centric) marketing, as well as advances in technology (interactive displays and experiential marketing such as in-store tasting/free samples etc.) mean the competition for the shopper’s dollar and their attention has become increasingly intense and at the same time more time critical. This is mainly due to greater competition for shopper attention with less time to capture it in! As a relatively new sub-discipline in marketing, unlike more well established theories of consumer and buyer behaviour, POP has very limited theoretical knowledge currently. There are, however, some pieces of knowledge that are crucial for marketers to know about how shoppers shop and hence why POP is important. Sharp (2013, p. 286) notes there are a number of empirically validated observations or ‘laws’ about shoppers. A number of these are particularly relevant for understanding why POP matters and also for what type of POP might matter. These include: • A typical household buys only 300 to 400 stock-keeping units from a supermarket in an entire year. This means that shoppers are quite selective and very loyal as they repeat purchase the same items again and again without a great degree of variety seeking – how often do you buy the same brand of jam or honey, or cheese? Chances are it’s fairly often. As most supermarkets can stock between 30,000 and 50,000 items, each trip is like ‘looking for a needle in a haystack’ (Sharp, 2013). This means that store space is generally very cluttered and as a result shoppers have to develop shortcuts (known as heuristics) to help them decide what to buy and where. However, because of their loyalty, shoppers usually know where to find what they are looking for, meaning incidental POP marketing will have to be particularly effective to catch their eye if they are ‘on a mission’, as we often are when we shop. 5 POPAI n.d, Shopper marketing road map: Why should your business implement shopper marketing? Point of Purchase Advertising International, accessible through this link. Readings This document from POPAI gives a brief outline of why POP is important and outlines some of the benefits and challenges of implementing POP. The reading finishes with some illustrative case studies – note in particular the Smiths case study on pages 9 and 10. The points below highlight some further shopper behaviours at point of sale. • Food consumers (particularly fresh produce) buy with their eyes (Danenberg & Remaud 2010). Think of the last time you bought something from the fresh produce section, the deli, or the seafood counter in a supermarket – visual appearance is the predominant sense engaged in choosing what you will buy. • Shoppers read very little in store — instead, they react to colours and symbols. (Note especially with an aging population – many shoppers cannot read small print without glasses – and some even have difficulty with glasses!) Sharp (2013, p. 290) notes: ‘Human beings are very visually oriented. Compared to our primate ‘cousins’, we rely far more on visual information and we make little navigational use of other senses such as smell. When in a store there is an enormous amount to read, but eye-tracking studies show that shoppers are very selective about what they read. Reading slows them down, dragging out the shopping trip. So, instead, shoppers learn to navigate using colours and symbols that allow them to find an item on a cluttered shelf quickly.’ • Shoppers have been trained to buy specials. Again, Sharp (2013, p. 291) notes: ‘Shoppers like to save money, time and mental effort when shopping. Specials, especially when they are clearly flagged, allow shoppers to save all three. They reduce the cognitive effort needed to pick a brand from one’s repertoire by simply taking the one on special. Navigational aids can do the same thing; for example a tag that points out the bestselling item.’ 6 10.4 In-store drivers of point of purchase decisions Despite the prevalence of food shopping in daily life, there have been relatively few studies of these shopping activities (in comparison to other food marketing studies). There are fewer again within food marketing literature. Retailer vs supplier/producer goals An important issue to consider with in-store marketing is the different goals and objectives of the retailer versus the supplier, hence the need for both parties to work together. The supplier wants as much exposure in the best location for their product in store, however the retailers’ goal is to maximise their return in each product category. The retailer owns the floor and shelf space. Ideally, retailer and supplier should work together for a win/win scenario, but this does not often happen in practice, with typically one or the other (in Australia’s case, usually the retailer) having the most power. Therefore, for a food product to be successful, it needs to be available through Coles and/or Woolworths. The reverse is not so often true, i.e. that the retailer has to stock a certain brand to attract customers. While the supplier often has the best understanding of the consumer (e.g. why they buy), the retailer has the best knowledge of how they buy (e.g. what time of day, which aisles people go into, what products are bought together etc). Successful in-store promotion requires both parties work together. Collaboration is key! Retailer decisions While the supplier just considers their own range of products, the retailer has several instore decisions to address. These can be thought about on three levels. Store level decisions include issues such as how many categories of product will be stocked, where will each category be located within store (and how much space), which categories will be located next to each other, and how the store will flow. Category management refers to managing a group of related products/brands together. For example the category could be ‘baked goods’ or tinned vegetables’. Typically in supermarkets, each category is separately managed and is like its own mini business. Decisions made at the category level revolve around how much space is available overall, how many brands/sizes, how much space per brand, where each brand will be positioned – so decisions are made regarding range, space and layout, visibility and price. At the product level, decisions include the mixes of branded versus private label products that will be stocked, and the size variations of these products. Pricing The final driver to be discussed is pricing. Again, this is a major decision made at the retail level and covers issues such as the overall pricing policy of the store (think ‘everyday low prices’), and again, the pricing differences between branded products, premium products and private label products. This area also covers decisions about sales promotion involving price, how often will products be put on sale, how deep the discounting will be, and whether loss leaders will be used. 7 Think about your supermarket or speciality food store shopping experiences given the theory we have just covered. • How well do stores implement these decisions, e.g how often do you have to search for a product that is not where you thought it should be? • What aisles do you regularly skip? • Are there any favourite products that you can no longer find? Activity 10.5 Activity Why packaging is important Watch this (seemingly basic, but well explained) video (available here) about product packaging first. Watch the first 2 and a half minutes for key points – it may then stop and ask you to subscribe – so stop watching here. This second YouTube clip is for interest only – it goes for about 7 minutes and is simply a history of packaging. followed by highlights of issues such as over packaging. It’s available through this link. 8 Packaging is broadly defined as ‘all activities of designing and producing a product’s container’ (Kotler & Keller, 2007 p.173). This can include up to three layers of package type. Primary packaging is the packaging that most consumers will be familiar with in regard to any given brand, as it is the one that is on the shelf. For example, with a packet of Arnott’s Mint Slice Biscuits, it is the familiar plastic wrapping seen below. Secondary packaging accompanies the primary packaging either outside or inside. Some goods may come in a bottle, but then for carriage, be packed in a box, which still bears logo elements of the product. It can also be the inner packaging material that supports the primary packaging. Finally, the shipping packaging is that which contains a retailer’s order, and will be delivered to the outlet within this packaging. For most grocery items, these will be corrugate cardboard boxes or possibly Styrofoam containers for fresh or chilled items. Packaging must protect, identify brand descriptive and persuasive information and 9 facilitate transport. In addition, it should assist at home storage and aid product consumption. When it comes to packaging, a distinction is made between two sets of equally valuable but functionally different components: • Image bearing components: colour of packaging, typography, the graphical shapes used and the images introduced; and • Structural components: shape, size of the containers and the materials used to manufacture them. This is because the packaging has a number of different roles to perform. From a marketing perspective (our interest), it has to be used to catch the eye of the shopper, identify the brand correctly, convey information about the product (see more in labelling) all of which must fit in according to supporting the other marketing elements related to the product such as advertising, pricing and its positioning. Packaging also has to aid product transportation both in-store and to home (or place of consumption i.e. work lunch), assist with at home storage, and most importantly, to protect the product from damage in all situations both pre (for the producer/retailer) and post (shopper/consumer) purchase. According to Kotler & Keller (2007), a number of factors have influenced packaging ability to be used as a marketing tool: Self-service – the ability for shoppers to limit the interaction and handling between them and their purchase – they buy smoked salmon from a fridge case vacuum sealed, rather than the fresh food counter with the help of a staff member. Consumer affluence – as customer affluence increases, so does their desire to have things that appear nicer and are likely to be presented in nicer or more up-market packaging. They are also more likely to pay for convenience that nicer and increased packaging elements bring to a product. Company and brand image – with increased expenditure on and research into branding, the package has emerged as one of the key marketing tools available to companies. This is further emphasised by the fact that distinctive products and product packages reflect well on their respective brand images. An excellent example here is the 10 famous Coke bottle. Though it’s not really used that much anymore, it is still recognised the world over as being uniquely associated with Coke. Innovation opportunity – when new packaging designs and technologies are found and brought onto the market, companies have the opportunity to create a competitive advantage over competitors - Gourmet Garden’s herbs in a tube are a good example here. We have already established that shoppers browsing the aisles of a supermarket come across many products, but choose to buy only a few of them. One of the elements of the shopping visit is therefore exposure to the packaging that those products come in, packages that have been designed to influence the shopper to buy the product. According to Kotler & Rath (1984), shoppers are more likely to choose products that have an attractive appeal than they are to select similar but less visually appealing products. Accordingly, an appealing product packaging is said to be able to evoke an impulse to buy. However, more than just the impulse buy, packaging images may have a more longterm effect. On the shelf and in someone’s possession, packaging will generally carry the brand image of the product in conjunction with the structural components of the package. These are image variables that are not necessarily a part of the product itself and are used to activate associations with a product so that consumers may rely on them when evaluating the product. Further, these image variables can convey information about the product that consumers can enhance, project, or attain by possessing, using or being seen to buy a particular product. That is, the packaging signals to others something about the shopper. This is similar to the effect of other image variables studied in marketing, which have been seen to have an influence over consumer evaluation and behaviour. Variables include price, country of origin, and celebrity endorsements (DeBono et al., 2003). Also, the packaging of a product will frequently stay with it until it has been consumed (and even after as rubbish) hence the exposure to the packing and thus the brand image is continually refreshed. According to Vila and Ampuero (2007), the characteristics of a product can be continually transmitted over seven stages: • Point of sale • Transporting the product home • Home storage • Opening • Serving the product for consumption • Reclosing or putting away • Disposal. While advertising is incidental and often missed or ignored, the packaging elements that a product has allows it to keep transferring information about the product to the shopper and consumer while they use it. It may build further associations and helps to strengthen loyalty to the product and brand in real time, at the home. 11 Nancarrow et al., (1998) states that ‘a pack has many functions - some, if not all, presenting marketers with the opportunity to gain competitive advantage’. They suggest this comes from the answering of the following questions: • What it needs to hold and in what form • The amount • Shelf life required and under what conditions • Point of sale communication requirements • Branding requirements • Conditions for accessing/dispensing contents • Copy/illustrations needed to encourage optimum use. Further, they suggest that there are seven instances where marketers are needed in the package design process: • Of a new product or variant • A dated/tired pack • A product (changing what it competes with and/or its functional or symbolic benefits) • Its target market • Cost reductions in packaging are required • Legal or regulation requirements demand it (this comes under labelling) • New packaging technology becomes available; (Nancarrow et al., 1998). Activity • What do you like or not like in packaging? • What is your favourite package and why? • What do you think could be improved about packaging? To finish off this topic you may like to watch this 8 minute discussion on portion sizing and packaging over time. The video also starts to touch on labelling! The video can be accessed through this link. 12 TRENDS IN FRESH FOOD PACKAGING DR. TOM MADIGAN, SENIOR RESEARCH OFFICER, SARDI Trends in Fresh Food Packaging Dr. Tom Madigan, Senior Research Officer, SARDI Packaging of fresh meats (including seafood) sold in the marketplace has undergone a rapid change in recent years; gone is the neatly folded butcher’s paper and most packaging types such as loose plastic bags and Styrofoam trays are rapidly being replaced by new styles of packaging, designed to benefit both customers and retailers. allow for branding of products that Advantages of Packaging Packaged product provides a wide variety of benefits to both the consumer and the retailer and these benefits have fuelled the rapid increase of packaged products onto supermarket shelves in recent years. differentiate the brand in the market place Vacuum Packaging and provide the producer with the ability to Vacuum packaging has been used in the engage with their consumer and describe the marketplace for some time. Products are provenance of the product. The ability to placed into specialised plastic bags and a provide QR codes or standard web addresses vacuum applied that draws the plastic films to provide further information is a powerful down tight over the products contained within. means of educating and exciting the This style of packaging reduces the amount of consumer. There is also opportunity to allay oxygen surrounding the products. This is often consumer’s fears of preparing fresh meats by beneficial as it can result in reduced growth of From a consumer perspective, packaged providing cooking instructions or recipes aerobic spoilage organisms, reduced oxidation products are often appealing in appearance, ideas. The packaging also allows producers (that can lead to off flavours and odours) and are clean and tidy during transport and the to provide traceability information to be used also prevent dehydration of the product. An stated use-by date allows confidence in the in the event of a recall event if the food is advantage of this type of packaging style is freshness of the food that they have later found to be unsafe. Lastly, some that it is well accepted by consumers in the purchased. packaging can also provide further benefits market place; particularly with frozen foods. From a retailer perspective, the benefits are by extending the useful shelf-life of products. more wide spread. The clean flat surfaces TRENDS IN FRESH FOOD PACKAGING DR. TOM MADIGAN, SENIOR RESEARCH OFFICER, SARDI 14 Skin Packaging Skin packaging is a variant of vacuum packaging and provides similar benefits. In this format, there is usually a rigid backing tray and the soft film is draped across the product allowing for startling clarity of product in comparison to traditional vacuum package. The technique is particularly well suited to soft meat products such as scallops or sardines as the drawdown of the vacuum is not as harsh as the traditional style. A potential drawback of skin films is that the top surface is not suitable for branding. However, this issue can potentially be overcome with the use of cardboard sleeves for the packaged product. Modified Atmosphere Packaging Modified atmosphere packaging is when a product of several days of shelf-life over that achieved by is placed within an enclosed chamber and the vacuum packaging. Oxygen is used in red meat gases within the chamber are replaced with other products to maintain the bright red colour that gases to create an altered atmospheric condition. consumers associate with fresh meat. Conversely, This packaging is highly beneficial for the retailers removal of the oxygen can result in reduced as it can increase the shelf-life considerably and rancidity in high fat products such as salmon. can also maintain quality traits during storage. Nitrogen is used as an inert gas and does not serve Trays are closed with thin plastic films that provide a technological purpose other than to balance the good clarity of product and, although thin, provide other gases. Modified atmosphere packaging a barrier layer to prevent transfer of gases through is now extremely common in the the packaging. marketplace indicating a strong consumer Three main gases are used in modified packaging: carbon dioxide, oxygen and nitrogen. Carbon acceptance of the product style. dioxide is used to slow the growth of spoilage organisms, which can often result in an extension 14 TRENDS IN FRESH FOOD PACKAGING DR. TOM MADIGAN, SENIOR RESEARCH OFFICER, SARDI 15 SKIN PACKING Packaging Equipment Vacuum packaging equipment can be considered to be at the lower cost scale of Emerging Technologies and Trends the food safety status and quality of the product. To address consumer concerns regarding the extensive use of plastics in food packaging equipment. Although, with increasing cost Evaluation of packaging films for commercial and their effect on the environment, they can provide increasing throughput of use is an area of current research. One recent particular consideration is being focused on product. Some vacuum packaging advance in commercially available packaging biodegradable and compostable films to help equipment can also be used to gas flush technologies is the MYLAR® COOK films promote a cleaner and healthier plastic bags to create a modified atmosphere from DuPont Teijin Films™. This film is environment. Wide varieties of these in the headspace that remains. ovenproof and foods can be cooked within materials have now been developed and are packaging films; the specialised seals vent at available in the marketplace. Tray sealing machines can be used to pack the final stages of cooking and allow the product in pre-formed rigid trays under a product to naturally brown. These films are modified atmosphere. A small variety of tray designed to assist busy consumers with low sizes and colours are available that can be mess, quick cooking methods and also be used for either retail or commercial size useful in commercial environments. Foods In recent years, an explosion of packaged packs. Some trays sealers are capable of can be packaged under either a vacuum or foods has emerged into the market place as applying skin films. modified atmosphere creating a versatile and the packaging provides benefits for both exciting new packaging technique. consumers and retailers. A variety of In thermoforming machines the bottom tray is also formed on the machine and products can be either vacuum, skin packed or modified atmosphere packaged. As the trays are formed at the point of production a wide range of styles can be achieved; trays can be either rigid or soft and the tray size can be adjusted to the product specification. These machines allow for extremely high throughput of product no matter which style of packaging is used. Conclusion different styles are available ranging from Active and intelligent packaging are also a basic vacuum packaging through to highly current focus of commercial development in specialised packaging that employs areas such as the inclusion of natural specialised atmospheres and ovenproof compounds in packaging films that could films. reduce growth of pathogens in the product. Also, several companies are currently commercialising specialised stickers that change colour when exposed to certain temperatures that can be used to validate 15 TRENDS IN FRESH FOOD PACKAGING DR. TOM MADIGAN, SENIOR RESEARCH OFFICER, SARDI 16 Student Resources Australian Institute of Packaging: http://www.aipack.com.au/index.cfm?MenuI D=40 . Discussion Questions 1. Consider the advantages and disadvantages of each of the packaging formats outlined here from both the manufacturer and consumer perspective. Which would you recommend for a small scale manufacturer? 2. How would you promote the most recent forms of packaging to consumers? 16 10.6 Why labelling is important This 4 minute video on labelling for food products looks at a national labelling approach for processed food. The video is available here. Labelling is a component of product packaging, one that is vitally important to the food industry. Inevitably, most items purchased at a supermarket must have a label, whether it is the labelling contained on the packet of mint slice biscuit or a sticker on an orange. Labels perform a function over and above that of packaging, although they clearly occupy the same space. The label can be a simple tag to an elaborate graphic display. What distinguishes it from simply packaging is that labelling has a key role in displaying the correct product information to the shopper. This is distinct from merely a tactic to persuade or entice the shopper to pick up the packet or portion up. The label is the place where much regulatory information is stored. According to the Australian government’s Review of Food Labelling Law and Policy (2011, p 12), the priority on food labelling should be in the following order: • Food safety • Preventative health • New technologies • Consumer values issues. Further (2011, p11) they state: ‘The food label is the arena in which many of the most intense disputes over food take place, for the label provides the most public face for controversies over food. It is also one of the most highly valued and competitively sought after communication channels in the market place. As the battle for space on the label has intensified, and the often competing interests of consumers, industry and government come to the fore, food labelling policy has evolved in a sporadic fashion to satisfy a range of interests, including protecting consumers.’ 17 The figure below summarises the key issues around food labelling policy. Blewett, N., Goddard, N, Pettigrew, S., Reynolds, C. & Yeatman, H 2011, Labelling logic – Review of food labelling law and policy (2011), Australia and New Zealand Food Regulation Ministerial Council – Available here. Readings Read the 15 pages of the Executive Summary and recommendations to get an overview of the current issues around food labelling. 18 What are key elements of food labelling? The figure below highlights some of the key things that consumers want to see on labels for seafood. Note that for seafood, the Heart Tick was not seen as necessary as consumers automatically think that seafood is healthy. Do you agree with the items listed in the figure – what are the most important things you look for on a food label? Do you look for different things on different foods? Activity 19 The great labelling debate The push by manufacturers and the Australian Government to promote Australian products has been evident since the (Business Lounge n.d) 1930s. The logo (launched in 1986), is known as the ‘Australian Made, Australian Grown’ (AMAG) logo, as seen within the accompanying image (Australian Made 2014b). The logo is registered with the Federal Government; therefore its usage must comply with strict Codes of Practice. There are five variants to the AMAG logo. ‘Australian Made’ products are those that have been manufactured in Australia, with 50% of the cost attributed to Australian materials or production. ‘Australian Grown’ products are those that all of its ingredients are grown within Australia, or nearly all processing is conducted in the country. ‘Product of Australia’ logos are used on products abide to the same guidelines used in ‘Australian Grown’ products, but it can be applied to locally manufactured products. ‘Australian Seafood’ logos abide to the same guidelines as ‘Product of Australia’ products, but it applies to seafood harvesting. Lastly, ‘Australian’ labelled products are only used on exported products, and must satisfy one criteria aforementioned (Australian Made 2014a). All food products (imported or otherwise) must abide by legislation to display their country of origin. Under the ‘Australia New Zealand Food Standards Code’, the packaging must identify where the food was made, produced or grown; or state where the food was manufactured and packaged and whether it contains local or imported ingredients (ComLaw 2013). Country of origin legislation ensures that the consumer is provided with a background of the product, granting them the knowledge to make a confident purchase. 20 Case Study – Food Labelling and the Seafood Industry Fat free and 100% natural: seven food labelling tricks exposed If you’re confused by food labels, you’re not alone. But don’t hold your breath for an ata-glance food labelling system that tells you how much salt, fat and sugar each product contains. Australia’s proposed “health star rating” labelling scheme was put on hold in February, following pressure from the food industry. And it’s unclear whether the scheme will go ahead. Marketers use a variety of tricks to make foods seem healthier and more appealing than their competitors, particularly when it comes to products aimed at children. One of the most powerful advertising tools a food manufacturer has is the packaging, as it’s what we look at immediately before deciding which food to purchase. Next time you’re shopping for food, look out for these seven common labelling tricks: 1. Colour The colour of food packaging can influence our perceptions of how healthy a food is. A recent study found consumers’ perceptions of two identical chocolate bars were influenced by the colour of the nutrition label; despite the identical calorie information, people perceived the one with the green label to be healthier. 2. Ticks and seals Another tool of savvy food marketers is the use of “ticks” and “seals” that we subconsciously process as indicating that the product has met some form of certification criteria. 21 A recent study found that nutrition seals on unhealthy food products increased perceptions of healthiness among restrained eaters. And a study with parents of toddlers found 20% of parents identified the presence of a quality seal as one of the reasons for their purchase of toddler formula rather than cow’s milk. 3. Weasel words Food packaging often contains words that imply the food contains certain ingredients, or has been prepared in a way, that makes it healthier (or at least better than similar foods). But many of the words – such as “healthy” or “natural” – have no legal or formal meaning. While the Australian New Zealand Food Standards Code regulates the use of specific health and nutrient content claims, it doesn’t regulate or define these loose terms. “Weasel claims” describe modifiers that negate the claims that follow them. This allows manufacturers to avoid allegations of breaching advertising or labelling regulations, while being such a commonly used word that it is overlooked by the consumer. 22 For example, Activia “can” help to reduce digestive discomfort - but did you read the fine print? It “can” help if you eat it twice a day and “… as part of a balanced diet and healthy lifestyle”. Similarly, Berri Super Juice contains antioxidants which “help” fight free radicals (but so does whole fruit, which also contains more fibre). 23 4. Less bad stuff than… Unfinished claims tell us the product is better than something – but not better than what. In food labelling, we really have to hunt for the “what”. Fountain’s Smart Tomato Sauce still contains 114mg of salt per serving, while the brand’s regular tomato sauce contains 186mg (more than several other brands). The Heart Foundation defines low-salt foods as those with less than 120mg per 100g; Fountain’s Smart tomato sauce has 410mg per 100ml. It does, however, have less sugar than many of its competitors. So, if you are trying to reduce your sugar intake it may be a good choice, but if you are trying to reduce your sodium intake, look for one of the low-salt varieties and read the label very carefully (reduced is rarely synonymous with low). Smiths' Thinly Cut potato chips contain 75% less fat than “chips cooked in 100% Palmolein Oil”. But they don’t contain less fat than Original Thins, Kettle, or most other brands on the market. It’s also worth taking a close look at the recommended serving size – in both cases the nutrition information is based on a 27g serving, but Smiths' “single serve” pack is 45g (15.7g fat; one-fifth of an average adult’s recommended daily intake, or RDI). 24 5. Irrelevant claims A common strategy is to list a claim that is, in itself, completely true – but to list it in a way that suggests that this product is unique or unusual (when in reality it is no different to most foods in that category). “All natural” and “no artificial colours and flavours” are appealing features for parents looking for snacks for their children. But most standard cheeses (including many packaged products such as cheese slices) also contain no artificial colours or flavours. This is not to suggest that Bega Stringers are a bad product or that you shouldn’t buy them – just that you may want to think about the cost per serve compared to other cheeses that are equally healthy. Like most lolly snakes, Starburst snakes are “99% fat free”. The old adage of “saltsugar-fat” holds here; products that are low (or absent) in one are typically very high in another. In the case of lollies, it’s sugar. As with the potato chips above, serving size is important. Those of us who can’t resist more than one snake might be surprised to realise that if we ate half the bag, we would have consumed two-thirds of our daily sugar intake (although we can’t blame the pack labelling for that!). 25 Sun-Rice Naturally Low GI White Rice illustrates this use of technically correct claims. Let’s start with “cholesterol free” – this is totally true, but all rice is cholesterol free. The pack also states in very large, bright blue letters that it is “Low GI”. In much smaller letters that almost disappear against the colour of the package is the word “naturally”. This use of different colours to attract, or not attract, attention is a common marketing technique. The product is indeed low GI, at 54 it is just below the cut-off of less than 55. But the “naturally” refers to the fact that what makes it low GI is the use of basmati rice rather than another variety, and other brands’ basmati rice would have a similar GI. 26 6. No added… Berri Super Juice proudly, and truthfully, claims it “contains no added sugar”. You may conclude from this that the sugar content is low, but a closer look at the nutrition information label may surprise you – a 200ml serve of this super juice contains 25.8g of sugar (29% of your recommended daily allowance). While contentious, some have even suggested that there is a link between fruit juice and both obesity and metabolic disease, particularly for children. A better (and cheaper) way of obtaining the fruit polyphenols is to eat fruit. 7. Healthy brand names Healthy sounding words are not only used as “claims” but are often used as brand names. This first struck me when I was looking for a snack at my local gym and noticed the “Healthy Cookies” on display; they had more sugar, more fat and less fibre than all of the others on sale (Healthy Cookies was the brand name). Brand names are often seen as a key descriptor of the nature of the product. Research has found that people rate food as healthy or unhealthy based on pre-existing perceptions of the healthiness of a product category or descriptor, particularly among those who are watching their diet, and may thus select the unhealthier option based on its name or product category. If, for example, you’re watching your weight, you may be attracted to the Go Natural Gluten Free Fruit & Nut Delight bar, assuming that it will be a healthier choice than a 27 candy bar. But you might be surprised to note that it contains 932 kJ (11.0% of your RDI) and a whopping 13.6g of fat (10% of your RDI). A 53g Mars bar contains slightly more calories (1020kJ) but a lot less fat (9.1g), although the Go Natural bar could argue for “healthier” fat given the 40% nut content. So, can we really distinguish between healthy and unhealthy foods by looking at the wrappers? The healthiest wrappers are made by nature, from the simple ones that can be eaten after washing (like apples and carrots) to those that need some disposal (like a banana or a fresh corn cob). If you are buying your food wrapped in plastic or paper, it’s a little more complex. We need to see past the colours, pictures and cleverly-crafted claims and take a careful look at the ingredients and nutrition panel. Source: The Conversation, available from here. 28 Case Study – Food Labelling and the Seafood Industry 29 30 31 32 33 34 35 36 37 10.7 Conclusions In this module, we have considered the perspective of the shopper rather than the consumer in the food marketing process. In particular, we consider the way in-store (or very near to in-store) marketing communications are used by producers and retailers to influence shoppers at the point of purchase. Given that as much as 50 per cent of all purchases may be made on impulse and that the typical shopping trip can see shoppers pass 300 items per minute on their way around the supermarket, gaining some understanding of how this purchasing occurs is important. Given the relative infancy of the area (from an academic perspective at least), food marketers need to take the knowledge from the existing research and apply these tactics or understandings of the shopper to help promote their products while their customers are close to a sale. Displays, taste tests, recipe cards, serving suggestions are all ways in which the food producer and retailer can attempt to capture a sale. You have completed a number of exercises relating to your opinion about the effectiveness of these measures. Reflect on these. What do you think, from your experience, is the most effective? Given their special place in the POP marketing promotion strategy or as a function of their legal requirements, we also looked at packaging and labels. Packaging serves a number of functions, from advertising the product on shelf, and if purchased, through its life in the consumption cycle. Packaging has been said to communicate ‘brand image’ through the correct use of colours and logos, leading the shopper to associate attributes about the product – is it healthy? Is it luxury? Is it pitched at men or women? Packaging also serves a functional purpose, it protects the product so that it can be stored and consumed satisfactorily. Labelling, as a sub-genre of packaging, is a more defined type of demarcation. While we know from Sharp’s (2013) empirical laws of shopping (that shoppers don’t read much in-store as they are more captured by colours and shapes), that when they do read product information, the label comes into play. The label, which may or may not be part of the packaging, is crucial for selling food. The label carries important and often legally prescribed information such as the country of origin, the contents, nutritional information, the use-by date, unit pricing, portion size and health claims. 38 References Blewett, N., Goddard, N, Pettigrew, S., Reynolds, C. & Yeatman, H 2011, Labelling logic – Review of food labelling law and policy (2011), Australia and New Zealand Food Regulation Ministerial Council, available from: < http://www.foodlabellingreview.gov.au/internet/foodlabelling/publishing.nsf/content/48C054 8D80E715BCCA257825001E5DC0/$File/Labelling%20Logic_2011.pdf> Danenberg, N., & Remaud, H. 2010, Omnibus consumer research findings, Australian Seafood Cooperative Research Centre and the UniSA Ehrenberg-Bass Institute for Marketing Science. DeBono, KG., Leavitt, A. & Backus, J. 2003, ‘Product packaging and product evaluation: An individual difference approach’, Journal of Applied Social Psychology, vol.33, no.3, pp. 513 – 521. Kotler, P. & Keller, KL. 2007, A framework for marketing management, 3rd edn, Pearson Prentice Hall, Upper Saddle River, N.J. Nancarrow, C.,Wright, LT. & Brace, I. 1998, ‘Gaining competitive advantage from packaging and labelling in marketing communications’, British Food Journal, vol. 100, no. 2, pp.110 – 118. Phillips, H. & Bradshaw. R. 1993, ‘How customers actually shop: Customer interaction with the point of sale’, Journal of the Market Research Society, vol.35, no.1, pp. 51 – 62. POPAI n.d, Shopper marketing road map: Why should your business implement shopper marketing? Point of Purchase Advertising International, < http://www.popai.com.au/uploaded/documents/Why-Implement-Shopper-Marketing.pdf> Sharp, B. 2013, Marketing: theory, evidence, practice, Oxford University Press, South Melbourne. Vila, N. & Ampuero, O. 2007, ‘The role of packaging in positioning an orange juice’, Journal of Food Products Marketing, vol. 13, no. 3 pp. 21 – 48. Labelling Vignette References Australian Made 2014a, About the logo, viewed 04 April 2014, <http://www.australianmade.com.au/why-buy-australian-made/about-the-logo/> Australian Made 2014b, History of Australian made, viewed 04 April 2014, <http://www.australianmade.com.au/why-buy-australian-made/history-of-australianmade/> Business Lounge n.d, Australian logos, viewed 04 April 2014, <http://businesslounge.net.au/wpcontent/uploads/2013/01/AMAG-Mixed-SwingTags_AllFive.jpg> ComLaw 2013, Australia New Zealand Food Standards Code - Standard 1.2.11 - Country of Origin Labelling (Australia only), viewed 04 April 2014, <http://www.comlaw.gov.au/Details/F2013L00051> 39