One pack, two pack, big pack, small pack.
While CPG companies’ packaging strategies are far more complex than a Dr. Seuss book, the general principles hold true. As companies adjust or add pack sizes to meet changing consumer preferences, there are new implications from production to recycling.
“They’re going to have to make line changes and equipment changes,” said Jonathan Quinn, vice president of marketing and sustainability at Accredo Packaging. “There’s a waterfall effect, no matter which direction you go.”
Permission granted by Coca-Cola
But CPGs aren’t shying away from shifting pack design and size, a practice known as price pack architecture. This year, Coca-Cola rolled out its newest packaging innovation in the U.S.: “Sliim” cans, which contain the same 12 ounces as standard cans but in a taller, more slender shape. Beverages such as Coca-Cola Classic, Diet Coke, Fanta and others are in these cans nationwide.
It’s part of the soft drink giant’s strategy to meet “consumers’ fast-changing preferences,” a Coca-Cola spokesperson said in an email.
“Many consumers are interested in smaller portion sizes, while others are trying to stock-up with larger multi-packs,” the spokesperson said. “We will continue to evolve to meet people’s preferences.”
Shrinking sizes
As CPGs introduce different options, packaging design doesn’t change dramatically. Food and beverage manufacturers want their brands to be recognizable on the shelf, regardless of pack size.
But in general, experts said, individually packaged goods tend to be less sustainable from an end-of-life standpoint.
High-volume, low-priced small packs typically require mixed material packaging, Quinn said. Manufacturing equipment is designed to run quickly to produce large supplies using mixed material packaging, making mono-material packaging uncommon for salty snacks.
“Whether it’s potato chip bags or Goldfish … those packages don’t have the capability as it stands today to be mono-material,” Quinn said.
Mixed materials tend to have limited value for recyclers, so more often than not these snack wrappers end up getting disposed.
Smaller pack sizes gained popularity as inflation raged. Some manufacturers resorted to shrinkflation, while others hiked prices. But CPGs saw a gap in the market as they raised prices. There was no longer a low-priced product to meet the needs of cash-strapped consumers.
CPGs then faced a critical question, Ellen Kan, partner at consulting firm Simon-Kucher, said: “How do I create new smaller packs to refill some of those trial or opening price point packs?”
Companies moved to fill the gap. Hershey introduced a 9.5-ounce size of its Dot’s pretzels. The company described it as an entry-level price point. Mondelēz is “innovating in the small pack format,” said Dirk Van de Put, CEO of the company that makes Oreo and Triscuit products, at an investor conference last month. And chip maker Utz Brands is “laser-focused on our price-pack architecture strategies up and down the ladder, evaluating smaller pack sizes at key pricing thresholds,” CEO Howard Friedman said during a February earnings call.
Cost is just one trend driving consumers toward smaller pack sizes. Generation Z (born between 1997 and 2012) prioritizes healthy food and beverages, said Venky Ramesh, vice president and business consulting head of consumer and services industries at EPAM Continuum. Smaller sizes appeal to the generation’s desire for moderation and portion control, such as a smaller can of soda or mini pack of snacks, Ramesh said.
More than 55% of Mondelēz’s snack revenues come from “mindful portion snacks,” Van de Put said. That’s either an individually wrapped size or a package with portion recommendations printed on the pack.
CPGs are also using small pack sizes to introduce potential new buyers to their brands. If consumers haven’t tried a product before, “that one-off, grab and go makes total sense,” said Taja Dockendorf, founder and creative director of branding agency Pulp+Wire.
For example, Conagra Brands, which makes Slim Jim, has expanded single-serve packs of its meat snacks. “They introduced it in the checkout lane, so they can drive impulse purchases,” Ramesh said.
Bang for the buck
On the other side of the spectrum, value-conscious consumers continue to seek as much product as possible. Instead of a low-priced single item, they’re going for family sizes or multipacks that provide the lowest price per ounce.
“Everyone’s trying to find that sweet spot,” Dockendorf said. “They want to be able to offer multiple sizes to the consumer to meet them where they’re at.”
The aforementioned CPGs producing smaller pack sizes are also expanding multipacks. Conagra introduced 14-, 26- and 46-packs of Slim Jim. Hershey’s pack sizes now include a 35-ounce family size of Dot’s, along with multipacks of popcorn. The multipacks, popular at club stores such as Costco, contain several mini bags of popcorn brands including SkinnyPop and Pirate’s Booty.
“There’s so many snacking occasions, so you need mini packs for those,” Ramesh said.
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Cole Rosengren/Packaging Dive
Sizing up can require more functional changes to packaging due to the need for an outer box or container, but it also presents an opportunity for sustainability improvements. For beverage multipacks, PepsiCo started shifting from plastic rings to paperboard to hold cans together, and certain Coca-Cola bottlers are opting for paper-based packaging rather than plastic rings or shrink wrap. In another trend, companies are increasingly using fiber-based packaging for their multipacks.
Family sizes also benefit from package design changes. While single-serve packaging is meant to be used once, family sizes require a resealing option.
“A lot of brands are using a gusseted pouch,” Dockendorf said, pointing to products such as granola, snacks and cookies. “We’re seeing a lot more resealability … to keep freshness and ease and convenience.”
Whether CPGs scale pack sizes up, down or both, they have to consider the entire design process. Introducing new SKUs could require upfront costs and changes to equipment. It could also reduce manufacturing efficiency if there’s a large variety of sizes. Quinn said at times, marketing makes a decision and communication with the packaging team is an afterthought.
“Then it’s scrambling to pull a rabbit out of a hat and make it happen,” he said.
But processes are beginning to change, according to Kan. Manufacturers are starting to think about the key prices they want to hit in the market, and then considering how packaging changes can meet that price point. It creates what Kan described as a feedback loop between marketing, sales, supply chain and packaging.
“It’s a mindset shift from, ‘let me just design the product and then I’ll price it,’” she said.
