With 2021 already off to an abnormal start, our focus today is on a question that’s stayed consistent with our customer: “What should I spend on my brand packaging?” This edition of THE UNPACK shines a spotlight on what ByQuest offers: Unique packaging and brand storytelling at any budget level and retail price point. When we have early discussions around a brand’s packaging, ByQuest can find the right solution within your budget to help the brand stand out. The earlier we start work with you and your team, the more robust options we can present at different price points to help you answer these questions, “How much should I spend on packaging?” and “How do I know what packaging is right for my brand?”
As a rule of thumb for how much to allocate on packaging cost, ByQuest provides general guidance to dedicate 10% of your retail price to the packaging budget. Your package is the first impression you make with the consumer and deserves this investment to make sure the product has a lasting impact. Naturally, a higher retail price means you have more budget to work with but conversely, the higher the retail price, the smaller the number of potential buyers. A lower retail price makes your product more affordable and means you can appeal to a wider audience, but you also won’t have as much margin to spend on adorning your package. Working with our team early in the design process allows you to explore different branding options that align with the retail value on the shelf.
We call this Brand Power Flex Pricing, and below is an inspirational whiskey brand, Silver Spur, that is presented at three different price points to show what this looks like in practice. From left to right our team has created “Full”, “Nice”, and “Simple” options to show how we can capture a brand’s image at different value targets.
The “Full” option has all the bells and whistles and comes in at just over $5.00 per bottle at a retail price just north of $50. This includes a heavy bottom glass bottle, natural rope necker and metal tin label in a leather finish for an eye-catching effect. In the middle, the “Nice” option makes sense for a retail price point between $30 and $50, with a budget target of between $3.00 to $5.00. This still delivers a very similar feel without spending the “Full” budget option. The “Simple” option comes in under $3.00 for packaging costs yet still presents the Silver Spur brand in a unique and compelling way.
Below is another example for an inspirational Sake brand, Katakana, which falls into our wine pricing:
For this brand, the “Full” option is just over $3.00 per bottle with a crackle décor spray, screen printing plus paper label (mixed media), and an acrylic Japanese art “signature” block with a hand-applied tamper-proof ribbon at the top. There’s a lot going on here to create a super-premium brand image for a product that will retail for over $30.00 per 750ml bottle. The “Nice” option falls between $2.00 and $3.00 where the degree of premium elements are reduced. Finally, the “Simple” option comes in under $2.00 per bottle for packaging expenses. Regardless of budget guidance, the Katakana brand’s look remains strong and bold.
Now back to the main question: “How do I know what’s right for my brand?”
This is where working with the ByQuest team pays off tremendously using the Brand Power Flex Pricing guidance. We very often start with the question, “What’s your retail price?” and working with you, our team is able to put your brand in a position to succeed by designing appropriately to your needs and the value of the brand. You can reach out to us for a virtual presentation with one of our Brand Realization Consultants on what Flex Pricing would look like for your brand.
The power of a brand can be expressed at a number of price points, but it’s important the packaging be designed to the value of the brand being created. Having someone there to guide you will make this process as smooth as possible and increase the chance of you building a strong brand that resonates with consumers.
We hope this was helpful. Let us know what you think. Share your thoughts with us and as always, keep unpacking.
Product packaging is an essential element of any business that sells physical goods. It protects products during transport, provides important information to consumers, and helps products stand out on store shelves. The true cost of product packaging is often much more than just the price of the materials used to create it. Packaging costs can add up quickly and significantly impact a company’s bottom line.
Brands must better understand how packaging costs can impact their business and how they can reduce their costs without sacrificing quality. This infographic provides an overview of the cost of product packaging, the factors that affect packaging costs, and tips for reducing packaging costs while still making the most of your packaging.
Packaging costs can vary widely based on factors such as the size and weight of the product, the type of packaging materials used, and the production process. Businesses need to understand the average cost of packaging to make informed decisions about their packaging solutions.
On average, packaging costs can account for at least 10% of a product’s retail price. However, the actual cost can vary widely depending on the product and its packaging requirements. The cost of packaging materials is also a major component of overall packaging costs.
Here are some examples of the average unit cost of common packaging types:
It’s important to note that these are general estimates, and the actual cost of packaging can vary widely depending on the specific requirements of each product. For example, custom packaging designs, high-quality materials, or specialized packaging solutions may come at a higher cost.
In addition to the direct cost of packaging materials, there are indirect costs to consider, such as storage, transportation, and environmental impact. By understanding the average cost of packaging and its associated costs, businesses can better choose packaging solutions that meet their budget and sustainability goals.
Many different factors can impact the cost of packaging. Some of the most common factors include:
Different materials have different costs associated with them, with plastic typically being less expensive than paper. Glass is also a common packaging material but can be more expensive due to its weight and fragility. Additionally, sustainable packaging materials, such as biodegradable or compostable materials, may be more expensive than traditional materials.
The quantity of packaging required is another significant factor in determining the cost of packaging. Typically, the more packaging that is needed, the higher the cost will be. However, many manufacturers offer bulk pricing discounts for larger orders, which can help to reduce the cost per unit.
Custom-designed packaging will generally be more expensive than pre-made, off-the-shelf packaging. This is because custom packaging requires additional design work and production time. Factors that can impact the cost of customization include the complexity of the design and the level of detail required.
Printing on the packaging, such as branding or product information, can add to the cost of the packaging. Factors that can impact the cost of printing include the number of colors used in the design, the size of the packaging, and the type of printing technology used.
The cost of shipping the packaging materials and the finished products can significantly affect the overall packaging costs. Factors that can impact shipping costs include the weight and size of the packaging, the distance between the manufacturer and the customer, and the shipping method used.
Some products may require specific types of packaging to comply with safety or environmental regulations, which can increase the cost of the packaging. For instance, products that are considered hazardous may require special packaging materials to prevent leaks or spills during transport.
Sustainability is becoming an increasingly important factor in packaging costs. Sustainable packaging materials such as biodegradable or compostable materials, may be more expensive than traditional materials. However, sustainable packaging can also provide cost savings in other areas, such as reduced shipping costs due to lower weight.
By understanding these factors, businesses can start to identify areas where they may be able to reduce their packaging costs. They may be able to reduce the cost of printing by using simpler designs, or they may be able to reduce shipping costs by sourcing materials from a closer location.
Reducing packaging costs is an important goal for any business looking to improve profitability, reduce waste, and enhance sustainability. Here are some effective strategies for lowering packaging costs without sacrificing quality or effectiveness:
One of the most effective ways to reduce packaging costs is to reduce the size and weight of your packaging. This can be achieved by using thinner or lighter materials or redesigning your packaging to be more compact and efficient. By reducing the size and weight of your packaging, you can save on material, shipping, and storage costs.
Many businesses use eco-friendly and sustainable materials, such as recycled paper, biodegradable plastics, or plant-based materials to reduce packaging costs. These options are often more cost-effective than traditional materials, especially in the long run.
Efficient shipping and handling can significantly reduce your packaging costs. Consider using standardized packaging sizes, automating your packing and shipping processes, and working with logistics partners to optimize your shipping routes and schedules. By streamlining your shipping and handling processes, you can reduce labor, shipping, and material costs.
Custom packaging design and printing can be expensive, especially for small businesses. Consider using pre-designed templates or simplifying your packaging design to reduce costs. You can also negotiate with printing vendors or consider in-house printing options to reduce costs further.
Working closely with suppliers can allow businesses to negotiate better pricing, access bulk purchasing discounts, improve packaging quality, and streamline their supply chain for more cost-effective packaging solutions. Consider partnering with a packaging supplier that specializes in your industry or product type and has a proven track record of providing quality services.
Businesses can significantly reduce their packaging costs while providing quality packaging that protects their products and enhances their brand image. It’s important to remember that lowering packaging costs should not come at the expense of quality or effectiveness. By finding the right balance between price and quality, businesses can achieve the optimal packaging solution that meets their needs and helps them achieve their goals.
While reducing packaging costs is essential, it’s also crucial to maximize the value of product packaging to achieve the best possible return on investment. Here are some effective ways to maximize the value of product packaging:
Product packaging is an integral part of the customer experience. Packaging that enhances the customer experience can improve customer loyalty, increase brand recognition, and drive sales. Consider using custom packaging designs, personalized messages or branding, or unique materials that reflect your brand values and identity.
Product packaging is an excellent opportunity to highlight the features and benefits of your product. Add product information or instructions, use high-quality product images, or use color and design to emphasize key selling points. By using product packaging to showcase the product’s unique features and benefits, businesses can increase customer interest and drive sales.
Product packaging should also prioritize product safety and protection. With high-quality materials and packaging design that effectively protects the product from damage or contamination, businesses can reduce product loss, improve customer satisfaction, and enhance brand reputation. Utilize tamper-evident seals, protective padding or inserts, or air-tight packaging for food or perishable products.
Sustainability is becoming increasingly important to customers, and businesses can use packaging to demonstrate their commitment to sustainability. Using eco-friendly materials, reducing packaging waste, and using recyclable or biodegradable packaging can attract environmentally-conscious customers and improve brand image.
To maximize the value of product packaging, businesses should measure and analyze packaging performance regularly. Tracking key performance indicators such as customer feedback, sales data, and packaging costs can help identify areas for improvement and optimize packaging strategies over time.
Product packaging costs extend beyond the direct expenses of packaging materials and production. Businesses must also consider the indirect costs, such as storage, transportation, and environmental impact. Implementing effective packaging strategies prioritizing cost savings and value maximization can help your brand achieve optimal packaging solutions that benefit your bottom line, customers, and the environment.
It’s time to optimize your product packaging and achieve cost savings while enhancing your customers’ experience. Talk to Meyers experts to learn how we can help you design, produce, and manage custom packaging solutions that meet your business’s unique needs.