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Date added: 2017-02-21 Smaller Packaging Increases Profit
For some time, family sized packaging has conquered the market as a more economical purchase. These days, however, downsizing is a sweeping trend: there’s a growing shift towards smaller sized packaging, with an increase in the number of industries deciding to sell the same product in smaller packaging.
How is Packaging Size Reduced?
Smaller packaging is being used largely in the food, beverage, cosmetic and household chemicals industries. Examples include packaging liquids such as shampoo in smaller sized bottles, or selling food products in smaller packaging to decrease the quantity. Smaller packaging has the overall intention of reducing the amount of product that can be stored and therefore sold to the customer.
Usually the reduction in packaging size is so slight it’s hard to spot visually, meaning consumers often don’t realise there’s been a downsize. In many instances, the changes aren’t advertised.
Maximise Profits by Reducing Size
This size reducing tactic proves a way for some brands to recover their costs - particularly if the industry is seeing an increase in the price of materials and transportation. However, many industries reduce packaging size as a way of increasing profits.
Smaller packages pose an opportunity for brands to maximise their profits. Although packaging sizes are shrinking, the price often remains the same - or in some cases increases. The price of the same product in smaller packaging is higher overall: as the packaging and the product quantity is smaller, customers end up - whether consciously or not - buying more and more of the same product to compensate for this loss. This means increased sales and profits for the brand.
A Healthier Choice
Some brands in the food and beverage industry package the same product in smaller packaging as a way of tackling obesity and health concerns, especially in the confectionary industry as a way of complying with new guidelines to cut sugar levels. Emotions also play a significant role in packaging size. In the case of chocolate, for example, many consumers feel some degree of guilt when eating chocolate products, but smaller packaging may relieve this emotional ‘pain’ by allowing customers to feel that they’re not consuming as big an amount.
The Risk for Brands
Decreasing packaging size can be a risky move for brands. Despite the change in packaging size often being hard to notice visually - particularly if the price remains the same in store - customers may notice a difference in their products not lasting as long as normal. When customers realise the change, there is a risk they will feel deceived by the brand they have been loyal to, and may become unsatisfied with the packaging size and product quantity. Smaller packaging with the intention of maximising profits could potentially backfire if customer trust is damaged, affecting consumer loyalty and the chance of return purchasing.
Given the opportunity for increased profits with smaller packaging for the same product, it’s no surprise that the trend for smaller packaging is growing. Browse our range of small sized packaging and see how your products could benefit from a decreased size.