Essay: The prospering dairy industry

Chapter1: Introduction

The prospering dairy industry of the country seems an embryonic market for branded dairy products, especially in the urban areas, where branded and packaged milk, curd and butter are rapidly capturing the market.

In fact, the consternation of adulteration, germs, decades-old style of improper handling of dairy products, particularly loose milk and curd by milkmen and shopkeepers, are impelling a large number of consumers in the country to bid adieu to the traditional milkman. Consumer preferences have changed in the favor of packaged dairy products (Austin and Kohn, 1990), which ensure better hygiene and good value for money.

The primary significance of this research is to contribute to the development of the Pakistani dairy industry by an advanced approach towards value added products, which in my field of research is packaged milk. The largely changing attitudes of the consumers of dairy products (Abid et al, 2009) are another area this research focuses upon. In this respect, this research is aimed at benefiting the local dairy processors in progressing as an industry as a whole and to further enhance competitiveness amongst the international dairy market.

I have chosen this topic to study the buying behavior of consumers of Pakistan on the basis of packaging used in marketing of the brands. The study will focus on products in dairy industry of Pakistan. Marketing plays a vital role in the success of brands and packaging is one of the important aspects of marketing (Stewart, 1996). It is very crucial to study different aspects of marketing which pursue the consumer to make a decision towards the brand. One of the main elements of any marketing campaign is the packaging used for the products.

Research has been already done in this area studying the impact that packaging has on the consumers of various categories in different parts of the world. One of the areas which have not been covered before is building of a brand and countering increased competition through its improved packaging. I have carried an extensive research in Pakistan on studying how companies in fast moving consumer goods industry build their brands with the help of packaging of their products. There has been research done on psychological impact on the mindset of the consumers when making a purchase. We have taken the help of the research to identify the psychological impact on brand perception by the targeted consumers.

The methods used for the research includes both quantitative and qualitative methods. There are questionnaires floated to the targeted consumers of the industry in Pakistan. A detailed analysis of these questionnaires has been done using different quantitative techniques such as SPSS. The results are analyzed and explained in the research. The qualitative part includes focus group with the consumers of these goods. Another element of qualitative research is interviews with the retailers of such consumer goods which helped us identifying the crucial factors in the industry. The use of quantitative research helped us gather data more efficiently and gave better results than any other type of research as the research is consumer based (Sinkovics et al, 2005). The use of qualitative data has its own importance giving the point of view of the sales people. It helped us identify the thought process that goes beyond brand manager’s mind before launching a new product. The use of all these research techniques provided us with better analysis of the study.

The results of the study will provided us with the factors involved in building the brand with help of its packaging. It is an addition to the literature available in this area with a more focused research in brand perception with respect to packaging. It will fill a gap in the research area of marketing. The managerial implications include helping the corporations in fast moving consumer goods industry to focus on issues which are evident in this research. The main elements discussed will help the companies in drafting their brand and packaging strategies to counter competition in the market.

In a nut shell, the study will focus on all the elements related with brand perception by consumers in marketing of fast moving consumer goods companies in Pakistan. An extensive quantitative and qualitative research will be carried out using different techniques. The analysis would be done on the results of the research and analysed critically. It will provide a guideline for managers of brands about the elements that play a vital role in the success of any brand.

1.1 Dairy Industry of Pakistan

Pakistan has been long well known for its dairy industry and runs it as one of its major industries in the country. However, it has remained unable to make a market amongst foreign competitors due to its products being limited to the basic. Pakistan’s yearly production is almost 33 billion liters which is produced and handled by 8 million farming households by making use of 50 million animals. Pakistan is the 4th biggest milk producing country (Associated Press Of Pakistan Report, 2010).

According to most recent statistics the livestock and agriculture of Pakistan contributes 10% to the GDP, the milk economy accounts for a total of 27.7% contribution to the agriculture sector. It is an untapped market and is forecasted to grow additional 3 billion liters in a couple of years, which would make it one of the fastest growing sectors of Pakistan (Pakistan Dairy Development Company, 2006). According to a study on Milk marketing conducted by FAO in Pakistan in 2003, out of 33.6billion liters of production of milk, , 80% of the milk in the country is collectively produced by rural commercial and rural subsistence producers.

The semi urban producers account for 15% of the milk production, whereas urban producers contribute 5% to the total milk production in the country. Only 5% of the milk is processed and is marketed through formal distribution channels whereas the other 95% is being distributed by the middlemen in the urban and rural areas. This accounts to be 0.43% contribution of the formal sector to the real GDP of Pakistan in the year 2004-2005. The formal sector (UHT) market are the milk producers in Pakistan which totals to be only 3%, which is only a small percentage, are growing at a stable rate of 20% a year. Initially the dairy sector did not receive much attention.

The households would engage a Gawallah(milkman or middle man) who would supply the everyday supply of milk to the nearby vicinity. In order to purify it and to kill the bacteria the milk is boiled and cooled down for later consumption by the households. Usually the milkman in order to increase the milk supply would adulterate the milk with water which would make the milk impure and deteriorate its quality. In 1986 “Haleeb” milk came into the scene and within the next couple of years the highly renowned and experienced Swiss based company Nestle acquired “Milkpak” which is now the market leader in providing UHT milk in Pakistan from past couple of years. In the early 90s Tetra pack started their campaign of hygiene bacteria free milk; moreover their main aim was to educate the masses about the health hazards of loose milk which is supplied by the local milkmen. Also they wanted to build awareness about the quality, purity, freshness of the packaged milk which is free from preservatives. Till the mid of 90s milk production was the least commercialized enterprise in the agricultural economy. It was during the early years of the 21stcentury that the dairy sector became slightly more commercialized with the emergence of two new companies in the sector: “Olpers” and “Goodmilk”. The former enterprise emerged as an aggressive player with attractive new ad campaigns emerging after almost every six months and managed to gain second highest market share as a UHT milk producer in Pakistan after “Nestle Milkpak”.

The dairy sector now stands at its turning point. The advertisement campaigns and the competition between the oligopolies of milk enterprises have benefited its consumers the most(Pakistan Dairy Development Company, 2006). A demand shift can be viewed from that of loose milk to packaged milk. Milk consumers now have a variety of brands of milk to choose from which would suit their needs. The majority of national livestock herd is distributed in small units throughout Pakistan. About 55 million landless or small land holding farmers are responsible for the bulk of milk production produced in the country. Buffalos being the major milk producing animals produce most of the milk in Pakistan whereas only small amount of milk is produced by cows as Pakistan’s consumers prefer buffalo milk over cow’s milk.

UHT producers of milk have made collection points in rural areas from where they collect milk from small scale farmers. It develops into a hassle for the collectors as they have to face problems due to poor infrastructure, quality assurance of the milk produced by farmers, inexpert manpower and seasonality issues. Low productivity and uneven farm base makes it inefficient for collectors to collect milk from farmers as collection becomes ineffective due to this. These difficulties create serious threats to the dairy industry of Pakistan which can only be eliminated by providing subsidies by government to the farmers. To make Pakistan’s dairy industry competitive against world’s dairy sector Pakistan’s dairy industry needs to be developed with respect to international standards.

1.2 Consumer Attitudes

Health conscious consumers

The concern for the corruption, germs and bacteria and improper handling of dairy products, especially milk, is diverting the consumers towards a safer product(Prucha M. and Harding H.). Consumers have to the highest degree abandoned the traditional means of purchasing milk, that from a milk man or ‘gawala’ due to the raised health concerns and awareness. The fears and health hazards relating to loose dairy items are steadily changing the mindset of the consumers. Seeing this change and an enormous untapped potential of growth in packaged dairy products in the country in future, my research spotlights this changed consumer approach towards loose milk and further addresses means of how to completely cater to this need through the element of packaging. This analysis was derived through extensive consumer research of how willing or open they are in their acceptance of various packaging elements to cater to various consumer groups and needs and lifestyle.

Consumer choice

With this much established, another facet to the packaged milk industry opens. The emergence a huge multinational, Nestle, in the packaged milk product and later a local giant, Haleeb, the consumers were exposed to vast choice in the product. The companies offered value through various means such as UHT treatment and several layers of packaging to enhance milk safety and life(Associated Press Of Pakistan Report, 2010). Following this trail, others also introduced their competitive products which exposed the consumers with a great choice, making them ever so more demanding in every respect. Newer techniques were offered by brands to counter this competition, making it extremely challenging to deal with the dynamics of high consumer expectations. My study further seeks to benefit these manufacturers and processors by identifying the methods of packaging accepted or demanded by the consumers that will provide them an edge over competition, especially in the international market.

1.3 Need for Innovation

My research also pinpoints the necessity of innovation to completely tap the purchase gap in the market. Pakistan’s huge population of 160 million opens up doors for significant potential for packaged milk, especially in the urban areas. With this said, my research establishes the need for modern techniques of packaging to revert the raw milk product into a value added product, primarily through the tool of effective packaging, suitable for the exceedingly demanding consumers of today. This will help the companies an edge over others to build their brands.

1.4 Significance of Research

The primary significance of this research is to provide an advance approach towards the importance of packaging for countering increased competition on national and international basis. The largely changing attitudes of the consumers of dairy products are another area this research focuses upon; how are they affected with changes in packaging and its impact on the industry. The research also focuses on packaging as a medium of communication for brands to their consumers. It will identify all the advantages for the companies if they utilize the packaging on the products.

1.5 Value added approach

Pakistan has been long well known for its dairy industry and runs it as one of its major industries in the country. However, it has remained unable to make a market amongst foreign competitors due to its products being limited to the basic. Understanding the importance for value added products, I have focused my research on one of the major elements that contributes towards this progression from a basic commodity of milk to milk as a branded product that captures the consumers trust and raises their willingness to pay a higher price for the added value. One of the major milestones from emergence of products to value added products is their packaging. Packaging plays a vital role in value addition and brand building for the products. Having said that, packaging of milk and its various techniques and methods have been explored that will provide the consumers with a higher worth product and will increase margins for the dairy processors. My research has highlighted the need for branded dairy products, especially milk to truly penetrate the local as well as the international market.

Leading Packaged Milk Brands in Pakistan

Chapter 2: Literature Review

2.1 Marketing as a tool to counter increased competition

Companies are relying heavily on marketing strategies to counter increasing competition in today’s world (Evans and Berman, 1992). Brands are focusing on 4p’s of marketing to help establish themselves in current markets. Integrated marketing communications is also playing a vital role in establishing brands and helping companies to compete in the market. All areas of marketing have been affected by the technological advancements in this field over the past ten years. Media and internet has played a significant role in making communications a better toll than ever before in the history of marketing. One of the most affected ones is the consumer. They are bombarded with hundreds of ads every day. Packaging has also taken a very importance place in marketing strategies designed by companies (Wansink, 1996). It has become a tool for firms to counter increased competition and present them in a way which has never been done before in the history.

2.2 Synergy in Marketing

The most important benefit derived from the marketing is synergy. The best definition for synergy is 2+2 = 5. It explains that by bringing together various forms of marketing, you perform better compared to using all forms of marketing separately (Brooksbank, 1994). The best way to adopt this strategy is use same message through all the mediums like using the same images or quotes through TVCs, outdoor, radio spots and especially on the packages of products. It makes a space in the mind of consumers about the perception of the same product. If all these messages are different, it is possible that they can interfere with each other ending up giving different messages altogether. It created confusion in the minds of the consumers. Therefore, it is very important that a brand’s packaging is specially designed in line with its other marketing strategies otherwise package can send different message to consumers.

Packaging can act as a very helpful tool if adopted in co-ordination with other departments (Calver, 2007). It can act as a positive synergy thus benefiting the firm, but if it’s not implemented properly it can create a big mess for the organization.

2.3 Ethics in Marketing

“There is little doubt that the impact of packaging on the environment is gaining increasing recognition from consumers.” (Prendergast and Pitt, 1996)

As consumers are more aware today than ever before, the least they expect from a brand is to communicate something that is unethical. The consumers are seriously concerned on how the sourcing of packaging materials affects the environment, pollution, resource use and solid waste. The governments have also started taken interest on how packaging is impacting on the environment (Livingstone and Sparks, 1994). The main issue faced by the companies today is to design a package in compliance with all these regulations and on the other hand it should protect, promote and make the product attractive.

“Something that is functionally effective may or may not be ethically acceptable.” (Fill, 2005, p. 89). The importance of ethics is a very crucial factor in business management. One of the most important factors of marketing is that each and every message given through marketing activities should be ethically acceptable by the norms of the society. Unethical marketing can sometime provide a success to the organization but leaves a bad image of the brand at somewhere in back of the mind of the consumers (Gray and Guthrie, 1990). It is the responsibility of the organizations to keep a track of messages being communicated through the packaging of the products because the message once given cannot be reverted and could create a big mess for the company (Chonko and Hunt, 1985).

In advertising, misrepresentation is condemned by codes of practice. (Fill, 2005) states that in some packaging, enthusiastic use of images and language to convey the most optimistic view of the service or product being shown can forge the actual perception of the product in the minds of the consumers.

The content used on packaging has also been a cause of ethical problems in international marketing. They are caused because of the language and cultural differences between the world’s countries. Some words, gestures, symbols and colours have different impact on different parts of the world(Schlegelmilch, 1998). Each human being transcripts the message based on their culture and society. A message given through packaging can act as a positive message in one part of the world and can act totally abnormal or negative in other part of the world. The most common example can be given in form of values for colours. Green colour is a sacred colour for Muslims, white colour means purity in some parts of the world and it is linked with death and mourning in Asia(Schlegelmilch, 1998). The companies should take special care in choosing their colours for packaging as each and every colour has its own meaning.

2.4 Packaging

Packaging and packaging design have become an important factor in marketing diverse “consumer goods” and have a key role in communicating product benefits to the consumers (Rundh, 2009). It is also related with other variables in marketing mix and have a direct relationship with them (Czinkota and Ronkainen, 2007). Packaging is dependent on certain influences from other areas of the business. They include consumer preferences, logistics, environmental issues and technology advancements. Packaging design helps organization meet the new challenges faced by the logistics and supply chain.

If we study the literature of marketing, packaging is known to be a part of the product and the brand. It is argued by (Evans and Berman, 1992) that packaging is a product characteristic and property. (Olson and Jacoby, 1972) explains packaging is an extrinsic element of product which means that it is a characteristic of the product but does not include the final product itself. We can also take similar examples of brand and price, as they are also extrinsic elements of the products. (Keller, 1998) also suggests that it is not part of the product but it is one of the elements that make up a product which includes logo, name, slogan and the personality of the product. It is believed that packaging plays a role in buying and consumption process, but is not vital for the product itself (Underwood, 2003).

Another view is presented by (Zeithaml, 1972) which is something in between these view points. He believes that packaging is an intrinsic as well as an extrinsic feature of the product. For example, if we look at the information available on the packaging of product it is an extrinsic attribute but if we look at non-drip top it acts as an intrinsic feature of the product. The new trend of self service has transformed the role of informing the customer from a sales person to advertising and packaging. It is the reason why packaging is called “silent salesman” as it represents the benefits and qualities that we will attain from the product (Deasy, 2000).

If we go back in time packaging was considered as means of preserving and protecting products while they were in store and through their transport to the final consumer (Leonard, 1996). The main area in which packaging was treated lied in product strategy. It is also very much true to a certain extent but the technology has progressed by far and the choice for consumers is also widening as the time is progressing. Packaging has now become a feature by which consumers in today’s market base their choice before buying the product. It has now become an important feature for marketing communications used by companies especially fast moving consumer goods companies.

Products with low-involvement buying need the help of packaging to stimulate buyers into action. It has been proven through research that decision made for the purchase of FMCG products needs buyers to build awareness through brand awareness and recognition (Calver, 2003). It has become very important to give importance to the packages and wrappers of the products as it is very vital for persuasion of consumers towards your products. The importance of packaging can be witnessed through the case of Sainsbury and Coca Cola. Sainsbury came up with their cola with innovative design and packaging. It attracted wide range of consumers. The new packaging had so much effect that Coca Cola changed its packaging quite similar to the design of the Sainsbury Cola. It is a clear evidence of the impact of packaging on consumer’s minds that such a small company had an impact on the market and resulted in a change of design in its packaging by such a large company as Coca Cola.

In a nut shell packaging is dependent on several factors from all parts of business management which includes management, consumers, competition and supply chain etc. (Rundh, 2009) has illustrated in this diagram all the factors that play a role when packaging is designed in the laboratory.

2.5 Evolution in Packaging Industry

Initially in nineteenth century packaging was just a process of tying up a product or several products with a string and a wrapping paper (Porter, 1993). There was no concept of branding of products. They were only used for patent medicines but marketers realized their importance with time and the trend shifted to other products. Soaps, cosmetics and food products manufacturers and suppliers were the first entrants adopting this concept (Lindsay, 1997). Technology was also involved for mass producing the goods. The goods needed packaging and printing facilities to be as efficient as the production facilities. The organizations understood the increasing importance of packaging for the products. There was also an increased use of understanding consumer psychology to recognize their needs and focus on specially designed packaging for them (Phillips and Bradshaw, 1993).

On the other hand retail stores were increasing with self service. The products used to lie behind the shelf and now they were available to consumers where they can see the product, hold it, and make their decision at the moment (Bone and Corey, 2000). The packaging was gaining much more significance than ever before. For many years packaging was an important part of marketing strategies but there was not much innovation in designing and labeling the products.

In late nineteenth century more and more products were getting packaged which was never done in the past. There was new machinery specialized to pack all sorts of products into different forms of packaging. The packaging of these products was not only an attraction for consumers, but it was also helping in efficient supply chain and merchandising of these products Nancarrow et al, 1998). It also led to invention of a new field called package engineering. The study focused on how to devise new packaging techniques with lower costs for changing the production lines. They also focused on designs of packages so they don’t act as a hindrance for transporting the products to wholesalers, retailers and final consumers.

As we entered the 21st century packaging has turned out to be one of the most powerful marketing forces that we have in today’s world (Wells et al., 2007). Every brand is now focusing on aesthetic attributes of their products as consumers have a wide range of products in fron of them when making a purchase. The consumer of today has direct approach to shelf and they can easily pick and choose whatever they want to buy and the products that suit their needs. Packaging acts as a first impression for the product and persuades the consumer to make their decision.

“In the selling environment of a modern supermarket, the potential contribution of a superior package to profitability is simply too good to be ignored” (Twedt, 1968). Some of the non functional changes in packaging can also lead to changes in the sales figures for the products. Minor changes in the visual appearance can double the sales figure and vice versa a small change in packaging can now lead to a failure of product. It has been proven in a research “A Cash Register Test of Sales Effectiveness” in Journal of Marketing, 1962 that consumers expect the same quality from the product that is represented by the packaging of the product.

2.6 Importance of Packaging in Marketing

Packaging is one the most important characteristics of marketing. It has gained importance as new technology and innovation is coming and making the consumers aware than they were ever before. The retail food network has been very competitive and it has become more and more important for companies to take help of better and innovative packaging to gain advantage in the market. It has been explained by (Welles, 1986) how impulse buying is increasing day by day. Nine out of ten shoppers tend to buy on impulse behaviour. The main reason for impulse buying is attractive packaging and labels (Phillips and Bradshaw, 1993). They also discuss that unplanned grocery is almost as high as 51 percent of the total grocery purchases made by consumers in today’s world. It clearly explains that opportunity at point of sale should be used by using all the promotional activities and with the help of better packaging. It has been increasingly very important for the products to capture attention of the consumers. It is an effective way to communicate in grocery retail outlets with the growing competition in the market and the level of observation that the consumers are giving to the products.

The design of packaging has taken more and more importance in marketing diverse consumer goods to the consumers and plays a vital role in communicating the characteristics of the products to the consumers. The packaging of the product is also linked with other factors of the marketing mix (Stewart, 1995; Czinkota and Ronkainen, 2007). The companies in fast moving consumer goods industry use a range of packaging attributes, designs, combining colours, symbols, shapes and messages (Nancarrow et al, 1998). These factors help the products in attracting the consumers and sustain attention helping customers to identify the images they were given in other marketing activities such as advertising. The importance of packaging for branding is growing as it is playing a similar role to other marketing activities. One of the main reasons for gain in importance of packaging is that consumers don’t think before going in the store what to buy and they make impulse decisions in the store. Packaging is one of the major contributors to persuade them for their impulse buying behavior.

2.7 Communication dimensions of packaging

There are quite a few dimensions which can impact the utility and power of packaging. One of the most influential ones is colour, as the colour and tone of the product can persuade the buyer to make a purchase. It should also be seen that colour used should also match the class of the product; otherwise it can ruin its impact on consumer’s minds. It should also match with the branding strategy of the firm and cultural boundaries where it is being used as different colours have different impact on various cultures. We can take the example of white colour which is used as purity and cleanliness, blue means freshness, red boosts up the appetite and several other colours are used for sending different meaning to the target population (Giles, 2001).

2.7.1 Benefits of Packaging

Benefits are the advantages that people get from the purchase of package milk. These benefits are really helpful for the people as they ease out many of the problems that are faced by different groups of users of packaged milk. Fast moving consumer goods brands are introducing smarter packaging in order to effectively respond to competition (Underwood et al., 2001). The more benefits milk packaging will provide the consumers and the retailers- product safety, inform about product use, and safeguard the product during transportation and delivery- the more successfully the product will become evident in competition. The benefits that the milk packaging would provide can be a powerful marketing technique to add more value and drive the product up in competition (Packaging council of Australia, 1984). One of the advantages is reducing food spoilage for these products. Food spoilage is the process of decay in milk. It causes loss in the milk item. Spoilage can lead to a decrease in milk taste and can also cause illnesses. Packaging also helps protects nutrients in the milk. It means that packaging preserves the healthy elements milk contains like vitamin A and D, calcium, carbohydrates and protein and protects them from going bad. It makes it convenient for consumers to pour milk for their use. The extended life shelf is targeted to increase the durability of the milk. The milk life can be increased up to ninety days before it goes bad, opening up new opportunities for marketing milk to consumers demanding quality and safety.

The companies are focusing on environmentally friendly packaging to show their social responsibility (Stewart, 1996). This refers to the packaging that has reduced negative environmental impact. An example of such packaging is PLA, or polylactide, which is a plastic made from plant sugars, which makes it earth-friendly. It is cost- and performance-competitive with petroleum-based plastics, which are derived from fossil fuels. This nature-based packaging offers marketers a point-of-sale differentiation from the competition. Because it is fully compostable, it gives environmentally conscience marketers something to talk about on their brands. Recycling of these packages has been a new trend to optimise the resources. Recyclable refers to the reprocessing of old milk packaging materials into new packaging, with the aim of preventing the waste of potentially useful materials, reducing the consumption of fresh raw materials and reducing energy usage. Recycling is a key marketing concept of modern packaging design to attract environment conscious consumers (Stewart, 1996).

2.7.2 Design of Packaging

Design refers to the art and technology of enclosing, protecting or packaging milk for distribution, storage, sale, and use. As stated by (Cliff, 2002) packaging can be used by marketers to encourage potential buyers to purchase the product. Effective milk packaging should have features which add convenience in distribution, handling, stacking, display, sale, opening, reclosing, use, and reuse. There is a trend of hard to open package in the industry which makes it very difficult for consumers to open these packages. Hard to open packages refers to the inconvenient milk packaging for the consumers, which is complicated or demanding to open. This reflects on bad package design and can cause the consumers to switch to another milk brand with user friendly packaging. The new concept being used in west is putting resealeble caps on the packaging (Wansink, 1996). It is the ability of the milk packages to have caps that can be sealed on again for milk safety and protection. In milk packaging, these come in two forms: resealable caps on paperboard gable-top cartons, and snap-on caps for round plastic containers. These aid the product in the ease of use for the consumers.

The physical attributes of packaging is central to the brand in dealing with competition (Cliff, 2002). The physical aspects of milk packaging like the shape, size and opening feature of the package, stresses on the success of the product amongst competition. As milk is a generic product, a distinction amongst brands can be drawn through what the characteristics of packaging can deliver. By offering convenience of use to the customers through the physical elements of packaging, the brand can make its product stand out.

There can be different shapes that can be used for packaging the products. The purpose remains to make the milk product more attractive for the consumers. The variety of shapes in packaging may include gable-top package formats, spout closures, plastic bottles or paper cartons (Wansink, 1996). If the packaging is airtight, it will provide the milk with no exploitation from external sources. Airtight packaging keeps the milk fresh till the time it is opened. Airtight packaging not only benefits he consumers but the retailers by increasing the shelf life of the packed milk. The new designs being incorporated should also have all the sizes available for the consumers (Calver, 2003). When you have milk available in packaging, it’s easier for you to have different sizes which range for different kind of users i.e. personal, commercial or domestic use. More availability of sizes makes it easier for the consumers to make the purchase.

2.8 Effect of Packaging on Quality of the product

When we talk about the milk, the first thing that comes into mind is the quality of the milk. Quality is a very important attribute as it distinguishes the milk from other products, and consumers rely heavily on the quality of the milk. The quality of packaging undoubtedly leads the product up in competition as it promotes a higher perceived value of the product to the customer (Wills, 1990). With the milk product being similar, quality packaging can help brands deal with competition through effectively understand the changing consumer demands and market trends. The quality of packaging is the deciding factor for the consumers to choose one product over the other. The quality of packaging helps the consumer decide what the product will deliver (Bone and Corey, 2000). Hygiene is the reason which distinguishes packaged milk from unpackaged milk. Hygiene comes from the way the milk is supplied, if its packaged its hygienic and if its unpackaged it would be unhygienic. It is recommended by doctors and specialists not to consume unhygienic milk, as it is not safe for health. The increased consumption of packaged milk is largely due to hygiene awareness by the consumers.

Ultra-high temperature processing sterilization of milk by heating it for a short time, around 1-2 seconds, at a temperature exceeding 135°C, which is the temperature required to kill spores in milk. The high temperature also reduces the processing time, thereby reducing the spoiling of nutrients (Pakistan Dairy Development Company, 2006). It provides a shelf life of 2 weeks and destroys all the bacteria in milk. The other procedure to treat milk is pasteurizing the milk. This is a treatment thru which milk is heated at 110°C for about 20-30 minutes. Because of the long time in heat it has brown color and a little change in the taste. One of the best thing about treating milk in this way compared to other forms of treatment is that it increases the shelf life of the milk till the time the seal is opened.

Treatment of packaging in the milk product plays a vital role in acquiring an upper hand in the competitive packaged milk industry (Pakistan Dairy Development Company, 2006). Milk, being a health product, is an apparent reason for this. The consumer demand for healthiness is great when the product is milk, increasing the competitiveness in this industry. Thus, treatment of packaging ensures the rigorous standards demanded by the consumers and helps the firms gain a greater power over competition. This element of treated milk packaging to guarantee the consumers with a superior product presents yet another opportunity for milk processors to more effectively compete in today’s highly competitive packaged milk industry.

2.9 Labels used in Packaging

In today’s crowded packaged milk industry, labels are becoming increasingly important for brands to gain an upper hand in competition (Stewart, 1996).. Milk brands are looking for ways to distinguish their brand appeal quickly and cost-effectively. Effective labelling is just the way to handle this competition (Bergmen and Thomas, 2000). Labels in the packaging of milk are of great importance to the brands when addressing to brand awareness, customer knowledge, and distribution power. Labels are being used as the most modern marketing tool to gain a sharper edge over rivals in the clawing present day packaged milk industry. They are being aimed more and more at creating brand distinction to the cope up with the ever-increasing competition in the milk industry.

These are the papers or stickers that are used on the external side of the packaged milk boxes. These include the brand name, logo of the company and any message that the company wants to give it to its customers. Labels are a very efficient way for companies to communicate with their customers as the customers know that anything printed or written on the labels are coming directly from the company (Underwood et al., 2001). Consumers are now interested in new colours and multi colored boxes (Bergmen and Thomas, 2000). Companies should now focus on adding new colors to their boxes and get rid of the white color as it is no longer an attraction for the consumers. One of the things which are ignored by the companies is how to utilize the external space on the boxes or bottles of the milk (Deasy, 2000). They should efficiently use the space which is left out and use it in their favor to promote their product. This extra space could be the bottom of the box, or the lid or the inside area of a cap.

We know that one of the major reasons for the consumption of milk is the nutritional gain that a person gets from drinking milk. This perception can be used in company’s favor by adding nutritional tips or recipe on the boxes or labels of the cartons. This can make the consumers more satisfied and make them feel healthier. Graphics make labels look good or bad (Deasy, 2000). Graphics are different forms of mix of colors and designs that a company uses in formation of a label for the box to be used to package milk. Graphics make the box attractive, which in turn persuades the consumer to buy the product when he gives it the first look

2.10 Effect of Packaging on Margins

Where packaging can aid in countering competition, it can also act as a drawback for the packaged milk brands. Packaging can add an unwanted amount of cost for the retailers putting them behind in competition. Where convenience packaging, for example gabletop cartons, is becoming increasing popular, the prices for packaged milk is also going up, something the consumers are unwilling to pay for. Thus, the brands, in this respect to packaging, suffer in the extremely competitive environment when their costs are not met. Providing a value added feature in packages kills the margin for the retailers, forcing them to increase the final product cost and lagging behind in the extremely competitive packaged milk industry (Lindsay, 1997). As milk is a very competitive industry and each rupee or paisa counts in the cost of the final product. Good packaging is preferred by the customers but on the other hand it reduces the margins for the company.

2.11 Packaging for specific target markets

The packaging has to be done keeping in mid different segments of people that use the milk. For children it has to be user friendly, for housewives it has to be easy to store. Target market should be kept in mind before designing the packaging (Phillips and Bradshaw, 1993). If the product does not meet the needs of any target market, there are chances of loosing that segment. Packaging should be designed keeping in mind different uses of the packaged product. Some people need less amount of milk for their personal use and some need in large quantities for commercial use such as restaurants. It should be kept in mind to design the packaging keeping in mind their ease. Through diversified packaging aimed to cater to different consumer needs, packaging can facilitate a brand in gaining an edge over competition by penetrating into various target markets (Peters, 1994). The needs of today’s milk consumers are distinct, thus brands can use the tool of packaging to accommodate to various needs of consumers, expanding their consumer base and ultimately resisting competition. By the medium of purposeful packaging, milk brands can provide to the distinct needs to consumers- kids, on the go milk consumers, multiple servings. A brand with the maximum target consumers is most likely to enjoy maximum market share as well.

2.12 Internal Advantages of the Packaging to the Company

Operations of a company are dependent on different methods of packaging that a company is using in its production and distribution cycle(Cliff, 2002). Operations are greatly affected with different forms of packaging in milk industry. Some of these measures make operations more productive and some reduce the productivity. To answer competition in the packaged milk industry, it is critical for the brands to understand the significance of ease in operations. Where choices are great in terms of milk products, the brands can highly distinguish themselves through the medium of offering convenience in operations. Continuous growth of packaging design for this purpose can very effectively counter competition for the brands(Giles, 2001). Where flexible packaging will aid easy handling of the product for both, the consumers and the retailers, it will continue to be the leading product preference.

Distribution efficiency is achieved if you have proper form of packaging available for the final product i.e. milk. It makes easier for transporters to supply it to different retailers and because of packaging, if there are any delays in distribution there is no harm for milk as it has extended shelf life. Retailers have a great edge in buying and storing packaged milk. They are more willing to store packaged milk with more shelf life. With this the objectives to fulfill the needs of retailers are achieved. It is very important to convince a retailer in this industry, because if he is not willing to put your product, it’s very difficult to reach to customers without retailers consent (Phillips and Bradshaw, 1993). The new forms of packaging, which are sometimes not just square or rectangle boxes are less machine friendly. New shapes and designs are made to persuade the customer but the disadvantage with them is that they reduce machine’s efficiency and production is reduced. It’s very easy to warehouse packaged milk cartons because of their longer shelf life and proper packaging. Although you can’t store unpackaged milk because of its form but on the other hand packaged milk can be stored without giving it a second thought. It only takes less space as the cartons could be organized in a proper manner

In the next chapter I will be explaining the methodology to conduct my research and then continue with final analysis and conclusion. The literature review has provided us with all the factors involved in packaging with respect to the marketing communications. We will be identifying the relations in practicality as explained by the literature review

Chapter 3: Methodology

3.1 Purpose of Study

The study focuses on the significance of packaging as a marketing strategy to counter increasing competition in reference to Pakistani packaged milk industry. The research identifies the impact of packaging as a means of communication for the dairy industry of Pakistan, and hence checking the buying behavior of the consumers because of different types of packaging i.e. labels, treatment, operations, benefits, quality, physical features, target market and margins. We want to see the impact of all these variables on buying behavior of the consumers of packaged milk industry in Pakistan.

Marketing is dependent on information which is already available within the organization but most of it is reliant on external sources (Ghauri and Gronhaug, 2005). Some of these data sources include market size, market share, information about competitors etc. This is the reason for which we conduct a market research to understand the market in an efficient way and find out how different strategies are successful or failures. It helps us reduce the doubt in decision making and help managers make decision based on the result of the research (Sinkovics et al, 2005).

“Marketing research is the function that links the consumer, customer, and public to the marketer through information – information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process.”

American Marketing Association (AMA) – Official Definition of Marketing Research

3.2 Research Design and Method Selection

The research design is a plan of how we are going to answer our research question (Saunders et al, 2007). It is based on the research questions to decide whether you employ qualitative or quantitative research methods or a combination of both of them. Sometimes, it is very difficult to define difference between quantitative and qualitative research (Silverman, 1993).

(Healey and Rawlinson, 1994) attempts to define the difference between qualitative and quantitative technique. They explain that quantitative methods is based on conclusions derived from numbers, data is standardized and results are in numbers and final analysis is conducted with help of statistics and diagrams. Whereas qualitative data is based on results expressed through words, it is a non standardized data required to be categorized and analysis is based on conceptualization.

(Easterby-Smith et al, 2002) explains the fact that research needs a partnership and it is always better to use both these methods rather than doing research on just one research method. Both of them have their own advantages and disadvantages. Quantitative research is better if large samples are available as it can analyze data on representative samples (Proctor, 2000). In this scenario, quantitative data is far more stronger as it can influence the reader with large scale, numeric data.

On the other hand qualitative research helps us look into people’s feelings and attitudes. It does not use set procedures as quantitative research to measure and define variables. It tends to focus on how we measure and define variables in everyday life (Silverman, 2000). One of the limitations of qualitative data is that reliability can be lost as the data is sometimes transcribed or tape recorded and cause in misinterpreting some trivial but crucial pauses and oberlaps (Silverman, 2000). Qualitative research is not as straight as quantitative research. It has its own turns, and it is the responsibility of the researcher to keep track of them.

(Guba and Lincoln, 1994) has explained that both quantitative and qualitative methods can be used for any research paradigm. In this research, there is a combination of both qualitative and quantitative research. (Tashakkori and Teddlie, 1998) has argued about the advantages of using mixed methodology i.e. quantitative and qualitative. The use of both the methods will complement each other and compensate for the weaknesses that each method has when being applied.

Quantitative research methods have been known for their advantages but are also criticized by some academics. It has been discussed by (Jick, 1979) that quantitative research is not efficient in understanding the setting or context in which people talk but on the other hand qualitative research makes up for such weaknesses. It is also believed that quantitative research is not efficient in taking the data of daily life activities but qualitative research helps the researcher understand the daily life patterns of the target population because of the personal interpretations made by the researcher.

(Churchill, 1995) explains that we cannot generalize the data in qualitative research when studying a large group of people because we can only study few of them. But in the case of quantitative research you can generalize your research as you study all the participants. In this way, quantitative research eliminates the weaknesses of qualitative research and both the methods complement each other.

We have conducted this research by analyzing both the type of data i.e. qualitative and quantitative. To conduct the qualitative data, we took interviews from the retailers selling the products. In quantitative analysis we have used two forms of primary research methods. We floated questionnaires and took interviews from the retailers. After collecting the data we used different statistical techniques to quantify the data.

3.3 Quantitative Research Method

Quantitative research methods has been used in this research to test the relationship of different variables used in marketing on buying behavior of the consumers in dairy industry of Pakistan. It has been argued by (Davies, 2007) that quantitative researches increase the probability that the information gathered is relevant to the questions asked and will be unbiased and reliable. It becomes very easy to quantify the variables if you are using quantitative techniques. The data collected through this procedure is in numbers and statistics and it is very easy and efficient to gather the data from the questionnaire.

The sample size consisted of 106 respondents from the middle and upper middle class. These respondents belong to every age group, profession and income bracket. They belonged to the urban areas of Pakistan. The method used to choose respondents was Non – Probability Sampling because we did not have access o every consumer that consumes milk. We collected the data from the questionnaires and quantified them in different statistical programs.

(Dillman, 2008) states that there are four types of variables that can be used in questionnaires to gather the data required for research. They include attitude, behavior, belief and attributes. The first variable i.e. attitude explains how the respondents feel about something. The questions on the behavior investigate what people did and experienced in the past. Belief variables explains the point of view of the consumers i.e. what they think is right and wrong. Finally, attributes contain the data about the characteristics of the respondents. It is very much important for the questionnaire design to take in account the data that needs to be collected and how to analyze it. The questions asked in the questionnaire should be clear and structure should be précised and defined before presenting it to the respondent for data collection.

A survey will be conducted to test the extent to which packaging and marketing communications affect the buying behavior of the consumers. A questionnaire will help us encoding the data for a better comparison but designing and floating the questionnaire is a time consuming job but questionnaires help you gather data from quite a lot of people and very quickly. If a questionnaire is perfectly designed, it can make interviewer’s job very easily and also improves the quality of the data being collected.

In this dissertation, the questionnaire has been designed, compiled and floated to test the importance of packaging on the buying behavior of the consumers of packaged milk products in Pakistan. The questionnaire focuses on the respondent’s behavior and attitude before making a purchase and post purchase behavior based on their experience of the product.

3.4 The Qualitative Research Method

The amount of data collected through qualitative research is huge. (Miles and Huberman, 1994:1) states that “qualitative data are more likely to lead to serendipitous finding and to new integrations and to new integrations; they help researchers get beyond initial conception and to generate or revise conceptual frameworks, words, especially organized into incidents or stories, have a concrete, vivid, meaningful flavors that often proves far more convincing to a reader”. The qualitative research takes in account individual feedback in detail which is ignored in the quantitative approach. It also provides with new information provided by the interviewee which we have not explored. In a questionnaire for quantitative research; the respondent only answers to the questions being asked. There is no new input coming from the respondent’s side. (Maynard et al., 2002) states that qualitative research is a better measure for measuring belief, attribute, behavior and attitude compared to quantitative research.

The sample size for this research was kept at 5 retailers selling the packaged milk. The retailers were selected from all parts covering all the demographic and psychographic factors of the consumers. There were small retailers from grocery shops were chosen as they have direct interaction with the consumers. We had a choice of selecting sales person from large supermarkets, but they would have less knowledge as they are not that much in contact with the consumers as compared to small retailers.

If we go on detail, there are numerous reason why qualitative should be chosen over quantitative research. Qualitative data is measured on meaning compared to measurements in quantitative research. It is an efficient way to gain sight into emotions, attitudes, feelings which are difficult to quantify (Strauss and Corbin, 1996). We can explore new insight into areas which are never explored before in the research. Qualitative research also takes in account the experiences people had and they can easily share it through this method, but quantitative data only talks about facts and numbers.

The interview is the most common way of gathering qualitative data. (Kaha and Cannell, 1957:149) has explained interviews as “a conversation with a purpose”. They are an effective way to gather large amount of data in lesser time. If there are more than one respondent for the interview, it will collect a wide range of information across many subjects. (Silverman, 2001) has explained that interviews are capable of getting deeper insight of inner-experiences, perceptions and emotions of the surrounding world. The qualitative research method has been regarded as the most common used technique for conducting systematic social enquiry. (Robson, 1993: 229) describes the advantage of interviews as “an flexible and adaptable way of finding things out”, which “offer the possibility of modifying one’s line of enquiry, following up interesting responses and investigating underlying motives in a way that postal and other self-administered questionnaires cannot”. The interviews make it easy for the interviewer to develop rapport with interviewees and they can collect data much easier from them (Miller and Dingwau, 1997).

The overall impact of mixed methodology helps the researcher to gain insight into all areas related with the field and provide with better information and data. It makes it easier for the researcher to gather data and analyze it. I hope the methodology used in this research would help me in the best way to analyze the data collected throughout the research.

3.5 Why selection of Pakistani consumers?

The population from Pakistan has been chosen based on the changing demographics of the consumers and the new trend of packaged milk being introduced by fast moving consumer goods companies in Pakistan. The use of packaging for marketing communications has been used by the western countries for quite a long time but it is a new concept in Pakistan.

The urban consumer in Pakistan is giving importance to new marketing communication activities used by the companies. There is a sense of understanding being developed in consumer’s mindsets for better products with reference to their marketing strategies.

Traditionally, Pakistanis have been buying milk from the milk man in raw form. They used to consume it after pasteurizing it at home. There are many UHT packaged milk brands now supplying in the market. The product being the same; many of them are focusing on packaging in their marketing communications mix as one of the important characteristics of it.

3.6 Reliability of Data

It is very important for the data collected to be reliable. The success or failure of a research project seriously depends on the quality of data collection. If the data collected is reliable, it further helps research to be consistent (Ghauri and Gronhaug, 2005).

(Nunnally and Bernstein, 1994) has defined reliability as something that if measurements are repeated by different people, the result should be same. It is also argued that reliable research results can sometimes lead to unreliable outcomes (Davis and Bremner, 2006). We should keep in mind that if the research has provided us with reliable data, it is tested according to its needs otherwise it can lead to false results.

It is believed that for data to be reliable it should result in repetitive results, but it can lead to different results if its qualitative data. (Saunders et al, 2003) mentions that findings of qualitative data can differ as they represent reality at the time of data collection and it can lead to affect the reliability of research findings. So reliability is one of very important aspects in data collection. It has been taken special care when collecting data for this research that it is reliable and can present true figures.

3.7 Data Analysis

The quantitative data was analyzed by putting it into SPSS. We conducted different tests such as, Cross tabs, frequencies and pie charts which helped us analyzing the impact of packaging used in marketing strategies of dairy industry of Pakistan. We also used cross tabs to relate the variables with respect to each other and checked their relationship. Frequencies were also used to check the percentage of respondents marking the most and least answers and checking the popularity and demand of different milk brands in the market.

For qualitative data there is no standardized approach to analyze it but as (Tesch, 1990) states the four main strategies of analyzing the qualitative data. They include:

1. Discovering Regularities
2. Understanding the characteristics of knowledge
3. Comprehending the meaning of text and action
4. Reflection

Qualitative analysis is done during collection of it and also after it has been collected. Once data is collected, it is then compared with other theoretical frameworks. It is very important for the researcher to distinguish if the available data has themes, relationships and patterns related to theory. It is then possible to give conclusions and recommendations (Saunders et al, 2007).

The qualitative data collected will be compared with the literature review and available theoretical frameworks used in literature review. The data will help us analyze how packaging as a factor for brands to counter increasing competition in the market. Any recommendations would be given on the basis of results from the analysis of this data.

Chapter 4: Results and Analysis

4.1 Limitations of Research

The very first constraint relates to my use of secondary data. While obtaining an overview of the local Pakistani dairy industry, I was unable to find the very recent and updated industry analysis. (Saunders et al, 2007) suggests that at times latest and up to date data is not available; in that case research should be conducted on the latest figures and data available The reports issued and available to me were not very current and dated to a few years back. In the highly competitive markets of today, statistics may change rapidly with the fast paced growing dairy industry. New entrants and new products may have entered the market in this period. With the available data being restricted to a few years back, entrants may already have introduced modern and innovative ideas explored in this research and may render a few points in my research as already experimented with.

(Churchill, 1995) states that it is very difficult to convince people taking out sometime for your research in their busy schedules. (Ghauri, 2005) emphasizes that benefits of research should be explained to the sample so they can relate how it can benefit them in the long run. The second constraint was faced with while conducting the primary research. I found many of the population unwilling to fill in the distributed questionnaire. Their accuracy may have varied when they filled in the questionnaires unwillingly. Moreover, many of the people from the sample were not the ones making the purchase decision. Their results may also not be very accurate.

(Proctor, 2000) explains that researcher can be bias conducting a qualitative research. A major part of this research is qualitative, it has been taken special care to avoid bias and evaluate purely on literature. But as mentioned by (Proctor, 2000) there is always a chance of bias involvement if qualitative research is done for the project.

4.2 Analysis: Interview with Retailers

(Healey and Rawlinson, 1994) suggests that interviews should be taken from people who are directly related with the research. The retailers were chosen from small grocery stores based on their interaction with the consumers. The sales person from large grocery was not included in the sample as they don’t have the same interaction level with the consumers. But small retailers, mostly the owners of the grocery stores were included as the sample for the interviews. There were 5 interviews taken from retailers covering different areas because of the demographic and psychographic factors involved in the research (Gretchen and Rossman, 2006). The appointments were taken from these retailers as suggested by (Silverman, 2004); so they had taken out time for the interview and they were not in a hurry. They were asked to fill out the consent forms for all the information being shared with them.

The topic was clearly explained to them before the interviews (Healey and Rawlinson, 1994) about the research of importance in packaging used in marketing communications by the companies in the dairy industry of Pakistan.

When asked about which brands retailers want to keep in their stores, the most preferred was Milk Pak followed by Olpers. They also keep Haleeb and Nurpur, but Milk Pak is preferrred because of increased sales per day. It is always important that a brand should give importance to the stakes of final seller (Deasy, 2000). They prefer to keep Milk Pak because the margins are same for every milk brand for every retailer and when there are excess sales of a brand, it helps the retailers to gain more. The reason they explain for choosing Milk Pak is its brand awareness with the consumers. “Milk Pak has created its brand identity through very good advertising, promotion and packaging”. (Muhammad Ilyas, Owner of a Grocery Store)

When asked about re-stocking of the milk. They explained that brands like Nestle and Olpers are delivered on daily basis and other brand are delivered twice or thrice in a week. (Prendergast et al, 1996) emphasize that packaging is should provide an aid to supply chain and storage rather a hindrance for consumers and reatailers. The reason for daily delivery is the lack of storage with retailers and large quantities of sales per day. They cannot store Milk Pak for a week, because due to large sales of milk they have to store large quantities of milk so they prefer it to be delivered on daily basis. “If the quality of packaging is good enough, we tend to stock specific brand more than others.” (Hamza Cheema, Grocery Store Owner). It explains that packaging has an extra edge on mindset of consumers as well as the retailers when keeping stocks of the packaged milk. Marketing strategies help the companies attract retailers which can help them in the long run (Philips and Bradshaw, 1993). But it was made clear by most of the retailers that margins are their motives and it does not matter to them which company is providing better packaging to its consumers. It proves as stated by (Underwood et al, 2001) that retailers are only concerned with their margins and benefits.

When asked about their preference for packaging, they were not really concerned about the packaging rather they were more concerned with large number of sales and their margins. When asked which brand they think has the best packaging, they replied it with Good Milk as it has gable top packaging which is user friendly for the consumers. (Calver, 2003) has also explained that user friendly packaging is always preferred by the consumers. “The gobble top packaging is an added advantage to the consumers.” (Mubbsher Zaman, Grocery Store Manager). Otherwise they thought all the packages are same as every milk brand has the same dimensions and is packaged by the same company. This proves the theory given by (Underwood, 2003) that all the products and packaging is identical for the salesman but each and every product has its own brand identity in consumer’s mind. There is no such difference for them to handle, carry and store different types of brands as all of them are packaged by the same company and has the same sizes. The same question was asked in the questionnaire from the consumers and they believed that every product has its own packaging attributes.

The best quality product for the shop keeper is the one which gives highest returns (Lindsay, 1999). When asked about their preference for user friendly packaging they were not really concerned as mentioned before also because of their interest in margins. They want to keep on their shelves what the consumers wants (Lindsay, 1999) and if consumers demand them any brand with user friendly packaging they would be more willing to keep it. But if a failed brand has a user friendly packaging but is not popular in consumer’s demands it is of no use to the retailers. “ User friendly packaging only helps the brand to attract the first purchase… After that it’s the quality of the brand which males it successful” (Adnan Qasim, Grocery Store Owner).

New marketing strategies adopted by brands are sometimes appreciated by shopkeepers, and sometimes they think it has seriously damaged the product’s brand value (Deasy, 2000). It is also contradicting between the shopkeepers, and there are different thoughts between them (Zeithaml, 1972). The response for introduction of plastic milk bottles was a little contradicting amongst the 5 retailers that we interviewed. It is a new concept used by companies to have better packaging in terms of plastic bottles. When the retailers were asked, some were in favor of the plastic milk bottles and some were not because of its high costs. Shopkeepers don’t have any emotional value attached with the brand and they associate everything with costs and revenues (Lindsay, 1997). One of the retailers also told us that Haleeb once introduced plastic milk bottles in the market and it was a success but then they stopped supplying it without giving any reasons. Sometimes the companies adopt new marketing techniques, but when they go out of budget; they stop these activities (Lindsay, 1997).

The companies were focusing on better looking labels and attractive packaging to attract the consumers but leak proof packaging was concern shown by the retailers. “Some brands in the market have very good looking packaging, but leakage ruins its look.” (Hamza Cheema, Grocery Store Owner). The brand should focus on its look, but quality of packaging should not be compromised (Nancarrow et al, 1998). Some of the brands have a leakage problem due to mishandling in supply chain. The transportation of packaged products plays a vital role, as it can cause damage to products (Prendergast and Pitt, 1996). Retailers were concerned and they think that leak proof packaging can really help retailers buying criteria if it is introduced. They were not quite interested in increasing the shelf life of the packaged milk. According to them, present brands have an expiry date of 2 – 2 ½ months which is sufficient to make a sale. They are not interested as the product is sold in maximum span of a week so increasing the shelf life will not change their buying behavior if it is introduced. It is argued by (Stewart, 1996) that packaging should maximize the freshness of the products.

When asked about introduction of single serve packaging, all of them stated that it has been provided already by treating 250 ml box as a single serve packaging. We rephrased or question adding the facility of opening the box or a bottle at the moment when the purchase is made and drink the milk using the packaging. The present 250 ml packaging is not user friendly to drink the milk on the street. It has been emphasized by (Lindsay, 1999) that fast moving consumer goods such as drinks, juices and milk should have a feature to utilize them straight after the purchase. Retailers also agreed with the idea and think that it could create a new market demand for packaged milk. Kids can play an important role when parents or elders are making a purchase with them (Phillips and Bradshaw, 1993). These retailers were also asked about special user friendly or attractive packaging for kids such as using cartoons or different characters. They were willing to keep it in their stores only if that attractive packaging is backed by a good brand name such as Nestle Superman, but if the attractive packaging is done by some new brand in the market, they are not willing to take risk e.g. Superman only. The value of a product is enhanced when a branded product is provided with good packaging attributes (Stewart, 1996).

Lately, there has been a lot of interest from the society towards the environment. People now understand the importance of environment friendly packaging. Environment friendly attitude has been seen by many companies in the last decade (Singhapakdi et al, 2001).

When asked about their preference for environment friendly and recyclable packaging, retailers advised that the present packaging provided by all the milk brands can be recycled and they are concerned with the environment and efficient use of resources. The marketing departments of these companies are portraying themselves as socially responsible on all the packages in the market. (Schlegelmilch, 1998) also believes that it should be communicated to the customer all the steps taken by the brand for the environment. Packaging is the best medium to communicate to customers about company policies towards the environment.

4.3 SPSS Analysis

The quantitative part of research was conducted by floating the questionnaires to the target market of the packaged milk brands. (Churchill, 1995) states that questionnaires are a true reflection of consumer minds and (Tashakkori and Teddie, 1998) they provide factual data to the researcher. The questionnaires were then put in SPSS and several tests were run to analyze the data. All the exhibits are provided at the end in the Appendix.

The first analysis exhibits the relationship between the preferred milk brands with their linked attributes for the buyer. The tables clearly indicate that the consumers make their purchase of packaged milk highly based on the brand name. This reflects their buying behavior and the importance for brands to effectively inculcate trust in the minds of their consumers. It verifies the theory given by (Fill, 2006) that choice of a product is dependent on its branding and packaging plays a significant role in building a brand. (Calver, 2007) states that packaging gives the first impression to the buyer, but if the quality of product is not good it will not be bought next time. The second purchase approach is clearly dependent on the product’s taste. Milk, being a health product, is preferred based on its closeness to milk’s original taste. Packaged milk may vary in taste owing to the various treatments it undergoes (Pakistan Dairy Development Company, 2006); however, the consumer preferences still support the brands closest in their taste with the original milk taste.

The factor next in line to affect the consumer’s purchase decision is the value for money. (Lindsay, 1997) explains that packaging of a product should aid product’s marketing but if it increases the cost of the product, it can lead to decreased sales for the product. This is not the main driving force in the purchase process and milk, a necessity commodity, is not affected greatly with slight rise or fall in its prices. However, a few consumers have chosen this factor to be of consideration while making their purchase. It is explained by (Broderick and Pickton, 2005) that mega marketing campaigns can sometimes result in heavy budgets and finally everything is dependent on the product sales

Attractive packaging, surprisingly, seems to play little role in convincing the consumers of brand quality. This may be due to two evident reasons- firstly, milk being a product of health has more important factors to be considered while purchasing than its packaging and secondly, the consumer market of Pakistan is not very developed and exposed to tremendous choice to have based their decision of packaged milk purchase on the element of attractive packing. (Calver, 2007) emphasized that packaging should be designed keeping in mind the target market for the product otherwise it could result in a total mess.

A user friendly package is always an added advantage to the product (Deasy, 2000). The next point brings us to the link between the preferences of consumers from various income brackets towards the idea of user-friendly packaging. One can notice that with the rise of income level, consumers are more demanding towards user-friendly packaging. This is because, as the income level rises, the consumers are more willing to pay a higher price for the element of convenience. However, this does not hold true for consumer from a lower income bracket. Value for money is of higher consideration amongst them than the factor of convenient packaging. (Lindsay, 1997) states that customer’s affordability should be kept in mind when designing a package, as some can spend for added feature but not every can spend extra for added features.

The next analysis boils down to the willingness of the consumers to pay higher for environmental friendly packaging. (Bone and Corey, 2000) explains that with global awareness consumers are much aware than ever before and they are concerned about the environment. Approximately 73% of the consumers are willing to pay a higher price for packaged milk if environmental friendly packaging is introduced. This indicates a shift in the trend and the preferences of the consumers. In the market environment where price, brand name and other factors dominate the consumer buying patterns, their preference towards environmental friendly packaging indicates a huge shift in trends. (Gray and Guthrie, 1990) explained that in the next few years environment friendly packaging would be one of the most important attributes in a packaging design.

About 86% of the consumers are willing to pay higher for highly treated packaging. This brings us back to their health conscious attitude where they prefer the quality of the milk product over any other factor. The consumers’ willingness to pay higher for a better product clearly highlights their demand for the originality of the product which will retain its benefits through the use of purposeful packaging. (Milton, 1991) explains that hygiene is one of top priorities for consumers as they cannot compromise on hygiene of the product.

The results show that 66% of the population is inclined towards the convenience aspect of packaging. In today’s fast paced life, convenience in packaging seems to be playing a vital role in influencing the consumer’s purchase pattern (Underwood et al, 2001). A high number of people are willing to pay additional to benefit from the technology of leak proof packaging. This indicates the high preference of the consumers towards easy to use and handle packaging. This trend persists due to a number of reasons: leak proof packaging reduced wastage, implying a better value for money. Moreover, it reduces the effort of other chores that might occur in the cleaning of spilt milk for which consumers are short of time and have a negative attitude. (Cliff, 2002) mentions that packaging should not only attract the consumers but it should also last till the product is fully consumed.

One of the important aspects that should be included when designing a pack is its ability to preserve the product for as long as possible (Milton,1991). More than half of the consumers, about 60% said that they would prefer milk with a higher shelf life. This is mainly because of their preference to buy in bulk. They prefer a longer shelf life as it would keep the product safe to use even after longer periods of time. For the consumers who make a purchase every now and then or as per required, a longer shelf life isn’t of importance for them as they consume it within the products lifetime. Currently, packaged milk retain a life of 2 to two-and-a-half months, which is already a sufficient time for a daily use product like milk.

72% of the population would like resaelable caps to be introduced in milk packaging. This again is a convenience aspect they would like added to the use of milk. Packaging should be designed keeping in mind different set of customers (Wansink, 1990). One notices that students are the ones who said they most preferred this type of packaging. This is because a lot of students residing in hostels drink milk in a casual manner. They prefer the idea of resealable caps as it suits their on-the-go lifestyle. The consumption of milk should not have to be a chore for them. They prefer consuming milk in a free manner which can be very much made possible with the concept of resealable caps.

(Czinkota and Ronkainen, 2007) explains that importance of children should not be ignored. They are one of decision makers when making a purchase with their parents or anyone in a family. Another interesting factor analyzed relates to the kids milk packaging. One notices that people are mostly neutral on this idea. This may be because this idea has not yet been exposed to the Pakistani consumers. However, one notices a greater acceptance of females about this idea than of males. This may be because of the increased sensitivity of women towards the needs of children. It has always been easier for brands to convince a child compared to mature consumers (Fill, 2006). They also may understand the child’s psyche better than men and also understand the elements that may attract their children towards the very essential consumption of milk.

As far as the single serve bottles are concerned, the response amongst both, men and women, isn’t very positive. The idea of consuming plain milk on the go isn’t the trend that persists in our local market. The consumers might be willing to accept this idea when the product is flavored milk; however, this idea of a single serve packaging was not found appealing amongst the consumers. Between men and women, the women population seemed more acceptable towards the idea and was more willing to experiment with this style of packaging. It has been explained by (Deasy, 2000) that brands tend to experiment on new ideas but is not essential it will work. A company always get to know when a new campaign has been launched in the market.

Chapter 5: Conclusion

The study revealed that packaging has a lot of impact in the growing competitive packaged milk industry of Pakistan. After doing an extensive research on the impact of competition in packaging we came to the conclusion that packaging plays a vital role in consumer buying behavior and decision making process. We conduced qualitative analysis and quantitative analysis and came to the conclusion that different aspects of packaging are very crucial and should be given attention by every company and brand that presently exist in the market. We came to the conclusion that features such as labels, treatment, operations, benefits, quality, physical features, target market and margins have a significant impact on the success or failure of any brand. Our quantitative analysis concluded that consumer buying behavior is a lot focused on user friendly and attractive packaging which is shown in the appendix.

We also came to know that packaging helps in establishing a brand and sometimes it is sub consciously affecting the brand and we are not aware of it. Packaging is one of the most efficient marketing activities that can be used in favor of brand building (Giles, 2001). We also found out that packaging is an extremely strong tool of advertising (Jefkins and Yadin, 3000) and it is one of the best forms for the companies to communicate with their consumers which use their products on daily basis. With an evolving industry competition packaging has become an essential element in branding (Calver, 2007) the product and changing the way people perceive about a brand.

We also came to the conclusion that Milk Pak is no doubt the market leader a present in the packaged milk industry. This has been proven by the questionnaires which were filled out by respondents from Pakistan and retailers as well and credit goes to branding of the company. Packaging innovations are being done by the market leaders as well as followers because of its increased role over the past few years (Leonard, 1996).

Corporate social responsibility has been gaining importance (Bone and Corey, 2000). Environment friendly packaging is also very much preferred by both consumer and retailer community as it is very much socially feasible for the environment of our country. User friendly packaging and single serve packaging is lacking a present in our local industry and it has a potential market.

Special treated milk such as Olwell and Skim milk has a large consumer market in the urban areas of the city but are not being preferred by the middle and lower middle class areas as they are being perceived milk for unhealthy people.

In a nut shell I would like to say that packaging is one of the most important features of packaged milk and it surely gives lot of advantages to consumers, retailers, distributors and the companies itself. Research and development should be done by each and every player in the market and they should keep on introducing new user friendly and attractive packaged products to the consumers of this country.