ROLE OF PACKAGING IN ONLINE WORLD

In the ever increasing competition of today s e-commerce market the need for effective
product promotion is crucial. In this environment the product packaging has come to play
a more important role as a brand communication vehicle.

This report focuses on packaging opportunities that may help to increase the customer
satisfaction and sales of the product. Packaging has a vital role to play in protecting the
product as it moves through the supply chain to the consumer.

Although the idea of this research was to distinguish the differences between physical
packaging for real shopping and virtual packaging for internet shopping.

The role of packaging is changing in an online world, and how it links to conventional
retail purchase behaviors is shifting. The greatest change is occurring at the post-purchase
stage of the online experience, challenging the conventional wisdom of creating a
consistent brand experience.

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It is generally accepted that the packaging of products is the medium between consumers
and products. The packaging of products is an effective tool for marketing in real shops
with Pilditch saying that packaging is the “silent salesman”.

The study identified that once the purchase is completed, the role of packaging changes
dramatically and its primary purpose is to protect the product during shipment. We have
identified the receipt of the shipping package to customers as a new moment of truth to
which marketers need to pay greater attention. On the most basic dimension, it is
ensuring that the shipping carton properly protects the goods during transportation.
However, on a greater dimension, it is an opportunity for organizations to convert this
functional need to one that provides a unique and own able experience that builds affinity
for the online service provider or
branded product.
For now, marketers can take great comfort in knowing that shoppers continue to rely on
packaging to make the right selection prior to and during the online purchase process.
The ability to leverage pre-established relationships with the brand via conventional retail
channels of distribution remains important factors in the selection process. Packaging
graphics are currently
the link of familiarity between the offline and online world. However, with the continued
growth of online sales, having a prior offline experience with the brand is becoming less
relevant
Never before has the role of the packaging of a product been more in focus, not only from
a sustainability perspective but also in terms of branding impact and as an integrated part
of the customer experience when buying and consuming the product.

The functionality and design of the future packaging for premium products will have
demands on applications and/or devices to protect against counterfeit and copying adding
new aspects to the concept of shelf impact. Another area of importance from a consumer
perspective is to guarantee that the package has not been opened and the content
tampered with, why we will see more of packages with tamperproof devices in the future.

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The growth of online sales?

Much has been written and researched regarding online sales. The hysteria of the ’90s
that predicted the downfall of conventional retailing has been replaced with fact-based
proof that retail is here to stay and prosper. The reality that came to light in the turn of
this century clearly identified that web commerce and retail sales would prosper together
as they both complemented the needs of shoppers on their quest for finding the best value
and selection. Today, online sales in India market grew by 88 percent in 2013 to USD
$16 billion. India’s Internet base, as of August 2013, was at 150 million users,
representing about 10 percent of the country’s total population.

Irrespective of online sales’ meteoric growth in the past ten years, it still only represents
four percent of total sales. Based on a 2010 U.S. Census online commerce report, this
growth was
predominantly generated from the sales of music, electronics, computer software,
books/magazines and clothing. You could argue that some of the growth is a natural
transition for the technology and service industries as they move to a digital world.

Others
Sports Memorabilia
Baby Supplies
Flowers
Toys/Dolls
Music
Videos/DVDs/Games
Event Tickets
Tours/Hotel Reservation
Airline ticket/reservation
Books
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Graph 1. The growth of online sales

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Consumer Packages Goods (CPG) growth of online

Not only have the sales of fashion, reading and electronic products shifted to a significant
portion of online sales, CPG companies have seen a growth of their products. In 2010
sales of consumer
package goods online grew to $12 billion or two percent of total online sales and are
anticipated to reach $16 billion by 2012, a 25 percent increase, outpacing total online
sales growth. Based on a Forrester and Barclays study, they anticipate growth rates of 10
to 14 percent for the key CPG categories of pets, food/beverage and personal care. This
growth has not gone unnoticed as companies such as P&G have seen their online
purchases now accounting for one percent of their total sales. This has driven the growth
of package good companies in creating online e-retailing platforms to capture this drive
for convenience, choice, and now with electronic
coupons, value.

The rise of digital has also greatly impacted shopping behavior with nine percent of U.S.
households currently buying CPG online and this number is anticipated to rise to 21
percent by 2020. Consumers who buy online tend to buy larger basket size ($80 online
versus $30 offline) and for CPG companies, it is a platform to build stronger brand
loyalty, establish a direct dialogue with their loyal customers and more importantly, help
shift the balance of power between retailers and manufacturers. For retailers, this shift
can be concerning as a recent Nielsen study identified that buyers are reducing offline
trips and stocking up online. CPG
manufacturers are provided a strong online presence through sites such as Alice which
allow a convenient and efficient way for consumers to shop from a wide range of
offerings. For most online websites, the use of packaging is fairly consistent, depicted by
the face panel with supporting copy identifying the product features/claims and retail
selling prices. In most instances, sites we audited featured the ability to magnify the hero
shot, making it easier for
shoppers to recognize specific packaging features and product claims.

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Getting in line with online shopping

The practice of purchasing products online has affected packaging-appearance, structure,

messaging and more. However, research and expert opinion reflects there still exists a
need for packaging companies to understand the differences-and those differences may
not be as broad as one might think.
Dale Doyle, creative director of brand/design consultancy firm Landor Associates, says
understanding how packaging and online consumer behavior interrelate is key, and it
presents a number of opportunities for brand owners.
"Online shopping is a huge behavior change for the consumer, and I believe we're still in
the infancy stage of figuring out how best to communicate the brands we develop to the
consumer via the Internet," he says. "We need to work harder to communicate our story,
not only on-pack, but the space around the package on the site."
In November 2011, brand/design consulting firm Shikatani Lacroix released "Packaging
in an online world," a white paper that examined how packaging influences consumer
behavior (and vice versa) as it relates to shopping via the web. Among the findings
related in the document:
• A number of factors can influence whether or not shoppers seriously consider or
purchase a product. Among the most important reasons: getting a view the actual product
packaging, knowing the product's packaging will protect it during shipping and knowing
the product packaging presented online communicates precisely what they'll be getting
when they open the container at home.
• Receiving the same packaging at home that one would find in a retail store is
more important in certain categories than others. When asked how important it was to
have the product arrive in the customer's home in the same packaging seen in the post
purchase, the CPG categories that ranked highest were pharmaceuticals (36.2 percent)
and groceries (35.8 percent).
• Shoppers often prefer that the packaging of products purchased online be the
same as it would be if they purchased the item in the store. The level of their preference
varies by category
Also, according to Jean-Pierre Lacroix, president of Shikatani Lacroix, purchasing
branded packed products indicates strengthened shopper loyalty. The research outlined in

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"Packaging in an online world" reflects that online shoppers are as much as 15 percent
more brand loyal than shoppers walking retail aisles.
"Online purchases have become ritualistic as consumers migrate from retail stores to
online experiences as they become familiar with brands, making it harder to switch
consumers once they have purchased a brand online," he says. "Packaging in both online
and retail share the need to scan a wide range of products and the need to connect in the
blink of the eye remains critical. Online shopping has the benefit of not having cluttered
shelves, giving each product greater differentiation. However, due to the resolution size,
online packaging messaging needs to be simpler as much of the mandatory copy is hard
to read online."
Doyle points out that the practice of shopping online is a different experience than retail
browsing for a number of key reasons. First, he points out, consumers typically will
connect with a product and brand for a longer span of time when sitting at home in front
of a computer than when standing in a store. Also, brands have the option of leaving off
all the legally required messaging that must appear on a pack sold in a store, leaving
more room and freedom for incorporating graphics and text that further enhance the
brand. Also, brand owners have more leeway to present the package graphically, as
opposed to how the retailer opts.
"The beauty of the online environment affords the opportunity to put the package in
context of a visual environment, as opposed to a cold, dull shelf, which helps with visual
appeal," Doyle says.
It is important to grasp that when it comes to understanding the relationship between
packaging and online shopping, conventional wisdom on consumer behavior can be off
the mark. In January, PricewaterhouseCoopers (PwC) released "Demystifying the online
shopper: 10 myths of multichannel retailing," a report that examines common
misunderstandings of consumer behaviors and trends. According to PwC principal Ron
Klein, one such misunderstanding is that online sales are sapping retail registers.
"There's a sense that online retail is cannibalizing retail sales," Klein says. "However,
data shows that customers connect with brands in stores, and they are often likely to
spend more money with that brand in that store."

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Klein pointed out retail shoppers still can interact with the products they're seeing on
shelves online. With smartphones and other digital devices, they can connect directly
with the brand, learn deeper information about a product, price the item and find about
offers-all while still in the store.
The 10 myths outlined in the PwC report are:
• Social media will become an indispensible retail channel.
• In the future, stores will be mere showrooms.
• Tablets will overtake PCs as preferred shopping devices.
• As the world gets smaller, global consumers will become more alike.
• Global online-only retailers like Amazon will always have an advantage over
domestic online-only companies.
• Online retail is cannibalizing sales in other channels.
• Low price is the main driver of customer spending at their favorite retailers.
Lacroix says that despite the changes that online shopping have created in consumer
behavior, the shift has not motivated CPGs to dramatically change their packaging
overall, adding that there are opportunites in that arena such firms could take advantage
of.
"CPG companies need to view online retailers such as Amazon as their own class of trade
more closely aligned to Cosco or Sam's Club where the product formats and basket sizes
are larger," he says. "This provides a great platform to offer multipacks that take
customers out of the market longer."
Lacroix points out that Amazon and other online retailers are offering branded
secondary/shipping packaging. However, Shikatani Lacroix research indicates that the
protective function of packaging in the shipping process tends to trump branding or other
more conventional package design merchandising principles.
As with retail shopping, online shopped packages take sustainability into account.
According to Doyle, the environmental friendliness of a product (tempered by cost) is
important.
"Sustainability will continue to be an important aspect of packaging, both online and in-
store for the near and far future," he says. "Cost plays a key role in how much companies
are willing to invest and still be profitable."

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Lacroix adds that while packaging companies and brands are seeing slimmed-down
packaging, including with online products, packaging won't be disappearing completely
anytime soon.
"We will always need packaging graphics to effectively communicate the products point
of difference," he says. "However, there will be a shift to the type of packaging structures
that consumers will accept once delivered to their homes. This shift will be driven by a
familiarity of what to expect once the product is delivered in addition to pressure by
municipalities to reduce landfill cost. Our research has shown that the physical package
primary purpose is protection followed by ensuring the product purchased online matches
the product delivered. This will drive a rethinking of secondary packaging."
Lacroix says packaging plays a larger role of influence in some categories than others.
For example, research indicates that when products are purchased as gifts (such as
perfume, gourmet chocolates or other items), consumer behavior indicated packaging
plays a more functional role.
Lauren Licata, interactive marketing specialist with branding and design firm
Kaleidoscope, says designing packaging that performs well online requires starting with
the right questions. "When a brand comes to us with a package design project, it's always
important to understand the environment where the product will be sold," she says. "In a
retail environment, for example, it's crucial that the package graphically communicates,
‘Who am I?' and, ‘Why am I right for you?' in order to encourage purchase at shelf. The
package structure, on the other hand, may need to provide protection or even act as a
delivery system."
Doyle says that customized and custom-look packaging can appeal to online shoppers.
His firm recently partnered with Stride, a Kraft Foods brand, on iD Gum, which features
strong, striking graphics.
"There are 18 unique illustrations over three different flavors that will shift as the brand
grows, keeping the brand engaging and fresh," he says. Such graphics present strongly
online, which can help convince Internet shoppers to buy.
Licata adds that graphics are important to online shoppers, but influence on consumer
behavior doesn't stop with a pretty package.

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"Many consumers consider online reviews, product descriptions, and product images and
may never actually see the package prior to purchase," she says. "While packaging
overall may become less important at purchase in an online shopping environment, it can
play a crucial role during shipping and consumer delight upon delivery."
Licata adds that structure of packaging is of high importance in the shipping, pointing out
that the graphics, marketing materials, overall presentation and sequence of
opening/unwrapping packaging upon receipt can play a role in impacting consumer
experience and reaction. As Lacroix pointed out, some retailers, such as handbag
manufacturer Coach or clothing purveyor Rue-La-La, use the outer shipping carton,
branded tissue and embossed receipt envelopes to enhance the brand and create a
premium experience through packaging.

9
 SECTOR INFORMATION

E-COMMERCE – A SUNRISE SECTOR

Introduction

What is that you do when you need to gift your parents or friends on their birthday or for
any festival? The majority of people today hop to the internet, browse through a few
websites that sell gift items like books, clothes, perfumes etc. and order one of them to
be dispatched to the person’s address. It takes just a few minutes at the maximum and a
click! Very few people today bother or even have the time to drive down in the heavy
traffic to some boutique and go through all the items there, hop on to a next one and so on
and finally select a gift and then go to the courier shop to parcel them off.

The growth of e-commerce industry has made lives easier for countless people. It’s not
just gifts but even everyday items like grocery and notebooks and pens that can be bought
online. Books, clothes, shoes, jewellery and accessories, travel tickets and hotel bookings
are some of the commonly purchased items online.

History of E-Commerce Sector

The rise of internet companies in India started in the mid-1990s. The first Indian internet
companies mainly featured online classifieds, matrimonial and job portals. The low
penetration of internet, lack of awareness and lack of development and confidence in
online payment systems were reasons for Indian internet companies not actively engaging
in e-commerce.

It was only in the mid-2000s, after the dot com bubble burst that e-commerce industry in
India started to take off. The first e-commerce services available were mainly offered in
the travel industry. With the proliferation of low cost carrier airlines, ticket offering
started to be made online. Even today travel booking websites hold a majority share of
the Indian e-commerce space.

10
A couple of years later, the online retail industry started taking shape and it is rapidly
growing today as brick and mortar stores are being replaced by click-only models or
brick cum click models of business.

E-commerce space relating to the deals and discounts websites started becoming popular
towards 2009 and onwards while the concept of social media for e-commerce is still
trying to make a foothold in the markets despite having one of the largest populations
using Facebook.

The Indian e-commerce markets offers services in B2B, B2C and C2C segments with
most of the players operating in the B2C segment.

Reasons for Growth of E-commerce Sector in India

The e-commerce sector in India started to grow rapidly from 2005-06 onwards. The
main factors for this rapid growth in the revenues and number of e-commerce companies
operating out of India was the growth of a young tech-savvy generation employed in IT
companies, rise in disposable income, changing lifestyles and easier access to banking
and internet facilities.

120000 107800
100000
77100
80000
55600
60000
40300
40000 28500
16600 21700
20000
0
2009 2010 2011 2012 2013 2014 2015

Total online consumer revenues (in crores)

Graph 2. Indian E-commerce Industry Growth

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Future Growth Prospects of Indian E-commerce Sector

According to a study, the Indian E-commerce sector is set to grow the fastest in the Asia-
Pacific region at a CAGR of 57% between 2012-2016.

Though currently having one of the smallest bases, e-commerce market in India is set to
grow by more than five-fold by 2016 as the number of online buyers and per capital
online spending is expected to increase rapidly. Reasons for this potential growth include:

• Increase in annual disposable income per household by two and half time by
2015. It is expected to grow at a CAGR of 5.1% during 2005 – 2025.

• Discretionary spending expected to rise to 61% in 2015 from 52% in 2005.

• Rise in the sales of PCs, tablets and smartphones as prices have declined.

• Increase in time spent online by an Indian. Average time spent by an Indian on the
internet is expected to increase to 21 hours per month in 2015 from the 17.4 hours spent
in 2011.

• Increase in the number of payment options. Number of online transactions is

expected to increase to 38 million by 2015, compared to 11 million in 2011. The number
of debit and credit card holders is expected to increase substantially to 350.4 million and
73.7 million respectively in 2014.

• Continuous reduction in the cost of internet.

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Challenges

• Lower average broadband speeds compared to other countries.

• High failure rate of online payment transactions.

• Lack of access to free internet facilities in public places like airports, trains etc.

• Lower margins for e-commerce companies could be a potential threat to their

survival.

Cash back guarantee, ability to give cash on delivery, fast delivery, great deals and access
to branded products are amongst the greatest motivators for people to shop online.
Hindrances to online shopping include inability to touch and try the goods before
purchase, fear of faulty products and fear of posting their personal and financial details
online.

Indian E-commerce Market Spilt

Almost 75% of the e-commerce space is controlled by travel websites but the online retail
segment (both consumer electronics and apparel and accessories) is also growing quickly.

Sales
Travel E- Tailing Financial Services Others Downloads

2%

6%
8%

8%

76%

Graph 3. Indian E-commerce market split

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Demographics of Indian E-Commerce Market

Contrary to the general perception that women are prolific shoppers, a study by Google
reveals that online shopping is dominated by men – 63% men vs. 37% women. This
could be due to the lack of financial independence and access to banking facilities like
credit/debit cards among a larger population of Indian women.

People of the age group 18 – 35 years are the largest purchasers of items online, with a
majority among them having access to their own financial resources. Internet is accessed
primarily from home or workplace but there is a growing number of people who access
internet from mobile devices also. Currently it is estimated that 30% of online shopping
queries come from mobile phones.

Google study also reveals that almost half of the internet shopping comes from outside
the top four metros with apparel and accessories being the hottest categories. The number
of repeat customers from tier 2 and tier 3 cities is also an encouraging sign for e-Tailers.

According to the study by Google, 30% of online buyers were drawn to Internet shopping
for discounts, 37% of users valued the convenience of shopping from home and 29%
appreciated the expanded variety of products available online compared with what is
available at brick-and-mortar stores.

Indian E-commerce players

The top 10 e-commerce websites in India as of April 2013 according to indiaranker.com

is:

1. eBay.in 6. Shopping.IndiaTimes.com

2. Flipkart.com 7. SnapDeal.com

3. Jabong.com 8. Infibeam.com

4. HomeShop18.com 9. Zovi.com

5. Tradus.in 10. Myntra.com

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An accurate picture of the market share of e-commerce website is difficult as most of
them are niche players in various segments like books, consumer electronics, apparel,
deals etc.

Flipkart is the leading Indian e-commerce website and developed its innovative payment
option of Cash on Delivery. This option has been a huge hit in India especially since
internet infrastructure is not yet well developed and the number of failed online card
transactions are higher. But Flipchart’s recent decision to restrict this service in some
parts of the country points to the risks the company has had to face with this kind of a
strategy and frauds involved. It is also facing logistics issues in many Tier 2 and Tier 3
cities.

Snapdeal is perhaps the most popular deals site in India for deals and group buying
HomeShop18 was India’s first 24-hour home shopping TV channel. Jabong and Myntra
are other online retailers growing fast.

Entry of amazon.in is going to increase the competition and the pressure to serve the
customers better and quicker in this industry.

Future of E-Commerce

The entry Amazon into Indian markets with its e-commerce website amazon.in has led to
a new chapter in the e-commerce industry in India. With direct FDI still not permitted,
Amazon has come up with an innovative business strategy to enter this sunrise sector in
India. It has brought together different online vendors on a single platform. This could be
a strategy that even bigger Indian players could use in the long run as the markets mature.

With the e-commerce space starting to mature, a consolidation is expected in the e-

commerce sector. A large number of smaller players who see smaller volume and sales
turnover might get absorbed by the bigger players or may be forced to shut down. With
profit margins being thin in this sector, many of the smaller firms might get bought up by
the larger ones.

15
SWOT Analysis

Most of the time we see that the use of electronic techniques for doing business add value
either by the reducing transaction cost or by creating some type of network effect, or by a
combination of both. In SWOT analysis (the acronym is short for Strengths, Weaknesses,
Opportunities and Threats), here we try to find out the strengths and weaknesses of
ecommerce in respect of Indian business environment. Then after we try to identifies
opportunities presented by that environment and the threats posed by that environment.
As shown in the following figure which shows the questions that an analyst would ask in
conducting a SWOT analysis

Strengths

 Global market: E-commerce biggest strength is the boundary less access in other
word no brick structure is mandatory to do business or no specific boundary is
required. It enables all the companies to expand them to global level. The
widening of geographic retail markets may facilitate the development of global
retailers
 Time saving: Transaction through internet is no doubt very fast. It saves time by
reducing physical movement.
 No time constraints: The concept of 25X7 shows that online trans can be used any
where any time as there is no time constraints.
 Price/Product comparison: Information and to choose are some of the right which
every consumer has. On the same footing ecommerce provide platform to
consumers to compare price and product effectively and efficiently. It will tend to
have far greater bargaining effectively and efficiently. It will tend to have far
greater bargaining power with suppliers than traditional local or national retailers.
 Cost effective: Elimination of long chain of middle man,decreasing need of
having brick infrastructure and outsource logistic are helping a small business to
stand at par with giants.

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  Flexible target market segmentation: The success of business depends on right
choice of segmentation . Target market segment here in e commerce is flexible
can be modified any time.
 Fast Exchange of information: “e” will always guarantee fast and accurate sharing
of information among merchants and customers and enables prompt quick just in
time reply.
 Faster buying procedure: The buying is just a click away from the seller. No
physical movement is required, no hunting of right product at right price is to
done by the consumer this make the buying process faster
 Niche Market: It is a concept of sub segmentation where the product of rare
species are available without putting some special efforts by consumer. Almost
everything can be sold on internet. Even if products targeted to smaller markets
the buyer will be somewhere on net.

Weaknesses

 Security: Security is a biggest challenge in to progress of e commerce. Customer

always found themselves insecure especially about the integrity of the payment
process.
 Fake websites: Many fake websites are available on net which promises better
service and secure dealing. These web sites can not only disgrace ecommerce but
also bring bad name to ecommerce.
 Fraud: Personal and financial details provided for trading purpose are misused by
hackers their personal undue interest.
 Fewer discounts and bargaining: Hardly online businesses offer discounts and
bargaining cannot be possible.
 Long delivery timing: The task of Delivery is usually outsourced, who do not care
about the timing of the seller. They provide their services as per their own
convenience. Some time the delivery time may extend to days or weeks which
one cannot wait for.
 Impossibility of physical examination : Products whose choice is merely depend
on its physical condition of the product with need personal touch before selection

17
 are not suitable fot e-commece business. As Online products cannot be touched,
wear or sit on the products.
 Limitation of products
Lack of personal services: Physical products can be available but lack in personal
services which are intangible.
 Limited exposure: In developing areas where internet is not accessible will have
no or little exposure to e commerce.
 Limited advertising: Limited advertising opportunities are available because in e
commerce one cannot go for mass advertising. The advertising is limited only to
computer literate person. And out of them only those who are comfortable with e-
commerce applications.
 Customer’s satisfaction: There is no physical and personal or direct face to face
interaction between customer and the seller. Therefore the scope of convincing
the customer does not exist.

Opportunities

 Changing trends: People are very brand conscious. They are interested in buying
branded stuff rater then local. If such stuff is available cross border they will not
mind it ordering through e-commerce. E- commerce is fast and effective even
financial transactions can be made from any part of the world. People of
tomorrow will feel more comfortable to buy products through internet only.
 Increasing number of user: Daily number of internet users is increasing. People
feel more comfortable to shop online.
 Regular Global expansion: E commerce can be operated any where any time
without any interruption. It always has a scope of expansion. All new population
and existing population who are not the user of e commerce are the target
expansion.
 High availability (24 hour and seven days a week): Along with each and every
click of the mouse business is in operation. Those who are busy in day time and
cannot spare time for them self, have all the opportunity to shop as per their
convenient time even during late night hours.

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 Advertising: Advertising is cost effective as compare to conventional offline
system.

Threats
 Competitors: Along with local competition, global competition also exists.
Competition is increasing day by day. Big companies have already entered in this
field. They are making people habitual at the cost of their companies.
 Changes in environment, law and regulations: Change in trends, fashion and fad
can distress E Commerce side by side change in law and regulations can also
affect it.
 Innovation: Customers now a days are always in a search of innovative products
and technique. Innovation will always work as an extra burden on the pocket of
consumer, be either in product, place, promotion and even price.
 Privacy concerns: Fears that information can be misused lead to spam e mail or
identity fraud.
 No direct interaction: In e commerce there is no direct interaction between
customer and the seller. There is no scope of bargaining. People prefer to buy
physically as compare to online to experience personal feel.
 Fraud: Persons using unfair means to operate ecommerce can damage the
confidence and faith of common people.
 Risk: Nature of fraud

19
 COMPANY INFORMATION

COMPANY PROFILE

Mirraw Online Services Private

Mirraw Online Services Private Limited is a Private Company incorporated on 12

September 2011. It is classified as Indian Non-Government Company and is registered at
Registrar of Companies, Mumbai. Its authorized share capital is Rs. 100,000 and its paid
up capital is Rs. 100,000.

Mirraw Online Services Private Limited's Annual General Meeting (AGM) was last held
on 24 September 2013 and as per records from Ministry of Corporate Affairs (MCA), its
balance sheet was last filed on 31 March 2013.

Mirraw Online Services Private Limited's Corporate Identification Number is (CIN)

U72300MH2011PTC221897 and its registration number is 221897. Its registered address
is 160, C.P. Tank Road, Mulji Niwas, 3rd Floor,Flat No. 6, Mumbai - 400004,
Maharashtra INDIA.

There are 2 directors of Mirraw Online Services Private Limited. Current status of
Mirraw Online Services Private Limited is - Active.

20
About Mirraw Online Services Private Limited

Mirraw puts designer and customer under one roof for online shopping. Know how to but
artificial , imitation jewellery online through mirraw.

Gone are the days when one had to go to the markets to buy something. Online shopping
has changed the world shops. The trend of online shopping is growing at a fast pace
majorly because of people confidence in its reliability as well as the comforts associated.
Moreover, the social integration of online shopping has also played quite a huge role in
its success. Mirraw is one such startup which uses the concept of social media for users
as well as for designers.

Mirraw is platform which puts designers and customers under one social roof. At Mirraw,
designer who want to indulge in social interaction can set up their fashion boutiques
online. Mirraw provides the designer a very intuitive interface to set up boutique and add
products and offers.

All other things are left to Mirraw; designers and artists can now just take a break and
focus on designing stuff while Mirraw will do the rest. Designers also have the freedom
to provide a small write up about their product which is published on the website along
with their product

Mirraw greets the customers with a very neatly managed market. The products are
categorized based on the type, designers, etc. Apparels are further classified by cloth
type. Customers can browse through all the products. Offers regarding all the products
are shown in a tab to the left.

The website also display the estimated delivery date of each and every product on the
product page and also provide chat support for customers. Above all, Mirraw has a 7 days
return policy along with 100% money back guarantee. They also provide 24×7 customer
support through either chat or phone,

One of the most important aspects of Mirraw is the way it gather information from
customers. It provides user games like This or That (http://www.mirraw.co m/play/tot) in
which user has to select out of the two products shown to him. The websites personalizes

21
the recommendations based on the choices made by the user in this game. Another such
game is Quiz (http://www.mirraw.com/play/quiz). In this game Mirraw poses you
questions like “Which product would suit your friend X?” In this way the website also
collects recommendations and alerts your friends. Another interesting feature is the Live
Feed. The Feed show all the new items that the designers have added right now.

Based on all these games and the favorites added by the user, Mirraw also send alerts to
the designers. These alerts help the designers to improve the products which are more
liked by the customers. Moreover, by providing worldwide delivery options, Mirraw
helps the designers widen the reach of their products.

So head on to Mirraw to explore the stuff made by a bunch of budding designers. Or else,
if you are a designer go ahead and get yourself a boutique on Mirraw. Its feature will help
you focus on designing, and give you an opportunity to widen your reach and showcase
your designs worldwide.

MISSION

 Bringing world's best designs to your doorsteps

 Help the designers build their brand online
 Encouraging upcoming designers

Vision and Inspiration

Mirraw intends to build a community centered around fashion, bringing together

designers and fashion lovers. A place where people can follow the latest trends in the
industry, and where new labels and brands are created. They count their success as how
well they are able to establish fashion brands online.

22
Market response and customers

Since their launch, the market has been responding quite well. The customer base is
females in the age group 20 to . There is a large chunk of male population (to impress
their better halves, love, or siblings, cousins, and friends) thronging Mirraw to buy
fashion jewellery. The user group is now in Tier 1 cities.

The bulk of fashion industry operates offline. But, considering the way technology and
social media tools can help designers spread awareness about their brand and reach out to
a global audience; and the growing popularity of online shopping – it’s time for the
fashion industry to go online. We hope Mirraw succeeds in giving the Fashion world the
much-needed digital push.

Products

Mirraw is a marketplace for all designer products and a place where people can follow
the latest trends in the industry, and where new fashion labels and brands can be created.

Mirraw bring you exquisite jewellery, Sarees & Salwar Kameez collections straight from
the fashion designers. Be it from the streets of Mumbai or the palaces of Jaipur, they have
it all.

Not only does the site help fashion lovers discover interesting pieces of designer
products, it also helps designers build a brand online.

SAREES: The most extensive section of the site is divided into four categories — Fabric,
Designer, Type and Bollywood sarees — making it very easy to look for what you want.
From viscose and tissue to jacquard and dupion, finding a saree according to its fabric is
a breeze here.

JEWELLERY: After sarees, the most exhaustive section on Mirraw is their jewellery,
which is further divided into three segments to make your browsing experience easier.
These three divisions are Category (earrings, bajuband, brooches and more), Designers
(such as Alankruthi and Magan Pearls) and Type (temple, thewa, kundan and more).

23
What we liked here was that brands from other parts of the country, which don’t have
much of an online presence, have also graced this site. Top examples of the same are
Runjhun Jewellery, Panjarat and others like them that you won’t find on other websites.

We presumed that the jewellery wouldn’t start anywhere below Rs 3,000, but were
astonished to see some pieces priced at as little as Rs 250. Don’t forget to check the
‘Other’ section under the segment ‘Category.’ You may just spot a piece that your
favourite actress sported in a movie. Currently you’ll find Deepika Padukone’s earrings
from the movie Ram-Leela up on the site.

SALWAR KAMEEZ: This section also has a lot of variety, but doesn’t come close to the
former two sections. Starting from `800 onwards, the collection is a lot less exciting, but
browse well and you may find some standout pieces. This segment also has a few outfits
worn by actresses. Semi-stitched salwar suits are also available, which is seldom found
online.

OTHER: This section consists of Bridal (sets, lehegas, sarees), Lehengas (ghagra-choli,
lehenga-choli, Bollywood lehengas), bags and other apparel such as tops, leggings and
dresses. The bridal sets are surprisingly not too expensive, starting from Rs 2,000.
Lehengas start from Rs 3,000 and bags from Rs 350. Don’t bother with the other apparel
section as it is subpar in comparison to the other items on the website.

24
Information of the Study

Although the idea of this research was to distinguish the differences between physical
packaging for real shopping and virtual packaging for internet shopping, it is necessary to
understand the functions of physical packaging in order to transfer packaging from real to
virtual.

This paper deals the conceptual knowledge of search engine marketing or e-commerce,
literature review, current and future aspects of e-commerce in Indian context. This paper
discussed about the top motivator factors of shopping online.

25
Literature review

Packaging was defined by the European Federation

Visser (E. Packaging on the web: An underused resource. Design Management Journal,
winter, 62-67(2002)). as “all products made of any materials of any nature to be used for
the containment, protection, delivery and presentation of goods, from raw materials to
processed goods”.
Visser also indicated that it is difficult to translate the existing packaging design and
marketing tactics into online retailing. In his research he also found that information and
emotional components could not be seen on retailer’s web sites.
Nowadays, people have many choices when they want to buy a particular product, being
able to choose from dozens of similar products. As a consequence, it is quite hard to
make a decision. So, the manufacturers have to meet the customer’s needs in order to sell
their products. In this circumstance, packaging could be a powerful tool in the marketing
for the sales of the product. However, during online shopping, consumers cannot touch
products, nor can they see packaging well in cyberspace. So how can consumers be
persuaded by online packaging?

The physical packaging of products has been studied for several decades and has been
comprehensively understood.
The basic requirements of physical packaging include: containment, protection,
preservation, communication, handling and storage, as well as
convenience of use . The various functions of packaging can be divided into three
categories; primary, secondary and tertiary functions The primary functions concern the
structural nature of packaging. The secondary functions relate to the issues of visual
communication, with the tertiary functions being about the
additional values for the product.

Kathman [Kathman K. Brand Identity Development in the New Economy. Design Issue,
18(1), 25-35(2002).] states that the internet is a “highly self-select environment”, with a

26
new packaging design strategy that must be different from traditional thinking for gaining
a greater market share of e-commerce. Visual communication has always been used and
can be tracked back thousands of years. For example, traditional Chinese characters were
transferred from their hieroglyph into words, all the words were drawn into a similar
shape as “the thing” that it looked like.

Kellner [Kellner D. Critical perspectives on visual imagery in media and cyberculture.

Journal of Visual Literacy, 22(1), 81-90(2002).] pointed out that visual images are very
important for our life as they can help us understand and interpret complex constructions
simply. The visual or nonverbal information can be composed by fragmentary evidence
for the construction of assumption and interpretation [Nielsen J. Visual communication
and interaction. Digital Creativity].

Fiske J. Introduction to communication studies, 2nd ed., Routledge, London, (1990)

A addresser has to use signs to convey messages, in order to communicate with an

addressee, so that when an addresser communicates to an addressee, then the addressee
can understand the message on a certain level (more or less accurately). The level of
understanding depends on the message. The more signs the addressee knows, the greater
capacity for communication they have

Cosio M, Dyson M. Identifying graphic conventions for genre definition in web sites.
Digital Creativity, (13)3, 165-181(2002)
Cosio and Dyson also stated that addressees used their previous experiences to explain
the phenomena when they were faced a new or different circumstance.

Packaging is a good agent for any product, not only because of the text descriptions but
also for its visual communication. It can effectively deliver incisive product information,
brand identity and is also a good cognitive agent for recognition. However, what would
happen if packaging was applied to e-commerce? Would it play as well on the screen as it
does on a shelf? For e-commerce, these questions are important as online packaging

27
presentation could increase not only the number of visitors but also the number of e-
commerce purchases.

Elaboration Likelihood Model

Consumers would not be persuaded by the packaging if it failed to convey a suitable
message. Therefore it is important to understand consumers’ psychology, which in itself
can allow designers to design a more effective packaging for their target consumers.

There are many researchers who have developed models of the dual process of
persuasion and influence on people. These models were recognised as the Hierarchy-of-
Effects Models (HEM). The first HEM was formulated by Lavidge and Steinger in 1961
[Lien NH. Elaboration Likelihood Model in Consumer Research: A Review. National
Science Council,
Taiwan, (11)4, 301-310(2001)]with two further models, the ELM by Richard Petty and
John Cacioppo and the other Heuristic Systematic Model by Shelly Chaiken [24] being
more widely used. However, the ELM is more frequently applied and cited in many
disciplines of research for both cognitive psychology and consumer research. Moreover,
it has obtained appreciable attention in research results and theoretical debates.
The ELM of persuasion is a model about how people get influenced when they receive
information. Petty and Cacioppo stated that there are two routes to process when people
receive information from a third party. The two routes are the central route and the
peripheral route. The central route is a method to process information, which means that
if a person had the ability and motive to process information he/she would more than
likely adopt this route. In contrast he/she would adopt the peripheral route. Additionally
the central route (known as high involvement) can be considered as a systematic method,
with the peripheral route (known as low involvement) being considered as a heuristic
method to the processing of information. Importantly, the ELM is used to measure the
effectiveness of commercial advertising. Much research has been conducted on this
theme From another angle, it seems that online packaging can be treated as an
advertisement for a product. Advertising campaigns sometimes link packaging and

28
advertising together, even though they both promote the product, reinforce the brand
image and attract the consumers’ attention. However some aspects allow us to recognize
subtle differences between them. Kotler, et al [34] indicated that there are more than
15000 items in an average supermarket with 53% of customers shopping impulsively,
packaging being one of the main factors in achieving this figure.

Reiner T, Rose D. Packaging design VS. conventional advertising, Austropack, July

(2002), accessed: 18/04/03
Reiner and Rose provides us with three points to distinguish the difference between
advertising and packaging
1) 70% of impulse shopping without remembering advertising but packaging.
2) A product’s packaging of a product advertises the product before and after purchase.
3) The packaging of a product has a longer shelf life than the life of the product’s
advertisement.

Visser also mentioned that packaging is not only the skin of a product to help to
communicate with the consumers but that it is also a mirror to reflect the soul of product.
Therefore the authors considered that online packaging should be able to do the same job
as it would do in the real shop environment, and even more importantly it is thought that
online packaging could not be replaced by online advertising. Although online packaging
has not been deeply studied, the above researches could offer good references for future
research.

29
BACKGROUND OF THE STUDY

In today’s world of growing online product purchase, the post-purchase brand experience
is a “critical moment of truth.” That’s according to a new study, “Packaging in an online
world,” conducted by Toronto, Canada-based branding and design firm Shikatani Lacroix
, which sought to understand how the development of online sales is impacting
packaging.

“The role of packaging in an online world, and how it links to conventional retail
purchase behaviors is shifting,” reads a white paper detailing the study results. “The
greatest change is occurring at the post-purchase stage of the online experience,
challenging the conventional wisdom of creating a consistent brand experience.”

The study identified that once the purchase is completed, the role of packaging changes
dramatically, and its primary purpose is to protect the product during shipment. “We have
identified the receipt of the shipping package to customers as a new moment of truth to
which marketers need to pay greater attention,” says the white paper. “On the most basic
dimension, it is ensuring that the shipping carton properly protects the goods during
transportation. However, on a greater dimension, it is an opportunity for organizations to
convert this functional need to one that provides a unique and ownable experience that
builds affinity for the online service provider or branded product.”

Among the strategic implications cited for post-purchase packaging are the following:

• Shipping package needs to ensure the product is not damaged during shipping, and it
needs to be made of recyclable material. Easy to open is an added bonus.

• Reduce primary packaging to save costs and consider packaging that supports the
premise that customers do not rely on graphics following the purchase process.

30
• Explore packaging approaches where there are strong linkages to the brand in ways that
are more meaningful and distinctive as part of the post-online moment of truth.

Problem Statement

With the explosive growth of online sales, how is this impacting the need for packaging
and does packaging need to evolve to effectively support branding initiatives that have
worked so well at the retail shelf level? This very question was the foundation for a
research study. We have seen other channels of distribution emerging over the years,
warranting their own style or type of packaging. From the big discount warehouse clubs
who demand oversized multi-packs to the convenience retail sector looking for products
that can be consumed in the car, marketers have met these challenges with unique
packaging.

With the rapid growth of online sales, do marketers need to rethink their packaging
strategies for this unique type of distribution channel? If so, what type of changes are
required that will ensure their brands remain relevant as part of the pre, during and post
purchase cycles. This white paper will present recent quantitative research findings
conducted by our firm. In addition, we will be sharing insights on consumer online
shopping behaviours and the role packaging needs to play to provide marketers and
brands with a sustainable advantage, namely:

 Why should we care about online?

 What are the branding requirements for online shoppers?

 What role does packaging fill as part of the online selection process?

 Guidelines and application approaches for marketers

31
Research Objectives

The objectives of the study were:

 To find out the effect of packaging on the buying behavior.

 Theoretical analysis of package elements and their impact on consumer‘s

purchase decision empirically reveal the elements having the ultimate effect on
consumer choice in a case of different products

 To check the effect of packaging elements on the buying behavior.

 To measure the relative impact of each packaging element on the consumer.

 To identify the elements which should be highlight while design the packaging

Limitation of the study

There is no definition within the related academia or packaging industry for “online
packaging”.
Therefore we propose the definition as following: online packaging is a concept relating
to
packaging of product presentation which transfers the functions of physical commercial
packaging, such as promotion, information and communication, to the virtual
environment, in
order to assist e-commerce sales.

32
Hypothesis

Hypothesis to be tested

Hypothesis H0 : Online “packaging” will have a positive effect on customers’ decisions

Alternate Hypothesis H1 : Online “packaging” will have no impact on customers’
decisions

33
Research Design

A Descriptive Research was undertaken which consisted of a questionnaire including few

questions to determine what factors influencing the online customers and if the packaging
affects the purchasing behavior.
The formidable problem that follows the task of designing the research project is known
as “research Design” design of a quantitative research study includes the method for
collecting the data. The sample design and construction of data collection method.
This study has a qualitative approach since it is deemed most suitable to the research
purpose as it is intended to study the phenomenon in depth to achieve a more complete
understanding of the research problem. The study also demanded detailed answers
regarding the respondents ‟ feelings, values and attitudes about issues involving how they
perceive a brand in comparisons to other competitive brands.

Sources of data

The data collected through primary data. The primary data has been collected by
conducting an online survey with structured questionnaires.
The aim of this study was to look at the research topic from a consumer perspective,
thereby gaining insight into consumer’s attitudes, perceptions, and opinions within the
subject area.

Data Collection Instrument

This include questionnaire which was prepared on surveymonkey.com. Questionnaires
has also mailed to the past customers of the company.

Sampling Technique and Sample

The population of the study is the customer who frequently do purchasing online or who
have ordered at least once in last 3 months.
Simple random sampling is used in order to generalize the findings in the particular
sector.

34
Women are big online shoppers

The study has a fair representation of the Men and Women shopping online. The recent
study identified that 12.5 percent of women are Internet users and made an online
purchase compared to 9.3 percent of men. What’s more surprising is the fact that women
made 61.1 percent of online purchases .Men dominates in the categories like electronics,
event and movie tickets and the more obvious, flowers. In all other categories, women
dominate the purchases. Women are also more likely to use social networking online, and
seem to be drawn to community, lifestyle and health websites. Internationally, women
spend more time on the web than men.

The most talked about category of products on social networks by women is beauty
products. After that food/restaurants and movies/entertainment are also popular,
especially amongst younger women. From Apparel to books to games, Women
dominates the online shopping compared to the Mens.

Chart Title
MALES FEMALES

Apparel,Accessories&Jewellery 44% 56%

Books,Music &CD 33% 67%
Electronics&Computing 38% 62%
Events & Movie Tickets 54% 46%
Flowers, Greeting & Gifts 56% 44%
Home & Living 51% 49%
Toys & Hobbies 39% 61%
Video Games and Consoles 44% 56%

Graph 4. Share of category :Males vs Females

35
Online pre, during and post shopping behavior insights

To gain a better understanding of the role of packaging in an online world, Age factor has
been added in the questionnaire to understand the various age groups of online customers.

Of the total number of respondents, 66.3 percent were women versus 33.7 percent men.
To
ensure we had fair representation of the various age groups, we set quotas for age group
segments, an equal split amongst the 50-plus, 30 to 49, and the 20 and younger segments.
The actual split within these segments is illustrated by the chart . Majority of the online
shoppers are of age group 40 to 49. Younger generation i.e. below 17 do only 11% of the
total shopping online shopping.

17 or younger 11%

18 to 20 18%

21 to 29 13%

30 to 39 17%

40 to 49 25%

50 to 59 8%

60 or older 11%

Graph 5. Age groups of online customers

36
Q1. Which of the following ranges best represents your total annual household income
before taxes?

Respondent profiles align with industry benchmarks

This questions has added in the questionnaire to understand the income of the online
customers. The study had a fair representation of the various income brackets with 20
percent consisting of annual household income before taxes of above Rs 500,000 , 30
percent between Rs 300,000 and Rs 500,000, 25 percent between Rs 100000 and Rs
300,000 and another 24 percent below Rs100,000.

5 Lakh + 20%

3 L to 5 L 30%

1 L to 3 L 25%

Under 1.5 24%

Graph 6. Annual household income of online customers

37
Q Which is your marital status?

This objective of adding this question in the questionnaire is to understand whether

marital status affects online shopping.We have observed that the maximum online
customers are married. More than fifty-six percent of respondents were married with the
second largest segment consisting of singles at thirty-five percent. The remaining
segments were either widowed, divorced or separated representing nine percent of the
sample size.

Marital Status

Never Married
35%

Married
56%

Widowed
2%
Divorced
Separated 6%
1%

Graph 7. Marital status of respondents

38
Q . Please mention your educational background?

From an educational standpoint, the majority of respondents had a post high school
education with very few having less than a high school diploma. It was interesting to note
that within our study, only 25 percent had a full time job with another 30 percent working
less than 40 hours per week. More than 30 percent were unemployed, either looking or
not looking for work. Finally the last segment consisted of retired respondents who
represented 10 percent of the total sample.

39
Q What is your online shopping spending percentage of total monthly spending?

Majority of respondents are heavy online purchasers and do most of the buying

Close to 70 percent of our total respondent sample fell in a group that did all or most of
the shopping for online purchase. This segment’s largest age group was people 21 to 29,
was better educated with 27 percent having a bachelor degree, higher income with the
largest total household income group consisting of the $50,000 to $74,999 range, and
predominantly women (71.2 percent do all of the household online shopping). This group
not only did most of the online shopping, but also spent the most as a percentage of their
total monthly spending with the largest group at 29 percent who spent between 11 percent
to 25 percent monthly. This group tends to outperform the total sample size but overall
ranking by purchase category remains consistent other than computer software and
hardware. It was also important to note that gift-giving was a very important portion of
online shopping needs with 28 percent of all respondents purchasing more than 25
percent of their total online purchases for this purpose.

Total respondents Do most of online shopping

Less than 5% 27.10%

20.70%

Between 6% to 10% 25.40%

25.40%

Between 11% to 25% 25.70%

29%

Between 26% and 50 % 13.70%

15.20%

Between 51% and 75% 6.20%

7.30%

Greater than 75% 1.90%

2.40%

Graph 8. Online shopping spending percentage of total monthly spending.

40
Q How important is it to see the actual packaging (graphics, brand name, format such as
box, bag, tube of the package) prior to the purchase as part of the online experience for
the following categories? Please only provide answers for the categories you have
purchased in the past three months.

Do most of online shopping Total Respondents

Sports Memorabilia 19% 16.30%

Alcohol drinks 13% 10%

Baby Supplies 31% 25.30%

Pharmaceticals 21% 18%

Hardware/Tools 23% 18%

Sporting Goods 29% 25%

Banking Services 30% 25%

Computer Software 45% 39%

Toys/Dolls 42% 35.90%

Music 54% 51%

Groceries 30% 26%

Videos/DVDs/Games 60% 56%

Computer Hardware 31% 39%

Graph 9. Percentages of the customers observe actual packaging of the product.

41
Overall buying experience meets expectations

Overall, the majority of online shoppers were happy with their experience with more than
90 percent indicating that the current experience either met or exceeded their
expectations.

When asked to indicate which part of the online purchase process required the most
improvement, 41 percent identified the experience prior to the online purchase, namely
the ability to do research, talk to friends and get information, required improving. In
reviewing the results, most respondents found the research part of the buying process
time consuming, and confusing with the ideal consisting of sites that allowed them to
review a wide range of products and prices. Another 33 percent cited that the experience
during the online purchase, namely the viewing and selecting of products, accessing
pricing, features, shipping and payment options had issues that needed to be resolved.

It was interesting that very few people identified the depiction of packaging as a major
issue. When asked to identify areas of opportunities, the following key points were listed:

• The total cost of the product, including shipping before the check-out

• Time consuming to gather all the research and find the product

• Hard to navigate websites

• Products were hard to see or information to read

• Shipping delays and tracking

• Return policies after buying

• Ability to price compare

42
Category Most Important Second Most Important
Sports Memorabilia Prior Experience Read Online ratings/
Review
Alcoholic Prior Experience Referred by friend / family
Baby Supplies Prior Experience Referred by friend / family
Computer Software Read Online ratings/ Prior Experience
Review
Toys/Dolls Read Online ratings/ Prior Experience
Review
Sporting Goods Prior Experience Read Online ratings/
Review
Music Prior Experience Referred by friend / family
Groceries Prior Experience Referred by friend / family
Videos/DVDs/Games Prior Experience Read Online ratings/
Review
Computer Hardware Prior Experience
Banking Services Prior Experience
Hardware/Tools Prior Experience Read Online ratings/
Review
Pharmaceuticals Prior Experience Read Online ratings/
Review
Others Prior Experience Read Online ratings/
Review

Chart 1. Overall buying experience meets expectations

43
Online shoppers rank the importance of the following factors as very important in making
the right purchase decision:

• Reading online ratings (35 percent)

• Have prior experience with the product/service (31 percent)

• Brand name (21 percent)

• Company website (19 percent)

• Read social media customer comments (16 percent)

• Referred by a friend or family (16 percent)

It was interesting to note that advertising through conventional mediums ranked very low
at 10 percent. In addition, what was concerning was the low reliance on sites that
included conventional offline retailing options, potentially representing an early indicator
of the shift away from traditional store shelves as the first moment of truth. When
respondents were asked to select the most important factor that allowed them to make the
right buying decision across the various categories, two were emphasized, namely the
prior experience the respondent had with the product or service, and the ability to read
online ratings and reviews. We believe the future link of conventional “brick and mortar”
in establishing a prior experience will be challenged with the growth of repeat purchases
of online products or services.

44
Q . What role does the packaging graphics and/or the packaging structure (box, bag,
bottle, etc.) play as part of your online selection process?

Role of packaging importance prior to purchase

The study represents the online shopping behaviours of consumers and uncovers
consumer insights on the role of packaging prior, during and after online purchases.
Respondents were asked what role does the packaging graphics or the packaging
structure play as part of their online selection process. While packaging graphics
currently serve as a link of recognition between the offline and online world, with 36
percent of respondents primarily using packaging to identify a product they saw in a
store, having a prior offline experience with a brand is becoming less relevant with the
continued growth of online sales. Respondents identified the following:

 the importance of the packaging protecting the product during shipping,

 reaffirmation that they were getting the product they purchased online,
 the ability to understand the usage or instructions as well as product features or
claims that were easy to find.
 The two most important factors were that the product they purchased online was
the right product delivered to the home, in the right condition.

Allows a 3D view of the product 19.60%

Protects the product during shipping 64.90%
Reinforces the brand name 20.70%
Helps me select between various… 32.00%
See what it would look like as a gift 22.80%
Ability to understand the usage or… 45.30%
Know what I am getting 60%
Recognize the product I saw in the… 36.10%
Product features or claims are easy… 40.80%
Ability to see the actual packaging… 26.70%

Graph 10. Role of packaging importance prior to purchase

45
 The role of packaging is viewed differently during CPG post purchasing

Consumers within the study who had purchased from conventional consumer packaged
goods categories such as baby supplies, groceries and pharmaceuticals represented more
than forty-seven percent of total respondents within the study. This group’s website usage
mirrors the behavior of the overall group in the ranking of types of sites. Specifically,
they expressed a preference with sites that allow them to select products from many
different online stores as their preferred choice. This consumer package goods group of
total online spends and most other factors did also mirror total respondents within the
sample.

However, where we noticed a significant change in behavior is when respondents were

asked the role of packaging as part of their online selection process. Online buyers of
baby supplies and especially groceries and pharmaceuticals ranked the role of packaging
significantly higher in the selection process, with the largest percentage shift consisting
of a 3D view of the product (25.5 percent versus 19.6 percent for all product categories),
ability to see the actual packaging (33.7 percent versus 26.7), and helps me select
between various options (45.2 percent versus 32 percent). The role of the packaging in
protecting the goods ranked the list with 60.90%. The majority of respondents, at 61
percent, believe the primary purpose of packaging is to protect the product during
shipping.

Allows a 3D view of the product 25.50%

Protects the product during shipping 60.90%
Reinforces the brand name 20.70%
Helps me select between various options 45.20%
Ability to understand the usage or… 45.30%
Know what I am getting 20%
Recognize the product I saw in the store 36.10%
Product features or claims are easy to find 22.00%
Ability to see the actual packaging graphics 33.70%

Graph 11. The role of packaging is viewed differently during CPG post purchasing

46
Q As part of your online selection process, besides absolute price and shipping policy,
please indicate which approach to depicting the product/service allowed you to make the
right decision?

Packaging remains an important element during the purchase process

The objective of this question is to understand the factors that affects the purchasing
behavious of online customers. Respondents are looking for the fastest and most
expedient way to grasp the information they require with more than fifty percent
selecting the simpler approaches to see the packaging. These are namely the packaging
photo of the main view with the appropriate price, and ability to view close-up images of
product features depicting all views. You could argue that customers go through a similar
offline and online product selection process, namely identifying the category, scanning
the range of offerings based on a set of criteria, narrowing the range to a select few
options and then gaining more information through side panel information, pricing and
product claims. Online customers compare the prices with the other websites as well as
the offline store. They prefer to buy the best goods at best prices.

Most websites that we visited and those mentioned by respondents as most frequented
mirrored a similar shopping structure to offline experiences. Approaches that had more
elaborate features such as a virtual tour of the product where customers can control the
view in addition to the price, and features or a video of the product being used, had very
little appeal amongst respondents. Such features affects the purchasing behavior of the
customers as they can have a clear view the product the intent to buy. Clear photos with
close up images is the main factor the majority of the online customer needs in their
buying stages.

As per the data collected, the main factor other than pricing and shipping policy is photo
of the product . Majority of the respondents with 61.2% prefer to have the clear photo of
the product. Majority of the respondents prefer the close-up images of the product. Only
upto 32.90% respondent is affected by product packaging and instruction.

From the study we have observed that the amount of time spent as part of the purchase
process as more than 53 percent of respondents spend less than ten minutes on the online

47
purchasing process. The need to review many products in a short period of time
reinforces the need to have a visual link of the packaging as part of this selection process.
Websites should allow for an easy search of products by category and use the package
image as the primary navigational vehicle, while featuring supporting information such as
price, coupons, features and testimonials as a second layer of the purchase decision
process.

This principle is supported as respondents rated the use of a photo of the main view with
appropriate price as the most important factor that allowed them to make the right choice
for each of the online product categories. Respondents were consistent with scoring
significantly higher for photos on alcoholic drinks, music, groceries and pharmaceuticals.
When reviewing a sub-segment of CPG shoppers, this group reflected a different
approach for baby supplies, computer software, computer hardware and hardware tools.
This group preferred a photo depicting all views with appropriate price and product
features. An underlining reason could be that these products potentially represented more
complex structural items.

Photo of the main view with pricing, features and

38.50%
testimonials

Ability to view close-up images of product features 50.70%

Video of the product being used 22.10%

Virtual tour where you can control the view plus price
27.50%
and product features

Photo depicting all views with the appropriate price and

49.90%
product features

Photo of the main view with the appropriate price 61.20%

Ability to view the product packaging, instructions and

32.90%
potential features

Graph 12. Packaging remains an important element during the purchase process

48
Q. What improvements you would expect from your online purchase other than price of
shipping

A higher degree of security, and the ability to price compare were important
improvements

When respondents were asked what improvements they would expect other than price of
shipping options, more than 53 percent cited more secure ways of paying and the ability
to price compare (44.2 percent). Other improvements that ranked high on the list were
easier navigation within the website, better image quality and quicker uploads. It was
interesting to note that irrespective of the growth of smart phones and their use for
browsing the web, only 17 percent identified this as an area of opportunity. Respondents
who had purchased CPG products tended to also rank the ability to price compare as a
significant area of improvement.

49
Q How important is it for you that the product that arrives in your home has the same
packaging that you would find if you had purchased the product in a store?

Packaging does not play a critical role in the post purchase online experience for
most categories

Although respondents ranked packaging as an important element prior and during the
online purchase, it was interesting to note that its importance dropped significantly in the
post purchase experience. We would have assumed that branded packaging would be a
constant link throughout the process. However, overall, the study identified that in most
instances, especially for music and software where the respondents can download these
online, packaging that arrived in the home did not play a critical role.

When asked how important it was to have the product arrive in the customer’s home in
the same packaging seen in the post purchase, the CPG categories which ranked higher
were pharmaceuticals (36.2 percent) and groceries (35.8 percent). When reviewing the
150 CGP results on the role of packaging, consumers wanted reassurance that the product
they purchased online was the same as the item being delivered.

Respondents also mentioned that packaging did not play a critical role since the purchase
was already completed and they had a high level of trust in the reputation of the online
company. Receiving the same package as the one viewed online was less critical while
ensuring the item arrived in a usable condition took greater importance. We also noted
that packaging did not play a strong role with customers who had a low requirement for
branded packaging or were repeat purchasers of the same product. The importance of the
package did increase if the consumer was giving the product as a gift. The study
identified items purchased online for gift giving had a higher importance level for
packaging with a significant percentage increase for the following: sports memorabilia
(42 percent versus 29 percent for non-gift-giving purposes), alcoholic drinks (33 percent

50
versus 22 percent), baby supplies (40 percent versus 27 percent), toys/dolls (47 percent
versus 33 percent), sporting goods (40 percent versus 26 percent), music (41 percent
versus 29 percent), and hardware tools (36 percent versus 24 percent). Marketers may
want to consider developing unique packaging for categories where the product has a
higher propensity of being sold as a gift.

Respondents did identify packaging as having a significant influence on the perception of

the quality of the product (52 percent), the quality of the manufacturer (40 percent) and
the quality of the organization/retailer (37 percent). However respondents rated the
overall packaging slightly lower on their perception of the overall online experience (37
percent).

Videos/DVDs/Games 38.60%

Groceries 35.80%

Computer software 33.90%

Toys/Dolls 32.60%

Computer Hardware 32.50%

Music 29.10%

Sports memorabillia 29.10%

Hardware/Tools 27.80%

Baby supplies 26.60%

Sporting goods 25.60%

Pharmaceuticals 24.40%

Alcoholic drinks 21.70%

Other 23.70%

Graph 13. Role of packaging in the post purchase online experience for most categories

51
Q How important is the overall design of the actual shipping container and how you
would rate the overall online shopping experience?

The shipping container is very important

Respondents were asked to rate their overall online experience based on a series of
shipping carton options. It was interesting to note respondents were focused on more
functional benefits of the shipping carton versus the solutions that focused on the image
of the package or reinforcement of the brand. Respondents identified the following as
very important to their online experience: ease of opening the container (34 percent),
shipping container is made of recyclable material (24 percent) and shipping container can
be reused for storage (18 percent). Branding on the shipping container had very little
appeal amongst respondents.

Vry Important Important

Shipping container is easy to open 33.60% 45.10%

Shipping container is made of recyclable material 24.10% 39.10%

Shipping container can be reused for storage 18.20% 37.20%

Shipping container features the retailer or brand

16.10% 30.30%
name

Shipping container is generic with no retailer

16.60% 24.50%
name or brand

Printed graphics that give premium look 14.60% 23.60%

Graph 14. How important the shipping container for respondents

52
The findings that we have gained in this study are as follows; the results of correlation
results of age shows that it indicated that there is a quite strong positive correlation
between age and attitude to on-line shopping, i.e. elderly people are not so keen to shop
on-line. This will help online retailers to make strategies according to different age
brackets. Education is also a factor that affects the customers to shop online. The results
showed that which is very high positive correlation between education and attitudes
towards online shopping and would indicate that higher education makes on-line
shopping more attractive.

The second part of the analysis is done on factors influencing consumers to shop online.
From the results we have concluded that the most influencing and attractive factor among
four factors is website design/features with close up images Convenience that is second
most influencing factor. Time saving and security is also important, particularly the
security concerns are very important while shopping online. Even today many offline
customers scared to enter the online market. One of the major reason for this is the
security of their payment. Packaging is also the main factor which affect the purchasing
behavious of the online customers. Online retail businesses that mail their products in
premium packages have a much better shot at boosting customer retention and increasing
online payments in the long run.

Although respondents ranked packaging as an important element prior and during the
online purchase, it was interesting to note that its importance dropped significantly in the
post purchase experience. It is important for a respondents that the product arrive in the
customer’s home in the same packaging seen in the post purchase . It gives a sense of the
security to them that the product they have received is genuine.

Packaging is also a main factor for the online customers and retailers because it protect
the goods from any harm. Proper packaging helps the retailers to safely deliver the goods
to the customers and it also increase the brand image of the company in the mind of the
customers. Customer expect that their product should deliver in the attractive and tough
packages with a brand name written on it. The study reveals that the package should be
easy to open and should be made of recyclable materials.

53
Usability

1. Feature the total cost as part of the upfront selection process when an item is being
selected, including shipping and delivery timelines versus offering this information at the
end of the process

2. Create a platform that allows visitors to not only review products but gain deeper
insights through reviews of the offering and price comparison with other similar brands,
leading to a reduction of the amount of time customers spend researching

3. Create a better delivery tracking system that is seamless between the online store and
the third party logistics company (Amazon was cited by many as having an issue in this
area)

4. Make more secure payment systems, such as PayPal, an option in the purchase process

5. Identify up front if an item is out of stock versus having the shopper go through an
entire buying process only to find out that the item is not available

6. Ensure the reviews are trustworthy and transparent as this is a growing concern
amongst respondents

7. Feature higher quality images of the packaging with the ability to enlarge the image
and read the support material and pricing, allowing customers to scan a range of offerings
quickly Consider aligning customers’ typical offline purchase decision behaviors with the
site’s content structure where the “brick and mortar” experience is their first contact with
the brand9. Expand product selection and research that can be made quickly, and increase
the ability to view a range of items easily

54
Packaging

1. Packaging continues to play a very important role in the online experience. The
importance for customers is heavily weighted as part of the pre research and purchase
stages of the online experience while for brand marketers, it is ensuring the brand retains
its visibility when the product arrives in the purchaser’s home.

2. Ensure consistency between the package customers see offline with the one being
presented online, as shoppers rely on the packaging graphics as a means of making a
product selection in an online environment

3. As online shoppers tend to represent a larger basket size versus offline purchases, it
will be important for brand marketers to reconsider their offerings to better reflect a
pantry loading strategy versus one driven by a higher purchase frequency

4. Package images need to have the ability to be enlarged on websites, and the quality
needs to be high-end, as the image of the package is a critical issue in the research and
online purchasing process

5.The online shopping experience must take into consideration the customer’s prior
experience with the product, such as the brand shelf presence (first moment of truth) and
in-home experience (second moment of truth), as they are the most important factors in
allowing them to make the right online purchase decision

6. Brand marketers need to review their post purchase brand experience as this is a
critical moment of truth:

• Shipping package needs to ensure the product is not damaged during shipping, needs to
be made of recyclable material, and easy to open is an added bonus

• Reduce primary packaging to save costs and consider packaging that supports the
premise that customers do not rely on graphics following the purchase process

55
In a conclude note of my research Iam confident to say that the study gave me the
opportunity to analyze various factors regarding the customer buying behavior. Results of
research on role of packaging on consumer’s buying behavior stipulated following
conclusions.

 Appropriate and vivid picture or packaging color which delivers them a happy
feeling, or an easy handle/open/dose/dispose package shape. All these elements
contribute each important effort to catch consumers’ attention and interest.
Besides each element’s single function, we think that a good combinatio n of those
elements may let the product more eye-catching and attractive.
 Empirically testing the research model proposed, package elements having the
ultimate effect on consumer choice in a case of different products from group of
convenience goods were determined
 The impact of package and its elements on consumer’s purchase decision can be
revealed by analyzing an importance of its separate elements for consumer’s
choice. For this purpose main package’s elements could be identified: graphic,
color, size, form, and material of packaging are considered, wrapper design,
printed information, innovation while product information, producer, country-of-
origin and brand are considered as important ones. Moreover, the impact of
package elements on consumers purchase decisions should be evaluated
depending on the consumer’s involvement level, time pressure or individual
characteristics of consumers.
According to my research, I found out that most consumers like the product quality after
they purchased their desired packaged products. Based on those facts, we can not say
there is a 100% equal relationship between good package and good product quality, but
there is a positive thinking and trend about well- designed package shows high product
quality. As a matter of fact, people are becoming more and more demanding; packaging
has been gradually shown his important role in a way to serving consumer by providing
information and delivering functions. With its different functionality to ease and to
communicate with consumers, there is no doubt about increasingly important role of

56
packaging as a strategic tool to attract consumers’ attention and their perception on the
product quality.

The role of packaging as part of an online world remains important as this channel of
distribution continues to gain a larger percentage of customers’ total purchases.
Marketers will need to effectively monitor how online shoppers’ needs are modifying
their reliance on branded packaging as part of their pre, during and post purchase
decisions. With consumers’ basket size being significantly larger than offline purchases,
it will be important to tailor the offering to this unique behavior.

57
E. Packaging on the web: An underused resource. Design Management Journal, winter,
62-67(2002)

Cosio M, Dyson M. Identifying graphic conventions for genre definition in web sites.
Digital Creativity, (13)3, 165-181(2002)

Reiner T, Rose D. Packaging design VS. conventional advertising, Austropack, July

(2002), accessed: 18/04/03

HM Customs and Excise, UK. What is e-commerce? (undated), access : 20/02/03

www.mirraw.com

http://en.wikipedia.org/wiki/Packaging_and_labeling

http://www.dotcomdist.com/packaging-survey-us-consumer-views-on-ecommerce-
packaging/

http://www.fedex.com/us/ecommerce/logistics.html

58
 Questionnaire

Dear Participants, I will be very thankful to you for this cooperation. The topic of this
questionnaire is Role of Packaging in Consumer Buying Behavior. Please provide
Information with confidence. Your information will not be disclosed.

Q1. Name

Q2. Male Female

Q3. Age

17 or younger
18 to 20
21 to 29
30 to 39
40 to 49
50 to 59
60 or older

Q4. Which of the following ranges best represents your total annual household income
before taxes?

Under 1.5

1 L to 3 L

3 L to 5 L

5L+

59
Q5. Which is your marital status?

Never Married

Widowed

Divorced

Separated

Married

Q6 . Please mention your educational background?

Q7. What is your online shopping spending percentage of total monthly spending?

Greater than 75%

Between 51% and 75%

Between 26% and 50 %

Between 11% to 25%

Between 6% to 10%

Less than 5%

Q8. How important is it to see the actual packaging (graphics, brand name, format such
as box, bag, tube of the package) prior to the purchase as part of the online experience
for the following categories? Please only provide answers for the categories you have
purchased in the past three months.

Computer Hardware
Videos/DVDs/Games
Groceries
Music
Toys/Dolls

60
Computer Software
Banking Services
Sporting Goods
Hardware/Tools
Pharmaceticals
Baby Supplies
Alcohol drinks
Sports Memorabilia

Q9 . What role does the packaging graphics and/or the packaging structure (box, bag,
bottle, etc.) play as part of your online selection process?

Ability to see the actual packaging

graphics

Product features or claims are easy

to find

Recognize the product I saw in the

store

Know what I am getting

Ability to understand the usage or

instructions

See what it would look like as a gift

Helps me select between various

options

Reinforces the brand name

Protects the product during

shipping

Allows a 3D view of the product

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Q10. As part of your online selection process, besides absolute price and shipping policy,
please indicate which approach to depicting the product/service allowed you to make the
right decision?

Ability to view the product packaging,

instructions and potential features

Photo of the main view with the

appropriate price

Photo depicting all views with the

appropriate price and product features

Virtual tour where you can control the

view plus price and product features

Video of the product being used

Ability to view close-up images of

product features

Photo of the main view with pricing,

features and testimonials

Q11. What improvements you would expect from your online purchase other than price of
shipping?

Q12. How important is it for you that the product you receive has the same packaging
that you would find if you had purchased from a retail store? Please mention the
categories.

Very Important
Important
Not Important

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Q 13. How important is the overall design of the actual shipping container ?

Very Important
Important
Not Important

Q14. Please rate the overall online shopping experience?

Printed graphics that give premium look

Shipping container is generic with no retailer

name or brand

Shipping container features the retailer or

brand name

Shipping container can be reused for storage

Shipping container is made of recyclable

material

Shipping container is easy to open

I am very thankful to all the participants for this cooperation. I hope all the information
that you put in the questionnaire will be according to your best expertise. Thank You

63