Home

















Free Ukers Guide!
Sensient
When Coffee Speaks
Teepack
Tea & Coffee's Business Classifieds!
Free Ukers Guide!
Sensient
When Coffee Speaks
Teepack
Tea & Coffee's Business Classifieds!
Free Ukers Guide!
Sensient
When Coffee Speaks
Teepack
Tea & Coffee's Business Classifieds!
Free Ukers Guide!
Sensient
When Coffee Speaks
Teepack
Tea & Coffee's Business Classifieds!


Theta Ridge Coffee

RTD Packaging:
First Impressions Matter!

By Timothy J. Castle & Sheryl Rothmuller

If there is anyone who does not already believe that the beverage business today is increasingly a business of entertainment in liquid form, as opposed to one of either celluloid or digital content, one need only read the following interviews. While this writer has argued that the on-sale, made-to-order beverage business falls into this definition, this metaphor is especially applicable to the ready-to-drink side of the coffee and tea business. The executives responsible for these products almost sound as if they could be talking about recently produced motion pictures rather than ostensibly sustaining, or at least stimulating, beverages meant for physical consumption.

Any wine taster knows that a great tasting wine provides a great deal of enriching entertainment, each sip tells a story, from the beginning aromas and physical appearance to the lingering and haunting (haunting in a good way, of course) finish. While a ready-to-drink bottled coffee beverage might not be strictly comparable to fine wine, the fact is, ready-to-drinks (RTD’s) are designed to tell a story of a consumer and his or her beverage. Like wine, the relationship between the beverage and the consumer is more interactive than it is with a visual entertainment. That first interaction is a visual one in that the consumer sees the packaging before drinking the beverage. The packaging of most RTD’s today is designed to tell the would-be-consumer something about the drink it contains but also something about the person about to drink it. Increasingly, RTD’s are designed to appeal to thinner slices of the demographic pie. Each product will tell a certain type of consumer what they want to know not only about the drink but also what they want to know about themselves as well. Certain drink packaging will tell 18-24 year old men that they are adventurous, risk-taking and compelling examples of manhood. Other packaging confirms to the women drinking it that they are sophisticated and feminine while at the same time not psychically emasculating the occasional man that might want to take a sip. One marketer notes that they wanted their product, as opposed to the packaging, be the “star.” Perhaps a more accurate spin would be “co-star,” however, in that the most successful RTD’s are the ones that let the consumer play the leading role with the drink playing the adorable sidekick. The play, the movie, the tableau plays out while the consumer drinks the beverage and everything about the can or bottle, the way it looks and feels, should confirm and reinforce the initial impressions; so, too, should the beverage itself.

Some products may seem designed to appeal to a very general market but actually be configured, both in taste and packaging, to shave off a very specific segment of consumers. It is not the job of beverage marketers to tell their competitors who they’re trying to sell their product to. Some RTD products today are designed to communicate with specific groups of consumers while trying not to alienate a more general audience. Other products are very directly pitching themselves at specific groups almost with the intention of making it clear they are NOT appealing to the masses. As marketers learn more and more about specific consumers, and this knowledge is accumulating rapidly, the number of RTD’s on the shelf will multiply, providing opportunities to entrepreneurs willing to stake out limited but specific shares of the market. Not that the manufacturers of established and more broadly appealing products won’t have something to say about this trend.

John Imbesi, president of North American Beverage Company located in Ocean City, New Jersey talked about his Havana Cappuccino product that features a design of an exotic looking woman on a total bottle sleeve. The bottle features a 38mm closure, and is available in mocha, vanilla classic cappuccino and caffeine free.

“I believe that packaging is the most important advertisement the product can have,” he begins. “That’s what attracts people to the product, the packaging. People don’t want to buy something that looks boring. You want to give them a good product in a very attractive package.”

Imbesi explained that his company wanted to make it ‘in vogue’ to be drinking a ready to drink coffee. Part of that is accomplished by using stylish packaging.

Imbesi sang the praises of Dunkin’ Donuts and their iced coffee marketing program. He said Dunkin’ Donuts has “done the greatest job of converting hot coffee users over to the iced coffee users.” “They package the iced coffee with a new name, called Coffee Coolatta. They not only picked up the hot coffee users, they also picked up a younger audience for the iced coffee. The real secret is if you give people a premium product, you have to have a premium product. The product has to taste good.”

So, of course, while the packaging must be eye catching, what’s inside the package should be a quality product. “We make sure we use nothing but the best coffee,” Imbesi said. “And then we brew it to perfection.”

Imbesi notes that they had a choice of a paper label, clear label, painted label or full body label for the Havana product. “Why we chose the full body label with Havana was because it’s coffee; it’s a natural product,” he said. “There are no preservatives added to Havana. We had to protect it from the ultra-violet rays of the sun.” Imbesi also explained that if the bottle is dropped, the plastic label acts as a protective shield and keeps the bottle from shattering everywhere. Another reason they chose the total bottle sleeve is that it is tamper proof and you cannot get into the bottle without ripping the label. “And it does make a nice billboard,” he adds.

In June in the U.S. and Mexico, the firm debuted bilingual packaging for a product called Dulce de Leche. It’s in the “same bottle that we are using with Havana, with a Dulce de Leche label and it’s in Spanish.”

In April 2002, Morningstar Foods Inc. introduced Folgers Jakada, a ready-to-drink coffee beverage that was the first chilled coffee drink made from Mountain Grown Folgers coffee and low-fat milk. It is sold in plastic bottles and available in French Roast, Vanilla and Mocha flavors. Patty Herbeck, director value brands at Morningstar Foods offered up some thoughts on the role that packaging plays in launching and marketing RTD products.

“Packaging design has a significant role in marketing,” Herbeck began. “Particularly within the ready to drink category. Consumers have so many choices, so it is imperative that the packaging appeals to consumers and communicates what the product will deliver so they purchase the product.”

In addition to communicating the essentials like ingredients, nutritionals, UPC and the size of the product, Herbeck says that the Jakada label exudes the ‘invigorating personality’ of the brand with the use of a sunburst, characters and color of the packaging. She said, “The Folgers logo is large on the packaging to reinforce the quality of the product and to help consumers understand that Jakada is a creamy blend of coffee and milk.”

Herbeck explained that there are many steps in determining the design of a new ready to drink package: first the functional benefits that the package needs to deliver are considered; second, any additional convenience or ergonomic features. “We also consider what brand attributes need to be communicated in the structure and label and then work with the design teams to develop the packaging,” she said. “It was important that the package be made of plastic and be a convenient size and shape with a resealable cap to be taken anywhere.” Herbeck noted that the plastic bottle also opens up other channels of distribution such as vending.” And a shrink sleeve was used so that they could “deliver the highest quality 10-color graphics available in the industry.”

Keith Reimer is the vice president and general manager for the North American Coffee Partnership (NACP), a joint venture company formed in 1994 by the Pepsi-Cola Company and Starbucks. Bottled Frappuccino was the first ready-to-drink coffee product launched nationally by the joint venture in 1996. Today, Reimer talks about the packaging of that drink and their latest RTD offering, DoubleShot, an espresso drink “mellowed by a touch of cream.”

“I think it’s a huge part of the whole equation,” Reimer said about packaging for RTD products. “In my opinion, the package absolutely has to set up the right expectations with the consumer for the product.” He goes on to explain that the packaging on a product should be an extension of your brand personality. It should also be functional, whether it is easy to hold or it fits in a cup holder. Plus, the package should communicate the right taste expectations. “Is it a drink that’s going to be a sipping drink?” Reimer gives an example. “Is it a gulping drink? Is it a refreshment drink? And finally, beyond the functionality for the consumer, it needs to be functional for the sales force. It needs to have shelf impact; it needs to stand out. In this world of exploding beverage choices, people need to be able to find your product.”

“In our case we really wanted to make sure it was appropriate for Starbucks,” he continues. “We actually wanted to communicate quality of great coffee. It’s a coffee drink and it’s critical, given we’re putting the Starbucks siren on the package. We also want to make sure that - this just goes back to being consistent with the brand personality - we wanted it to be contemporary. We wanted to be sophisticated.”

Available in such flavors as vanilla, decaf mocha, hazelnut, caramel and mocha lite, Reimer said that they actually initially had some packaging out there for Frappuccino that was full sleeve, but they decided that they wanted the product to be the “hero.” They wanted the coffee to do the talking, so to speak. “We wanted to show as much of the product as possible. We wanted to communicate that it’s creamy, smooth and had that taste appeal. We felt the liquid in the bottle provided that for us. Keeping that in mind, we also felt that we needed to educate consumers that cold coffee could actually taste good since we were somewhat the pioneers of cold coffee. It wasn’t a dark, heavy product. We wanted them to see it was this taste appealing creamy product, because we felt we needed to overcome some of the misconceptions about cold coffee since it was a relatively a new category in the U.S.”

Reimer explained that packaging is by no means a static activity; it should be a very dynamic part of the marketing process. While he has a lot of quantitative and qualitative research that shows that consumers really respond to the Frappuccino product, there’s always room for improvement. “People think our product is authentic. They believe it’s a high quality package. This kind of little milk bottle shape that we have, people are very close with that and they like that.”

“That having been said, we know there are some things that we could improve to either communicate our flavor line-up better; potentially be a little more legible or potentially make sure that the brand architecture is right for consumers. So we continually will look for ways to improve even the packages we have in the market today.”

Developing the right packaging for a product is “a very rigorous process.” Reimer said it begins with defining the concept and then developing the brand positioning. Once those two factors are known, they begin to work with outside consultants and their advertising agency to assist them in creating and evaluating various packaging options.

“All of those things go into a brief that ultimately leads to a direction that is then tested both qualitatively, typically through focus groups where we might zero in specifically on package design and then move to label design, graphics, fonts and so on,” Reimer explained. “And once we go through that qualitative process, we would then also typically do some quantitative research. It’s a pretty exhaustive process. For the most part, we will do this in a parallel path basis. While we’re working to insure that the product inside the package is at its optimum level, we’ll also make sure that we have the right package to be able to deliver against our objectives.”

Starbucks is positioning their new drink DoubleShot as the only RTD coffee that really “gets you going.” Reimer said that the darker color of the can communicates a more intense coffee experience. In addition, the fact that it is in a can, communicates energy, which is an area they are also competing in. “I think that product skews younger than Frappuccino,” Reimer said. “So I think that package is appropriate for that younger demographic. And at the end of the day, we want to be that morning, pick-me-up Starbucks-on-the-go type of product. And we’re also playing a bit into this energy, or gets-you-going space. So I think it’s appropriate that we’re out there looking somewhat like some of those other energy drinks that may be consumed at a different type of day.

In the highly competitive world of RTD beverages, the quality of the product being consumed is critical, but no one will find your product if the packaging is bland. “You don’t see too many plain brown bags under Christmas trees,” Imbesi points out. “If you use the same analogy; how would shelves look where you have to go now and part with your money and buy something which is boring? You want people to feel good about spending their money. You want to give them a good product in a very attractive package.”

Extreme Coffee, Inc., based in Redwood City, Calif. introduced the Shock Latte and Shock Mocha in a 15.5 oz glass bottle with a full shrink sleeve two years ago. Dan Parodi, co-founder and ceo at Extreme Coffee explained that because of the large size, the flavor profile was made lighter and less sweet. “In May of this year, we broadened the line to include two new flavors, Triple Latte and Triple Mocha,” he said, “and repackaged all four flavors in 8 oz slim-line cans as part of a positioning makeover. The original Latte and Mocha were made creamier and sweeter to appeal to people with those taste preferences. The Triple versions are a bit less sweet and more ‘stout’ in taste without being harsh at all.”

Parodi took some time to offer his thoughts on the importance and impact of RTD packaging, which, he believes, is one of the most important aspects of defining a product’s brand identity. “By definition, the package comes in contact with every consumer who purchases your product,” he said. “That package can either crystallize or muddy the brand image you’re trying to create through any other media or communication.”

Parodi opened up about how companies in the RTD coffee business are faced with competing with a powerhouse like Starbucks, which basically dominates the ready to drink industry with a product that has a very established brand identity. “Because that brand has dominance on a store’s shelf, any competing brand must visually proclaim a message that draws attention away from this brand,” Parodi says referring to the Frappuccino product. “Many competing brands that I’ve seen come (and go) over the years, have, in many ways, proclaimed the same message.” He said that directly targeting the same consumer as the leading brand is a “dead-end street.” “The only sustainable way to capture market share from the big brand is to target a specific demographic segment within the broader RTD coffee-drinking consumer group and create a different product and brand message; then build a package which tries to reflect those competitive features.” He doesn’t advise attempting to supplant the leading brand. “A competitor must be content, at least in the near term, with a piece of the pie - but really own that piece.”

He does recommend defining your demographic segment and then sticking to it so that you can “preclude the ‘big brand’ from stealing your customers without risking muddying their own brand.”

Parodi talks about his Shock products and how he feels they have tapped into a RTD segment that has largely been ignored - 18-24 year olds. He explains what went into the process of creating the new packaging for the Shock drink. “We like to think we’ve clearly defined a growing and largely untapped segment of RTD drinkers; namely, 18-24 year olds. To reflect that in our packaging, we first put our product in an energy drink style can. This immediately says who we are, and who we are not speaking to. From there, our name ‘Shock,’ a red Richter-scale graphic and color choices try to reinforce that presumption.” He said that’s about all a consumer can digest before deciding to pick up the drink. Once they pick it up, they reinforce their message through text that “tries to cement our brand personality or attitude.”

“Now, if you’ve done your job, the consumer you’re trying to reach will pick it up based on your packaging; the consumer you’re not trying to reach will pass it over - which is a good thing,” he assured. “My mantra is ‘if you try to be all things to all people, you will be nothing to no-one, so don’t worry about missing out on the customers you’re not targeting.”

He pokes a little fun at competitors while explaining what he hopes the Shock packaging will convey to end-users. “We are a cool alternative to the leading brand that takes the wishes and whims of the younger consumer seriously enough to brazenly wear them on our proverbial sleeve. RTD does not have to come only in cute little bottles which were configured for 35 year old soccer moms. RTD can be fun.”

Parodi also expanded on why they decided to package Shock in a can rather than a bottle. “Frankly, a good quality RTD coffee product has milk fat in it. Milk fat leaves a ‘ring” at the top of the liquid in a can or bottle. While this is a good sign to product formulation specialists, consumers hold a different view.” He said many consumers also tend to believe that milk-based products need to be in bottles, versus cans, so the decision to use the can was not an easy one for Extreme Coffee. “The great news is our product taste turned out so superior, that we will erode that misconception over time. That may take some time and education for can acceptance, but the leading brand is helping in that respect too.”

Parodi said that Extreme Coffee likes to explore packaging containers that are unique in some way. “When considering containers, we explore various graphic or printing techniques for each container type to see how we could make a package more distinctive,” he said.

After a container is chosen, then the company looks at a wide range of graphic directions, which are then narrowed to about five choices. These choices are “floated informally and formally by a broad range of consumers for quantitative and qualitative feedback.”

The data that is retrieved is then used to hone in on a design direction that is then mocked up and then continually refined. These mock ups are also floated informally by their target consumers. “We use this qualitative feedback to augment our branding objectives in the context of our firm belief that good package design cannot be born from a committee or even an ad hoc group of consumer prospects. Research is important, but too much of it can lead to a muddied marketing message. I think most of us have seen obvious examples of this.”

Parodi concludes his comments with some more thoughts about what it takes to remain competitive in this crowded industry. “I believe it’s obvious now that the #2 player in this category will not gain that position by being just like the #1 player,” he said. “That tactic suggests they believe they can actually attain the #1 slot - which is simply naïve. The second place ribbon will be awarded to the brand that goes after the #2 slot, specifically. Accepting that fact, and then proclaiming it on a store’s shelf through bold packaging takes guts.”

Based in the United Kingdom, The Tetley Group makes a wide range of iced teas that are sold in Canada. They are infused with real fruit flavors, such as Natural Lemon and Wildberry. The drinks are available in sizes ranging from 250ml to 2 liters. Recently in the U.K., Tetley has completed a regional launch of a new ice tea RTD product called Tetley T of Life. T of Life is a blend of spring water with Tetley Tea, fruit juices and a mix of herbs (Ginseng and Guarana) with B vitamins. It is available in two flavors, raspberry and cranberry and lemon and lime. “It has distinctive quirky labeling, designed to appeal to the under 30 age group, a key group driving the increased consumption of tea in Britain,” said Nick Kilby, marketing and development director of The Tetley Group, which was purchased by Tata Tea Limited, a member of the Tata Group in March 2000.

Kilby explains why the design of the packaging of a RTD product really matters, “It is very important, as this is very much an impulse category and iced tea is a ‘new’ beverage to most U.K. consumers,” he said. “The adult soft drinks market is very crowded, so it is important that the packaging is distinctive and appealing. It is important to communicate an image for the brand which will appeal to the target market. With T of Life we have created a fun, quirky image which will stand out and create impact.” The packaging features a large letter “T” at the top of the bottle, with cartoon images of a man with a dog for raspberry and cranberry, and a woman with a shark with a lemon in his mouth for the lemon lime flavor.

Kilby cites the target market and imagery as the two key things that must be considered when creating packaging design. He hopes that with their packaging that they will communicate to their end-user that T of Life is “something new, something fun, a refreshing energizing iced tea.”

In an increasingly diverse market, however, it may not be enough to be number one, or number two…because, just as with television, as the drink “channels” multiply, the share of each diminishes. What Parodi’s hinting at is correct: successful products will be defined not by their ranking in terms of comparative sales numbers but by their ability to command the loyalty and following of their specific demographic. Conceivably, defending a “number one” position in such a market could be the worst strategy of all as Parodi and others seek to stake out a claim to a particular market segment. But, of course, that’s what acquisitions and (re)consolidation are for, aren’t they? 7

Timothy J. Castle is the president of Castle Communications, a company specializing in marketing and public relations for the coffee and tea industries. He is also the co-author (with Joan Nielsen) of The Great Coffee Book, recently published by Ten Speed Press, and the author of The Perfect Cup (Perseus Books). He may be reached at: (310) 479-7370 or via E-mail at: qahwah@aol.com.


Tea & Coffee - July/August, 2003
Tecpacking

Flexicon


Tea & Coffee Trade Journal is published monthly by Lockwood Publications, Inc., 3743 Crescent St., 2nd Floor, Long Island City, NY 11101 U.S.A., Tel: (212) 391-2060. Fax: (1)(212) 827-0945. HTML production and Copyright © 2000 - 2013 by Keys Technologies and Tea & Coffee Trade Journal.

Terms and Conditions of Website Use.         Privacy Policy.


HTML Copyright © 2003 by Keys Technologies and Tea & Coffee Trade Journal. All rights reserved.