Connected Packaging In Focus: Beauty Brands
As packaging breaks into a fourth dimension – connectivity – beauty brands can take advantage of a new marketing channel activated through the product packaging itself. Connected packaging triggers a connection between the brand and the customer to last the entire customer journey.
Connected packaging technology is largely powered by Near Field Communication (NFC) and Quick Response (QR) codes which are the most popular ways to deliver connected packaging experiences and content.
Connected packaging holds a lot of promise for brands, but many marketers are still unsure about how to best make use of it. One-off campaigns lack the persistence and sustainability that most larger global brands will need. The solution is a more dynamic connected marketing ecosystem, wherein brands can build their messages on the fly. Brands need a platform that can manage the entire ecosystem dynamically and in real-time.
Connected packaging for beauty brands, including cosmetics and skincare products, gives customers what they want most:
Customer incentives such as coupons and loyalty programs are crucial in the high margin cosmetics and skincare business. Since gross margins in cosmetics average around 80%, the category is an ideal candidate for loyalty programs. Customer loyalty rewards act as a barrier to brand-switching. It is human nature to seek out value, therefore abandoning accrued rewards is counterintuitive to most consumers. Fickle customers are less likely to switch if there is a risk of losing hard-earned loyalty rewards. In addition to serving as a switching barrier, loyalty rewards can appeal to status-seekers by creating progressively lucrative rewards based on where individual customers rank in points earned.
Driving loyalty programs through connected packaging ensures direct customer access instantly, any time the individual handles the product, maintaining the relationship throughout product consideration-ownership-consumption-repurchase cycle. Connected packaging helps resolve the problem of tracking purchases from retail resellers, providing each unique product with a unique identifier and attributes. The connected package keeps rewards and loyalty top of mind, and lets brands trigger a connection to last the customer lifetime. Traditional brand loyalty programs triggered by cards and apps are old school, activating your product in the Internet of Things paves the way for future innovation in customer loyalty rewards and customer retention.
Fifty years ago, you might drop by your local makeup and skincare counter. Twenty years ago, you might send them an email. And now more recently, most brand communication has been pushed through social media. But as each new generation achieves purchasing power, it becomes clear that social media networks are highly generational, younger generations choosing to use a newer network that is not seen as “old school”. No one wants to like what their parents like. The fleeting popularity of social media is only one issue – the other major issue being the increasing divisiveness of social media platforms, where the crowd controls the message, and where crowds easily turn into “mobs” that are able to turn something positive into something negative.
As beauty brands seek to regain control of their message and want to guarantee more positivity and inclusiveness in their communications, the Internet of Things and the connected package can turn products into communication hubs, closing the loop so brands and customers can communicate and build reciprocal relationships, and where brand fans can communicate with each other in safer, more inclusive spaces reserved for loyal customers. Instead of directing their message into a void, cosmetics and skincare brands can target customers who are considering the product, and later to a customer who has purchased the product. Messaging is specific to each stage in the customer journey, and even to a specific, unique customer.
Consumers are after increased transparency and more product knowledge when considering their purchase. Many shoppers, especially younger ones, consider factors including social responsibility and environmental impact. Beyond the raw ingredients of the product, people may want to know where it was made, by whom, and under what conditions. Others might want a fully vegan product or to be assured it was not tested on animals. All told, the information that consumers are after could never possibly fit on a small cosmetics or skincare package, even if all aesthetic concerns were foregone.
What do you do in this case? You activate it within the Internet of Things. A connected package can provide instant access to all the information shoppers need to make a purchase decision, in-store and directly from the package and in multiple languages. This means not having to find a salesperson, or “google it” (unless you love doing extensive mobile research while standing in the middle of a store). By simply tapping or scanning the product with their mobile phones, consumers can connect to a wealth of product information, getting all the answers they need to quickly with no fuss or distraction by other brands.
A recent study conducted by Clicktale and the Wharton School of the University of Pennsylvania concluded that shoppers are pulled towards entertaining content and “guilty pleasures” more so than they are to hard facts. It’s no secret that people like to be entertained, so fun campaign promotions, videos, and games can actually add value to a product, and be the differentiator when up against the competition. Again, for higher margin products such as cosmetics and skincare, entertainment makes a lot of sense.
By using connected packaging to launch entertaining experiences, beauty brands can target specific lifestyle moments and augment the experience of using their products. In the Internet of Things, the product becomes the trigger for fun, not just entertaining but entertaining for everyday moments, transforming mundane into extraordinary.
Connected packaging for cosmetics brands and skincare brands makes sense. In the Internet of Things, a connected package can meet and exceed consumer needs. It transforms everyday “real world” experience into something fun and engaging. Forward-thinking brands will secure more loyal customers in a competitive market.