Hook
So I was sent this somewhat viral video where this guy is in a grocery store and is highlighting the number of options you have for Dawn soap, all with somewhat meaningless distinctions. And he was like, dude, help me understand the psychology behind this packaging strategy. And for better or for worse, retail and CPG happens to be this niche that I work in. So basically, here are three reasons why you see so many options from the same brand. The first reason is it's a defensive strategy. Now the ways that stores like Target, Whole Foods, Walmart plan their shelves is through these things called planograms, which seem fairly self-explanatory. If you are Dawn soap, for example, the area that all soap products may have may be limited to this. So if you just have one product, it's like, okay, well all this other space remains. And that means other competitors can slot their products in there. But if I have a bunch of different variants and options, I can push the retailer to give me more of these what are called facings. And in doing so, I crowd out the opportunity for any other emerging brand to take one of these slots. Number two is what we can call total market coverage. Say I'm shopping for toothpaste. Maybe I'm a guy and I'm just like, hey, you know what, my teeth are kind of yellow, I'm looking for the Max White. But maybe there's someone else there who has bad breath, so they're like, you know what, I want the Max Fresh one. And someone else comes in and they're like, yeah, I want Max Fresh but I want a different flavor. You start to see that all of these products are basically functionally the same, but a brand like Colgate wants to make sure they can capture every type of customer preference. Again, so that these customers don't go buy Arm & Hammer. Number three, when you're shopping in retail, most of the purchase decisions that are being made are just kind of happening impulse in aisle. So there's this idea that the more visibility you have, the more facings you have, that can actually meaningfully drive sales of your kind of total product and brand. Because what's most important in this context is just getting a shopper's attention and you can get that through visibility, through the shelf real estate. So that is how we end up with all of this. Is it necessary for the consumer? No, not really. But so here we are.
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