The success of the discounters Aldi and Lidl in Europe is pretty well known. In the UK these stores are now challenging Morrisons for the number 4 spot in the grocery retail market and in the last year have shown the greatest growth of any of the major food retailers (source: Nielsen). One of the most distinctive aspects of the chains is the way they play with branding, featuring a mix of branded and own-label products, many of which bear a striking similarity to branded versions of the same products not sold in their stores. Previously I have reported the effects that these product similarities have on unconscious shopper decision making, and earlier this year I presented this research at the Marketing Week Insight Show 2017 where it won Paper of the Year.
Interestingly, whilst Aldi currently accounts for around 2% of grocery sales in the US – and so the effects of ‘copy-catting’ might not seem much of a concern across the pond – a couple of weeks ago, on the eve of Lidl announcing its first store openings in North Carolina, Aldi countered with a ramped up expansion plan that aims to achieve 2500 stores in the US by 2022; 4 times the number of Whole Foods! (source: Forbes) As such, it is becoming a pressing issue not only for Europe, but wider afield too.
As a vision scientist who frequently consults with brands and design agencies, our research raised some important implications that suggest direct calls to action for brands wanting to protect themselves against the parasitic nature of these copycat products. A couple of weeks ago at the Shopper Brain Conference in Chicago I presented a self defence strategy for brands to adopt in light of this research if they want to stop losing sales to these copycat products through accidental purchases. In fact, these recommendations are sound lessons for any FMCG or grocery brand that wants to perform better at the point of sale, and so for those of you who couldn’t make it to Chicago, here is that 5-step defence plan.
So you’re probably expecting me to talk here about demographics or personas, both of which are important, but here I am referring to knowing how your customers actually behave in the real world.
Over the past 6 years of Acuity Intelligence, we’ve seen two contributing factors making this defence strategy important. Firstly, store behaviours are changing, with shoppers becoming more time pressured, increasingly top-up focussed and ever more distracted by mobile devices. Add to this the already existing distractions from other shoppers and accompanying family members and the recipe is complete for cognitive overload, which increases the likelihood of automated behaviours that have a direct impact on attention allocation at the fixture. In our research we mimicked how packs appear to peripheral vision as well as when shoppers are looking directly at them (i.e. the level of attention allocation at the fixture) and the results were clear – the less directed attention is towards packs, the greater the likelihood that a lookalike own label product is mistaken for the brand.
Secondly, we are, of course, seeing population changes in developed countries with people living longer. This shift has been accompanied by a whole range of visual disorders like cataracts, glaucoma, macular degeneration, as well as simply worsening visual acuity. What this means is that for these shoppers, as well as the poorer members of society who cannot afford to get their vision checked and corrected as frequently as they should, there is an increased chance of making erroneous decisions at point of sale. And this is where it does come back to demographics and personas, but not for the reason you might have thought. If your product skews towards older, or less wealthy shoppers, then this makes them more at risk from copy cats and package similarity from other brands. For instance, distinctive aspects of your brand are less likely to be detected by your customers, which increases the likelihood of incorrect product selection at point of sale and conversion to own-label.
I’ve been involved in my fair share of pack tests in the past few years and I am still surprised by how limited contextual testing against competitors is in many of these tests. I have already discussed why context matters when evaluating product packaging, but when talking about copycats it’s hugely important to test against the own labels of all the leading retailers. But of course it doesn’t stop there. If you are a category leader, like Coke for example, then other branded products will also try to leverage association by referencing elements of your pack designs – yellow cola drinks anyone? So, it is important to test against all these pretenders to your throne and to do it often. The shelf is a highly dynamic environment, and just because you tested your product pre-launch doesn’t mean those results will continue to hold true 6 months later. If evolution has taught us anything it’s that competitive environments impose an “adapt or die” strategy on those who inhabit them and this means constantly monitoring the landscape your products are competing in.
One of the strongest results from our research was the increase in time it takes for consumers to find target brands when we removed colour from the packs. This is not entirely surprising because we know that in visual search, colour is a key factor that can influence standout and can be used to deselect irrelevant items from the search array. But when the colour was removed the probability of a copycat being mistaken for the brand also increased, and this because it is easier to detect even subtle colour differences than perform a feature comparison for text, logo or other design components.
So colour is a key aspect of your brand’s visual equity and it should be respected as such. This requires you to ensure that colours remain consistent across your packaging and any other point of sale materials such as shelf ready packaging or shelf wobblers. Your brand will have a colour, or colours, associated with it and this association is implicit for your customers so don’t mess with it. Now, you might think that’s obvious, but in the desire to innovate, many brands have attempted to introduce seasonal or limited edition packaging, or have so occluded their colour blocks with promotional messaging and tie-ins that the colour becomes hard to recognise. In my talk I mentioned an example where even Coca-Cola got this wrong and they have just about the strongest visual equity on the planet! The message is simple, your shoppers are looking for something they recognise; if you make that difficult for them they might just go for the next best thing!
If colour was the key to speed of detection in our study, clarity was the key to accuracy. Blurring the pack images increased the likelihood of erroneous selection of the copycats and decreased the likelihood of correct selection of the brands. In our study we used packs from a variety of categories and the pack size played a major role for successful recognition. This is because the bigger the pack, the bigger the design elements on the pack and the less susceptible they are to blurring. This blurring of course replicates how the visual system processes images in its periphery, and so bigger packs are more detectable even when attention isn’t directly centred on the packs.
The take home lesson from this in relation to copy-cats is that pack size matters. But what if your product is small, what then? You can’t make the logo bigger than the pack, but my defense strategy is to remove other clutter from the design that will reduce the available real estate. This is especially important for eCommerce where the rise of the mobile device with its relatively small screen, means that even the biggest pack of detergent is no bigger than box of stock cubes when presented in an app or on a website. For this reason we are seeing a move away from traditional full size pack shots online and an increase in the use of so-called mobile hero images which convey the important information in the simplest, most recognisable way. It is vitally important to make sure your brand is compatible with these new mechanisms.
If you’ve ever read anything on this blog you will know that a common theme is that good research design is one of the strongest, and cheapest, ways to protect your bottom-line. I’ve recently been talking a lot about context and why it’s important, but it needs to be introduced as early as possible to the design development and optimisation process. Focus groups will never be able to report how shoppers will actually behave when they see a package in context, so it’s really important to test these scenarios before the design is finalised and it’s too late to make a change.
Technologies like eye-tracking and, now, eye-tracking in virtual reality, present relatively quick and easy ways to evaluate the performance of packs in a truly immersive context. Therefore, for less than the cost of a meeting with your design agency, you can have some actual behavioural data to evaluate the likelihood that your brand will survive.
The last point I want to mention with regard to testing is that all too often findability studies make it too easy for a participant to find the product, resulting in significant confirmation bias. Common examples are that the scenarios tested in most retail labs do not introduce enough time pressure or distraction to invoke the automated system 1 decision making that we know is used in the real-world. If you make it too easy then a shopper is going find any of your candidate designs easily, but if you make the task a little harder, by using tricks like blurring and colour suppression, then the differences between candidate designs become abundantly clear. Design your research to employ effects like these and you will get significantly more value out of your research spend. If you are uncertain how to go about this then drop us a line and we can talk more about the pack-testing methodology we have developed out of this research.
If you want to know more about the research explaining the errors unconscious shoppers make as a result of copycat packaging, I have now written it up in a detailed white paper. If you would like to obtain a copy or discuss the findings further please get in touch on Twitter, LinkedIn or use the contact form on the website.
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