Heinz Plastic Ketchup Bottle –Does it Create Significant Customer Benefit?
Heinz new plastic bottle design creates new flexibility for the product and enhances the ease of use and storage in a way that can be positioned as an innovation in product design and functionality. This product development was largely driven by technological enhancements versus market pressures, and therefore the enhancement of features needs to be positioned as solving a significant need or desire present during the consumption experience and their advertising campaign should focus on how existing consumption “occasions” would be enhanced by the new packaging.
Heinz attempted to get a handle on consumer purchasing and consumption behavior through hiring Market Facts to conduct a market study. The Market Facts study created a wealth of usable data but this case does not illuminate whether the features outlined in the market survey were deemed important by Market Facts or were created through customer feedback. When determining whether the plastic bottle is in fact a product innovation, the product manager needs to have a sense of how people use the product and what features the consumer found to be important when deciding to purchase Heinz versus a competitor. Understanding and enhancing the consumption experience through ease of use in the packaging is essential to marketing this product.
Due to the product mishaps that can occur during a consumption experience, the enhanced safety of the new product can be leveraged to create a sense of product innovation. A large amount of ketchup’s eating occasions occurs in environments where the safety of the plastic bottle will be an advantage. With 30% of the ketchup eating “occasions” being experienced by children and with the highest period of volume consumed occurring in June and July (most likely due to outdoor eating events, which is shown by the most popular uses for ketchup – hamburgers, French fries and hot dogs-), families will find the limited amount of mess (due to the bottle’s new opening) and the shatterproof design to lessen the stress of such events.
Product size seems to be a factor in purchasing decisions, and the data that highlights the increased percent of purchases for the 32 oz. Bottle has impacted Heinz’s decision to create a 28 oz. Bottle (versus a larger size). Where the survey data shows that the 32 oz. is purchased last 53% of the time, the data does not illuminate why. It could be due to a human behavior where we realize that purchasing in larger quantities is cheaper by volume but we feel financially uncomfortable purchasing the largest size, or it could be due to the way the bottle fits within the refrigerator or how easily children can handle the bottle; and perhaps consumers would regularly purchase a 40 oz size if that was the next to the largest size available. Again, studies on consumer behavior in relation to size purchasing decisions would be useful to either leverage when promoting the ease of use of the new product or to be aware of if it creates negative consequences.
Heinz attempted to measure the customer ease of use with plastic versus glass and there is strong case for Mrs. Johnson’s assumption that the plastic has distinct benefits to the consumer. The visual appearance measurement seems frivolous when compared to the earlier data that does not show a high preference for one ketchup brand over another. The data does show a preference for plastic over glass in relation to how adults and children are able to handle the packaging. With the large number of ketchup purchases driven by discounts, it can be assumed that ketchup purchasers are financially conscious, however most 62% agreed that the plastic container was worth purchasing even if it was more expensive, though 83% would only purchase the plastic container when replacing their existing glass one.
There are a variety of product features that can be characterized as marketing risks and need to be addressed before they result in a negative customer reaction. These include the fact that the bottle is shatterproof, but not unbreakable (and it becomes more brittle with refrigeration) and the plastic bottles require refrigeration while the glass bottles do not. These product weaknesses should be addressed (at least indirectly) through Heinz marketing and customer education campaign, but do not present a large threat to market adoption of the new product.
Heinz needs to be careful when marketing the positive values of these new features. When attempting to market the increased thickness of its brand in comparison to Hunt’s, Hunt filed a complaint in 1982 with the National Advertising Division of the Council of Better Business Bureaus arguing that the thickness claim was not substantiated. This challenge (and the product improvements that were made by its competitors) resulted in Heinz loosing half a point in market share. Advertising campaigns for their squeeze bottle therefore, should be careful in outlining the new features.
The latter part of the case suggests that the product manager is looking into creating and marketing Heinz plastic mustard containers partially based on the market survey results collected for the Heinz ketchup study. The product manager needs to be cautious when assuming that the market tests would be similar. Whereas it is safe to assume that ketchup and mustard are used in some of the same consumption environments (increased sales during BBQ season and most often used on hamburgers and hot dogs) the consumers are slightly different. Due to mustard’s spiciness, children would not be the largest consumers and preventing spills is not a predominant purchase factor.
Whereas ease of use is an exploitable feature in the new ketchup product packaging, it would not necessarily hold true for the development of mustard product packaging due to the different behavior use patterns. When using ketchup, users have been trained to pour the product on top of their plate or food. Ketchup is almost never spread on a sandwich, whereas mustard is. This difference in behavior means that ease of use; decrease of spillage would not be features that would drastically enhance the purchase of such products. Similar to the benefits to the ketchup plastic container marketing and positioning decision, surveys that analyze customer behavior during the consumption of mustard products would provide valuable insight as the product manager embarks upon developing and marketing mustard in plastic containers.