Innovation in the Global Market: from packaging to solution
That June afternoon, after watching the decisive match that took the Portuguese team through to the semi-finals of Euro 2004, Filipe de Botton once again reflected on Logoplaste’s future, recalling the path taken since the mid-1970s, when the company was founded. Despite the successes achieved, he could not rest on the company’s position as the European leader in providing integrated rigid plastic packaging services. The company’s history was undeniably associated with the practice of process innovation, and now
the time had come to keep this source of success alive once again.
Filipe recalled the company’s key turning points, namely its association with Procter&Gamble, the renowned global producer of fast-moving consumer goods responsible for successes such as Sunny Delight, with which Logoplaste had partnered from the very start of its market launch.
A breakthrough in the UK market
Launched in 1999, Sunny Delight quickly reached annual sales of £160 million, becoming a major commercial success, just behind well-known giants such as Coca-Cola and Pepsi. According to John Walsh, Sunny Delight’s brand manager, “this is a refreshing and unique drink, it contains fruit juice and is enriched with vitamins”. In Europe it is sold in France, Spain, Portugal and the United Kingdom.
“It was a phenomenon. It came out of nowhere and reached the position of the twelfth best product in grocery retail. Since our magazine has been monitoring this market, no other product has managed to match this”, says Jane Bainbridge, editor of the prestigious Marketing magazine, published in the United Kingdom.
The launch promotional campaign, estimated at around £10 million, met its objectives meticulously: it evoked a maternal appeal and, at the same time, hypnotised its younger target audience. Supermarkets saw their stocks run down far beyond what had been expected.
“My children put pressure on me. They saw the advert on television and wouldn’t stop asking me to buy it. They thought it was orange juice and wanted to take it to school, and I also thought it was like orange juice and just as healthy. That’s when I started buying it from the chilled displays in supermarkets”, admits Nina Sandler, a lawyer and mother of three, adding: “I was misled by the bottle format and by the product being placed next to the real 100% juices. Everything suggested it was freshly squeezed orange juice and not an artificial product.” This episode shows the importance of packaging to Procter&Gamble’s commercial strategy.
The success of Sunny Delight, or Sunny D as it later came to be known, was based on strong brand positioning, achieved through a strategy built on three pillars: intensive advertising, intentional placement on the chilled shelf, and consistent packaging, even though the product did not require such care, given the preservatives in its formulation. Like many other food products aimed at children, it also included additives that enabled characteristics related to flavour, texture and shelf life. This brand positioning enabled Procter & Gamble to capture a considerable premium on a product whose average selling price was substantially lower.
To implement this strategy—specifically, to obtain packaging that would embody the proper integration of the desired positioning attributes—the partnership established with Logoplaste was decisive. This Portuguese company already held a prominent position as a specialist producer of plastic packaging. However, Procter expected more from Logoplaste than it had typically offered its customers. The relationship that developed proved fundamental in changing Logoplaste’s business practices.
Thus, the commercial relationship paradigm evolved from a simple supplier and provider of services associated with the core business to a form of partnership, through the provision of a complete service, from packaging design to production and quality control. Logoplaste ceased to be a product company and took on a new purpose as a company that sells solutions. Moreover, it began to view its customers’ success as its own success, in addition to sharing the business risk.
