Insight

tech_retail

December, 2014 | by

Tech Retail

The Consumer Tech retail channel is as massive as it is competitive. Products and brands that seem to take over the market one year can disappear the next without a trace. Every year at the Consumer Electronics Show 150,000 people converge on Las Vegas just to get a glimpse of some 20,000 new products that will hope to filter down into a store near you. For those that successfully make it into your hands and then to the cash register, product packaging is where the “rubber met the road.”

It might come as a shock to learn that electronics retail has existed for over a hundred years, but the last 30 or so have seen massive growth that dwarfs the previous 70. A mind blowing thought when you consider the telephone, radio and television are all part of that “non explosive” ratio and all 3 had a 98% penetration rate in US homes by 1980.

The biggest advances in technology over the past 30 years can be categorized in 2 ways: informational and mobile. In the 1980s we saw music and TV go mobile with the Sony Walkman and Watchman, and those brick shaped mobile phones from Motorola. From that point forward, these technologies have converged into one single device that fits into your pocket while also performing countless other tasks all at a single touch. And if you thought that this convergence has made our need for electronics lessen, not so fast.

Today the consumer tech market generates over $230 billion dollars a year in sales in the US market alone. The big 4 of electronics retail, Best Buy, Wal-Mart, Apple, and Target have a total of 15,000 store fronts combined and account for a third of all annual sales. Another third accounts for direct to consumer sales from HP, Dell and Amazon and the final third is everyone else.

Knowing how these retail environments work is critical to your success and they are all different in one way or another. For example, at Best Buy product packaging has to work very hard in order to differentiate themselves from their competition. Sales associates, called “blue shirts,” have very little knowledge from one product to another and you’ll be merchandised right along other brands selling similar products.

Over at Apple they deploy a somewhat unofficial referral based system. Meaning, if you ask three separate sales associates what iPhone case they would suggest, you’ll get three different answers. Referrals indicate that the sales associates actually know the product intimately enough to have true opinions, which is great. It’s for this reason that packaging plays less of a critical role here than in the other three retailers.

At Wal-Mart and Target you’ll have to do the heavy lifting in terms of education on your packaging, because in these retailers the customers are left on their own. The lack of sales associate help is reflected in cost savings, but you’ll still need to compete with your competition for the attention and understanding of a far less sophisticated customer.

In three of the four big retailers (Best Buy, Walmart & Target) the stores are laid out in long rows or aisles where different products hang from hooks packed in close together like sardines. The tops of these aisles are often at or below eye level so much of the time you’re looking down at multitudes of products.

With these three very different retail environments, here are three principles for creating effective consumer tech packaging:

Know your competition

If your goal is to distinguish yourself from your competition and attract the attention of your customer, then doing a quick competitive analysis at the onset of a project can be an invaluable exercise. In addition to buying samples of competitor packaging it’s important to break things down even further. What primary and secondary colors are your competitors using? What is everyone communicating at a browsing distance, say ten feet away? What is the voice of these other brands? If they have a strong position in the market what is that position and how does that effect your decisions when you begin to communicate to the world?

For example, Otter Box phone cases have a very strong position in the market: protection. However, their competition is all over the map. Incase = fashion, Speck = creativity. A brand’s position in the market can really effect the meaning it has in the mind of the customer. Knowing where your competition is in terms of the meaning they’re trying to create will help you navigate these waters and take advantage of the opportunities at hand.

Keep it simple

There are a ton of brands in every category, in every retail aisle, competing for the attention of the same customer. The typical strategy is to add more information, more features, more benefits than the product on the hook next to you, but that much noise created from so many brands communicating in this way can be overwhelming. Keep it simple for the customer to choose you. Either visually or through simple wording, help them by communicating the complex in a very simple manner. What is the one reason that anyone should care why you made this product and sent it out into the world? Why does it matter to them in terms of the benefit? And then communicate that one thing in a simple and compelling way. Remember, if you try and communicate one thing the customer will process that one thing, but if you try and communicate three things the customer will process nothing.

Be true to yourself

Every company has a soul or a culture that is often created at the top and trickles down to every employee below. It’s like your fingerprint and no two are the same. So why do you see so many “me too” brands that look and sound the same? Well, because most are simply copying their competition which, in the long run, will not help them build a strong brand. No one can be you; just look at the hundreds of companies that are trying to be Apple. Have any of them succeeded in doing so? Communicating your authenticity consistently through time will build you brand loyalty. There are no short cuts to earning trust so before you create a communication device like product packaging, look inside of your own company first and then project that meaning through your packaging.