Promotion of products in retro-designed packaging

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Promotion of products in retro-designed packaging

Retailers follow the trend of retro marketing and offer traditional products in retro-designed packaging to attract customers. The trend for retro marketing and packaging is something that re-occurs at regular intervals over successive time periods. This paper analyses consumer reactions (e.g. noticing, locating) to the promotion of products in retro-designed packaging. The example of Lidl retail chain promotion of products in retro-designed packaging is further described. It is to be introduced as a best practice in the Czech market.

Introduction

Retro marketing is an essential aspect of retail marketing. Retailers base the promotion on the nostalgia, and they expect interest of their customers in the products connected with the past. Retro-designed packaging supports this activity. Retailers repeat the offer of products in retro-designed packaging. The effectiveness of this marketing activity is based on the efficacy of the products’ promotion.
The paper aims to analyse the best practice of promotion of products in retro-designed packaging. Firstly, we interpret the results of research into the promotion of products in retro-designed packaging; specifically, we focus on noticing the products in this type of packaging and its localisation, including gender and age differentiation. Moreover, we analyse the informational sources, again divided by gender and age distributions. A survey was conducted to obtain customer opinion in which respondents were personally interviewed on the basis of a structured questionnaire. Basic descriptive statistics were used for interpretation purposes, and data in contingency tables were tested by Pearson’s Chi-square test. According to the results, products in retro-designed packaging were noticed the most in Lidl retail chain. Therefore, this paper also introduces a brief overview of the Lidl promotion activities. This example was developed mainly on secondary data.

Techniques of promotion in retail

Retailer deals on the B2C market, but uses different promotion techniques from the producer. Use of promotion techniques in retail follows the specifics of retailing, which are the basis of the direction of retail marketing. Retailing is a specific marketing discipline defined as, „a set of business activities that add value to the products and services sold to consumers for their personal or family use“ (Levy and Weitz 2009, p. 6). That is the reason why retailers promote, not only the product itself, but the added value as well. Retailing is focused on „marketing activities designed to provide satisfaction to final consumers and to profitably maintain those customers through a programme of continuous quality improvement” (Hasty and Rardon 1997, p. 11). Therefore, the marketing objectives or promotion objectives are concentrated on customer satisfaction and customers’ shopping experiences. A variety of promotional techniques and tools support the achievement of these goals. Regarding that, integrated marketing communication is an essential attribute of successful retail marketing (Lieskovská and Petrovčíková 2018, p. 11).
The retail marketing mix is based on an extensive variety of decisions. Retailers design the brand image and define pricing, promotion or location strategies. They are interested in philanthropic initiatives and CSR, level of service offered and coherent shopping. They apply tools and techniques of merchandising, visual merchandising, public relations and social media communication. Retailers offer customer loyalty programmes and take care of the physical environment and ambience to improve the customer experience. A lot of attention is focused on the „people” factor and the offer of private-label brands (Chaudhary 2016, p. 13).
Armstrong (Armstrong et al. 2017, p. 369) presents the connection between retail strategies and the application of the retail marketing mix (included product assortment and services, retail price, promotion, distribution/location), which form the basis of value creation for targeted retail customers. Retailers can use various combinations of the five promotion tools: advertising, personal selling, sales promotion, public relations and direct/social media marketing. The importance of online marketing is according to Dietrich (2017, p. 8) based on the „simplicity and clarity” as well as „quick response”. It can help the retailer to be much more interactive. On the other hand, Hasty (Hasty and Reardon 1997, p. 11) adds visual merchandising instead of direct/social media marketing; whereas, Lusch et al. (2011, p. 389) present only four promotion types in retail – advertising, sales promotions, publicity and personal selling.
Advertising tools in retail are mostly ads in newspapers, magazines, radio and TV, leaflets and catalogues. Personal selling supports relationships, monitoring, and the satisfaction of customers’ needs. Sales promotion uses price reductions, in-store demonstrations, displays or loyalty programmes. Public relations activities in retail are new-store openings, special events, newsletters and blogs, store magazines and public service activities. Direct/social media marketing employs websites, digital catalogues, online ads and video, mobile ads and apps, blogs and e-mail (Armstrong et al. 2017, p. 375). However, it is possible to identify many new tools or techniques, such as interactive screens, LED walls, holographic displays, smart posters and interactive floors and so on. Marketing tools or techniques are linked to many retail marketing disciplines – in-store marketing, retail merchandising, visual merchandising and shopper marketing, for example.
In-store marketing is „sales promotion at a retailer’s location, with bundled offers, expert advice, product demonstrations, product samples and special discounts, etc.” (businessdictionary.com 2017). In-store marketing includes POP materials, merchandising, sampling promotion, sensory marketing, and other promotion tools in the location (Hesková et al. 2017, p. 73).
Retail merchandising is defined as a „specific practice that a retailer employs to accomplish the sale of a product to a customer” (Chaudhary 2016, p. 179). Retail merchandising is, not only the arrangement of merchandise on the shelf; it is, also, the process of developing, acquiring, displaying, pricing, promoting and communicating the retailer’s merchandise. The most effective way of promoting is visual merchandising, which is „the presentation of a store and its merchandise in ways that will attract the attention of potential customers” (Levy and Weitz 2009, p. 527). Visual merchandising uses a wide variety of presentation techniques. In the case of products in retro-designed packaging, it is possible to introduce idea-oriented presentation, based on a specific idea or the image of the store. The retailer wants to present the good old times to his customers and evoke feelings of nostalgia, a positive feeling linked to the past (Goulding 2002, p. 544). All products in retro-designed packaging are arranged together on one shelf.
The retailer, offering products in retro-designed packaging, promotes and supports these products’ sales even before shoppers visit their store. It appeals to the shoppers (not necessary consumers) using promotion tools of shopper marketing and, thereby, affects shopper behaviour to generate a purchase decision (Stahlberg and Wille 2012, p. 1). Shopper marketing builds the customer experience in the pre-purchase, purchase and post-purchase phases. Pre-purchase marketing is focused on advertising, public relations or direct/social media marketing; whereas, in the purchase phase the most essential tools are sales promotion or personal selling. The relationship with consumers is developed in the post-purchase phase through loyalty programmes, customer service or direct/social media marketing.

Methodology

This paper aims at analysing consumer behaviour and introducing the best practice of promotion of products in retro-designed packaging.
Firstly, we interpret the results of research into the promotion of products in retro-designed packaging; specifically, we focus on noticing the products in this type of packaging and its localisation, including gender and age differentiation. Moreover, we analyse the informational sources, again divided by gender and age distributions. Lastly, the paper introduces practical activities undertaken by Lidl retail chain to highlight the most frequent customers’ evidence of retro-designed products.
The survey took place from May to July 2017 and, during which, respondents were personally interviewed using a structured questionnaire as a basis for gathering information. Surveyors used CAPI (Computer Assisted Personal Interview) to collect representative data from 9 districts of the Czech Republic, from each of which came 11,1% respondents on average (SD 0,6). The survey resulted in 1012 valid responses with age and gender distribution following the National Statistical Office data.
Results were processed in statistical package R (R Core Team 2017) and basic descriptive statistics were used for interpretation. Data in contingency tables were tested by Pearson’s Chi-square test (χ2 test) with the level of significance of 95% (p-value < 0,05). The second part of this paper introduces a brief overview of the Lidl retailer chain activities to illustrate an example of used techniques connected with retro-designed packaging. The information is based on secondary data and observation of online communication activities. More in-depth research needs to be undertaken to introduce Lidl retail chain communication activities in details.

Questionnaire survey

First, the respondents were asked whether or not they had ever recognised or registered any products in retro-designed packaging. Questioners showed respondents a picture of products in retro-designed packaging – examples of both food and non-food products available in retail chains. Interestingly, 773 respondents out of 1012 (more than 75%) said they were aware of and had registered these products. The following results were collected solely from those respondents who had noticed some form of retro-designed packaging. Due to the content of the questions, percentages are related to this filtered number of respondents (n=773). Graph 1 shows the summary of answers to the question of asking where they had seen a product or products in retro-designed packaging. It was an open question with a possibility to state more than one answer. The main results include (in frequency order) Lidl retail chain, with more than 60% (494; 63,91%) respondents, Kaufland (122; 15,78%) and Penny Market (97; 12,55%). The same number of respondents stated other chains and also, similarly, replied that they could not remember the specific retailer, who was selling these products. Other retail chains were mentioned less than 60 times (8%).

Graph 1: Noticing of the products in retro-designed packaging (n=773, frequencies in %) Source: authors

The Lidl retail chain was mentioned in an extreme difference. It can be based on the connection with so-called „Retro Week” offered by this chain and built linking between this promoted offer and memory of respondents. As this retailer is the only one which supports the retro-designed products by special techniques regularly, this link is more than probable. Therefore, the extreme number of answers is not assessed as a distortion. Graph 2 also focuses on the place, but from the gender perspective. The results show that 60,84% (188) out of 309 men noticed the products in retro-designed packaging in Lidl. Similarly, 65,95% (306) of 464 women also saw these products in the same retail chain. Other results are also very balanced between the genders: 16,83% of men and 15,09% of women saw retro-designed packaging in Kaufland, 11,65% of men and 13,15% of women in Penny Market, 9,39% of men and 6,03% of women in Albert, 4,85% of men and 4,74% of women in Billa, 5,5% of men and 2,59% of women in Tesco, 3,56% of men and 3,66% of women in Globus, 2,59% of men and 2,16% of women in the COOP and 2,59% of men and 1,29% of women in Norma. The differences are not statistically significant (χ2 p-value > 0,05). The only statistically significant differences between men and women occurred in Tesco retail chain, as the place where retro-designed packaging was noticed (χ2 p-value = 0,03666), and also between men and women who do not remember the retailer’s name (χ2 p-value = 0,03224). However, both significant differences might be explained by lower amounts of respondents in particular groups.

Graph 2: Noticing of the products in the retro-designed packaging divided by gender (nmen=309, nwomen=464, frequencies in %)
Source: authors

Table 1 introduced the results from the age perspective. The more meaningful results (above 15%) are visible in darker grey, the lower relative frequencies (under 5%) are highlighted in a lighter grey. The bold font of p-values indicates statistically significant differences. Respondents, from all age categories, noticed products in retro-designed packaging in the Lidl retail chain the most often. As the table shows, the least noticing were in Globus, COOP, and Norma: in all age categories, these were mentioned by the lowest numbers of respondents. Interestingly, almost 75% of the third age group (35-44) stated Lidl, and moreover, with the highest frequency, they were able to connect the products in retro-designed packaging with a specific retail chain. On the other hand, the highest number of respondents, who were not able to recall the name of the retail chain, was from the last age category (respondents older than 65 years), which might be explained by respondents in that age group having a worse memory.
The overall results may also be influenced by shopping behaviour, which was not assessed in the survey as the main focus was on remembering the connection of certain retail chains with particular retro-designed products.

Table 1: Noticing of the products in the retro-designed packaging divided by age categories (n=773, frequencies in %)
Source: authors

The questionnaire survey, also, aimed at the recognition of the information sources, i.e. promotional techniques from the retailer’s point of view. Only 773 respondents, who recognised the retro-designed packaging, were asked to pick more than one answer from a list of offered possibilities.
Graph 3 shows that leaflet advertising (425; 54,98%) was the most frequent answer given followed by: TV advertising (310; 40,10%), in-store promotion (152; 19,66%), online advertising (69; 8,93%), out-of-home advertising (16; 2,07%) and radio advertising (4; 0,52%). Almost 18% (139; 17,98%) had not seen any promotional techniques being offered. Only one respondent, actually admitted that he/she did not remember the source of information about products in retro-designed packaging.

Graph 3: Information sources of products in retro-designed packaging (n=773, frequencies in %)
Source: authors

Graph 4 shows the results divided by gender. All the results are very similar – men and women notice promotional techniques in a similar way. The only major difference between men and women can be seen in the category of leaflets where the difference is statistically significant, having a 95% level of significance (χ2 p-value = 0,005305).

Graph 4: Information sources of the products in the retro-designed packaging divided by gender (nmen=309, nwomen=464, frequencies in %)
Source: authors

The following Table 2 introduces informational sources from an age perspective. The higher numbers (above 25%) are shown in darker grey, the lower numbers (under 5%) in light grey. The bold font indicates a statistically significant result. Three types of answers were not tested by Pearson’s χ2 test, as they contain zero frequencies and, therefore, they do not meet all requirements for testing.
As the table shows, the most frequent answer, by all age categories, was „leaflet advertising”. However, TV advertising was, also, stated by the first four age categories in more than 45% cases. Interestingly, older respondents (older than 55), not only indicated TV advertising less often, but they did not recall any promotional techniques in most cases. As could be expected, online advertising was mostly mentioned by younger respondents; older respondents (from 55 years) stated online advertising in less than 6% cases. This fact can be mainly explained by information about general internet usage as reported by the National Statistical Office (Český statistický úřad 2017). While younger respondents use the internet in 90% cases, only 28% of older respondents use the internet regularly. Although the differences cannot be assessed as statistically significant on the set level of significance (95%), this can be still accepted as an important variance.

Table 2: Information sources of products in retro-designed packaging divided by age categories (nmen=309, nwomen=464, in %)
Source: authors

The Lidl retail chain and „Retro Week” – a brief overview of activities

As it ensues from the results of the research, Lidl was assessed to be a retailer associated with retro-designed products by more than 60% of respondents. For this reason, the following part of this paper focuses on promotional techniques used in this retail chain.
The Lidl retail chain focuses its special offers around different topics every week; one of which being the so-called, „Retro Week” whereby products in retro-designed packaging are offered. This week was introduced, for the first time, in June 2015 (mistoprodeje.cz 2017). Since then, Lidl regularly at approximately six-monthly intervals, has been offering retro-designed products (akcniletaky.com 2017).
To promote the week, Lidl introduces a special leaflet called „Retro Week”, which is available in both, printed and online versions (akcniletaky.com 2017). The printed version is distributed to consumers, and it is, also, available in a stand in the sales area – placed near an exit area in the week before the sales, or close to the entrance during the time of the special offer.
The online version of the leaflet is made available at many different portals, which introduce the whole selection of special offers available by a range of retail chains (e.g. kupi.cz, najdislevu.cz, letakomat.cz, iletaky.cz, kompasslev.cz, akcniletaklidl.cz, aktualniletaky.cz, akcniletaky.com) and, also, on the Lidl website (www.lidl.cz), where a new offer is published every week. In September 2017, an e-shop (www.lidl-shop.cz) was established where selected non-food products could be purchased directly. A leaflet, showing all of their products, is also presented there.
Information about retro-designed products is spread, not only by leaflets but also by using banners or social media, such as Facebook or YouTube. For example, the Lidl Facebook published a post about „Retro Week” from 2nd to 8th October 2017. It had been shared 71times and it had received 816 reactions (likes). Moreover, the status stimulated communications, with 84 comments being made within the 1st week (facebook.com 2019).
Furthermore, a video was published on YouTube on 29th September 2017 and it had 102 628 viewers. The commercial is also available in a TV version. It highlights three chosen products from the many special offers available during the Retro week (youtube.com 2017).
While „Retro Week” runs, an idea-oriented presentation is applied in which the products are arranged on one shelf in the part of the sales area of the shop, where the specially offered products are commonly placed. The place is, usually, at the back part of the shop on the left side. The products are typically placed on demountable racks, but other types of unique visual displays, e.g. shelf boards with a picture of the retro-designed packaging, special Point-of-Purchase tools, shelf wobblers, posters, stickers or labels on the floor, patterns of the retro-designed product’s packaging etc., are not used.
To summarise it, we need to refer to previous sections of this article. The visible tools are assessed, and the results show a substantial impact on the respondents. Lidl regularly applies the whole range of shopper marketing activities; in the pre-purchase phase, TV advertising and online communication (direct/social media marketing) are published and leaflets are distributed; in the purchase phase there are no special displays, but leaflets are available in the shops, and an idea-oriented presentation/placement is used; in the post-purchase phase, people can react in social media, where they often comment on their experiences, send pictures etc. Therefore, the connection of this retail chain and its visible marketing techniques are highlighted.

Conclusions

This paper aimed at analysing consumer behaviour and introducing the best practice of promotion of products in retro-designed packaging.
We interpreted partial results of primary marketing research, which focused on noticing the products in retro-designed packaging and its localisation, including gender and age differentiation. Moreover, we analysed the informational sources, again divided by gender and age distributions. Lastly, the paper introduced practical activities undertaken by Lidl retail chain to highlight the most frequent customers’ evidence of retro-designed products.
The paper shows the importance of retro marketing and the possibilities of usage of promotion tools. The main conclusions relate to consumer behaviour. More than three-quarters of the respondents noticed the retro editions in the shops. Lidl retail chain was mentioned the most often. Although the survey did not concentrate on shopping habits and we were not able to filter the influence of subjective preferences, the difference between Lidl retail chain and other retailers was significant enough to describe it as relevant.
From the gender point of view, the women noticed these products more often than men, but this difference was not statistically significant. Other results, also, did not show significant differences. The only exceptions being the Tesco chain, which was stated mainly by men, and that women less often connected retro-designed packaging with any retailer. Although these results were statistically significant, they could also be a result of the lower number of respondents in those cases. In terms of age distributions, very balanced results were produced. However, statistically significant differences are seen between the Lidl and Kaufland assessments. It is worth considering, however, that the reason for the age differences could also be due to the respondents’ overall shopping habits, which were not assessed by this research as mentioned above.
We also analysed sources of information about retro-designed products. Leaflet and TV advertising were followed by an in-store promotion. Interestingly, many respondents were not able to name any form of promotion. Both men and women noticed all forms similarly; the only statistically significant difference being in the case of leaflet advertising where women saw it more often than men. Age distribution does not show statistically significant differences, except for TV advertising, which, surprisingly, was not noticed so often by older respondents. Differences can be seen, also, in online communication: however, they cannot be assessed as statistically significant using the set level of significance.
The final part of the paper focused on the specific example of marketing communication techniques applied in the Lidl retail chain during their, so-called, „Retro Week” when the retro-designed products are on special offer. The „Retro Week” and connected promotions, can be evaluated as successful, regarding the presented results of the survey. Other retail chains do not offer products in retro-designed packaging in such a strategic way; which may be the reason why the products are not noticed so often in those stores; even though those retailers do offer them in their product range. This fact brings out opportunities for further research into the efficiency of promotion techniques, which will be undertaken in the near future.

Poznámky/Notes

This paper is one of the outcomes of the grant research No. IGS02C1 „Recent and retro brand perception of the chosen products” at the Faculty of Economics, University of South Bohemia in České Budějovice.

Literatúra/List of References

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Kľúčové slová/Key Words

advertising, merchandising, promotion in retail
reklama, merchandising, marketingová komunikace v retailu

JEL klasifikácia/JEL classification

M31, F19

Résumé

Marketingová komunikace produktů v retroobalech

Retaileři následují trend retro marketingu a nabízejí tradiční produkty v retroobalech, aby přilákali zákazníka. Trend retro marketingu a obalů je něčím, co je v pravidelných intervalech opakováno. Tento článek prezentuje výsledky výzkumu zaměřeného na marketingovou komunikaci produktů v retroobalech. Dotazníkové šetření bylo zaměřeno na zjištění názoru zákazníků. Respondenti byli osobně dotázáni na základě strukturovaného dotazníku. Pro interpretaci výsledků byla využita základní deskriptivní statistika, kontingenční tabulka byla testována Pearsonovým Chi-kvadrátovým testem. Podle výsledků výzkumu, produkty v retro obalech byly zaznamenány nejvíce zákazníky u řetězce Lidl. Proto se tento článek mimo jiné zaměřuje na přehled marketingových aktivit tohoto řetězce. Uvedený příklad je založen na analýze sekundárních dat.

Kontakt na autorov/Address

Ing. Iveta Broučková, Ph.D., University of South Bohemia in České Budějovice, Faculty of Economics, Department of Trade and Tourism, Studentská 13, 370 01 České Budějovice,
The Czech Republic, e-mail: [email protected]

Ing. Eva Jaderná, Ph.D., University of South Bohemia in České Budějovice, Faculty of Economics, Department of Trade and Tourism, Studentská 13, 370 01 České Budějovice,
The Czech Republic, e-mail: [email protected]

Ing. et Bc. Alena Srbová, Ph.D., University of South Bohemia in České Budějovice, Faculty of Economics, Department of Trade and Tourism, Studentská 13, 370 01 České Budějovice, The Czech Republic, e-mail: [email protected]

Recenzované/Reviewed

21. február 2019 / 10. marec 2019