New packaging as an extension strategy

New packaging is one of the extension strategies: it means changing the container or wrapping of a product. It often goes with a rebranding, when a business updates how it looks so customers see it differently.

Why change the packaging?

New packaging can attract new customers. A fresh design may stand out on a shelf, and some shoppers may think the product itself is new or improved, so they try it. For example, a fictional business called Paws & Claws sells dog biscuits in a plain brown box. It moves to a resealable pouch with a hanging tab and a bold illustration of a dog. The pouch can hang on a shop hook, so it is easier to spot, and the resealable top may persuade owners that the biscuits will stay fresh.

It can also be cheaper to produce. If the new wrapper uses less material or is simpler to print, the business may spend less on every item, which can lower costs. Packaging that uses less plastic or paper can also be more environmentally friendly.

What can go wrong?

Existing customers may no longer recognise the product. If they walk past the shelf expecting the old box, they may not spot the new one and may buy a rival instead. The new design may also appeal less than the original, even if the business likes it.

Changing packaging can be expensive to design and produce. The business may pay for designers, test versions and new printing equipment, and those costs can be high compared with the extra sales the change brings.