Thread

Actually, if they promise 50g, and give you a big bottle that has 50g of content, it shouldn't matter, no?

If the manufacturers are smart, not many are, they'd set expectations right in the beginning itself. https://twitter.com/Vaidyvoice/status/1331190515534950401

I will share a small business story for you to consider the comedy of errors.

Before that, an equivalent of the above video is here (experienced by all of us when we opened the Lays packet) is here https://www.bakeryandsnacks.com/Article/2018/06/20/How-much-air-is-in-your-bag-of-chips

It was, I think, early 2000's and Colgate & Pepsodent were locked in a deadly competitive fight in the market.

Colgate, thought to be the market leader, was whacked out of shape in a few markets - Tamil Nadu, Kerala, Delhi, Bihar and Punjab, where they trailed Pep!

This happened after a dramatic ad in 1997, released by Pep, claiming they were 102% better than the leading toothpaste (shown as packaged in Red - no prizes for guessing) ... that tilted the scales, hitherto loaded in favor of Colgate, towards Pepsodent.

Soon enough, Pep became a rage across the toothpaste market, and became a perfect foil for Unilever's portfolio of Close-up (then available in Red, Blue and Green).

Pep was a "white" toothpaste, while Colgate Gel couldn't really compete against Close-up.

Colgate bore the brunt of the Pep onslaught on the white toothpaste market & blinked in a few markets, where their position was anyway precarious.

Hence they surrendered market leadership.

One of the important SKUs Pep launched to surprise Colgate was a flanking SKU - 40g at INR 10. This SKU was pitted against Colgate 50g (their lead SKU in their portfolio and their margin driver) priced at INR 12.

Those were the days when coin change was difficult to come by (there were local / county / sectoral / market-level custom-currency, if you remember) and Pep beautifully addressed it with an INR 10 price point.

Price points mattered then.
Price points matter now.

The price points of INR 1, 2, 5, 10, 20 all are considered, even today, POWER price points, because of ease of use, memory, usage and recall, not to mention channel convenience (due to small change problem, mentioned above)

Pep, 102% better as claimed, with a 10-rupee price point, out-smarted Colgate, who found it difficult to reduce 50g SKU's price to INR 10.

They had to rework their SKU strategy to come back with a 10-rupee SKU. But then, the first mover advantage had long been taken over by Pep.

Moral of the story - make sure that the customer's "perceptional" needs are managed.

Here in this Pain Balm's case, they are giving a certain "value" for the pack, even if it is hollow in the bottom.

The consumer perceives that value. May be, if the pack is thinned out, she will not see it as valuable.

However, the consumer pays for the packaging, and she will wield power only if she REALIZES that.

If it were a smart product manager, s/he will launch a power SKU with a power price point, with a smaller quantity, thinner pack and at a reduced price - saving costs of manufacturing & packaging and reinvesting the same in brand building

Colgate lost the game to Pep because of a perception battle (they recovered smartly, after nearly 10 years is another case study altogether) .. in early 2000s

But the fascinating play of packaging, pricing and perception continues, to date, fascinate me.

There are, at least, two more associated stories on popular salty snacks & their consumer perception/packaging interplay I can talk of, but that is for another day!

<END>

Reference to the ad of Pepsodent disparaging Colgate

https://www.financialexpress.com/archive/hll-colgate-back-at-war/94764/