Product Packaging Influences Buying
The problem is made more complex by several conflicting trends in consumer decision-making. On one hand, some consumers are paying more attention to label information, as they become more concerned about health and nutrition (Coulson, 2000; IGD, 2003c). These consumers are more involved in the product decision and use package information more extensively. On the other hand, modern consumers are often looking for ways to reduce time spent on food shopping and preparation.
This can influence decision processes, too, as time pressure reduces detailed consideration of package elements (IGD, 2002b; Warde, 1999). While these are important issues, and becoming even more critical in the intensifying competitive environment, there is little comprehensive study on how packaging elements influence brand choice under involvement and time pressure. This paper aims at forming a better understanding of the link between packaging and consumer purchase behavior. The main objective is to examine packaging elements that influence purchase decisions.
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From this, we propose a conceptual framework for how packaging relates to purchase decisions in the context of different product involvement levels and under time pressure. Generally, qualitative methods are best suited to developing deeper understanding, so our discussion is based on focus groups interviews which examined these issues in-depth with typical consumers. The focus groups sessions had two broad objectives. They are: to examine the consumer experience with purchasing packaged food products; and to understand consumer views on how packaging plays a role in their purchase decisions.
The focus groups were conducted in Bangkok, Thailand, and thus, the views represent consumers in an important middle-income country market where the agribusiness industry is quite strong, and conditions are very competitive. The packaged food products market in Thailand Thailand provides an excellent context for examining packaging of processed food products. Understanding consumer response to packaging in Asia is critical to food companies competing globally, and Thailand is one of the leading markets for such trends. The packaged food industry in Thailand is highly competitive, and the Thai industry is a major player in the world market.
Thailand is the world’s fifth largest food exporter, with more than half of its exports going to its three major markets in Japan, North America, and Europe (The Nation, 2003). Packaged food products constitute to a large part of exports, and thus, domestic markets in the West are seeing an increasing presence of Thai packaged food. In Thailand, the rapid growth of modern retailing, where packaging plays a critical role in merchandising and communication, is an important driver of the dynamic competitive environment for fast moving consumer goods (FMCG) (The Nation, 2002).
Expansion of modern retailing is common across Asia, even in very low income countries (Speece and Luc, 2002), but is more advanced in Thailand than in most parts of developing Asia. According to AC Nielson, Thailand is the most dynamic retail market in the Asian region except for China (Rungfapaisarn, 2002). Internationalization is a key ingredient. For example, Britain is now the fifth largest investor in Thailand, and major British FMCG companies and retailers have a strong presence (UK Trade and Investment, 2003).
A report by IGD (2003a) indicates that, after China, Thailand is one of just three other key Asian markets for international retailers. As many Asian markets, Thailand has seen an influx of foreign retailers. The whole range of modern retail stores common in the West are also becoming common in Thailand. Hypermarkets now lead growth, with foreign stores playing a major role in this category. Tesco has become the largest single player, but there are also three other major chains, including the European Carrefour and Makro, and Big C, which is domestic (Phuangkanok, 2001; Rungfapaisarn, 2002, 2001).
Supermarkets and convenience stores, the other major outlets for packaged food products, show a similar mix of Western and domestic chains. These trends have fostered quite a lot of product and packaging innovation. In Thailand, ready-to-eat and other convenience food products are among the most rapidly growing categories (The Nation, 2002). Packaging has become a critical marketing issue in the competitive domestic market and as Thai products expand their international presence. Industry experts believe that product innovation and packaging are the keys to enhance competitiveness of Thai packaged food products (The Nation, 2003).
The director of the Bureau of Entrepreneur and Enterprise Development, which works with Thai SMEs, believes that packaging is one of the three critical areas where SMEs need to develop more expertise, along with marketing and high quality raw materials (Asawanipont, 2003). A key to maximizing package impact is understanding consumer response to packaging. Many observers, e. g. AC Nielsen, a leading international consumer research company, believe that consumers worldwide are likely to have roughly a similar response to many FMCG, despite cultural differences (The Nation, 2002).
Understanding issues that concern consumers in one highly competitive market should provide a useful guide for others, even if details of execution might have to differ across countries. Our own work has found many elements of behavior toward FMCG brands to be similar among middle class consumers across a number of Asian markets (Speece, 1998, 2002, 2003). In many respects, their behavior does not seem very different from how Europeans may view brands (Speece, 2000).
For example, while there is a considerable brand loyalty toward FMCG in Asia, many consumers are loyal to a small set of brands, rather than to a single one. Roughly half the consumers have frequently not made specific brand choices before they enter the store, as several brands are all acceptable to them (Speece, 1998, 2003). The package truly is critical for these shoppers, and it must communicate the advantages of the food product inside. Consumers in Thailand are becoming more careful shoppers, paying more attention to information about packaged food products (NFI, 2003; Speece, 2003).
This trend, of course, is worldwide. In the UK, for example, IGD (2003c) found that 61 percent of people surveyed now look for product information on food labels, up from only 13 percent in 2000. Convenience is also a key driver for food choice worldwide, and recent trends suggest that the demand for convenience is likely to continue increasing as young consumers take their habits with them into old age (IGD, 2002a). According to IGD (2002a), more impulsive and impatient consumers have driven the move toward more informal dining and a decline in the traditional fixed meal times.