Second time in as past two years Pepsico had to withdraw its much advertised package redesign. While the Tropicana package design rollback last year was due to aesthetic reasons, the recent SunChips package rollback was due to misalignment in what is relevant to the customer and what the brand managers thought was relevant.
The SunChips packaging was a great innovation and fit very well with its Brand essence – being Green and Eco-Friendly. The chips are cooked with steam from solar energy. It was only a natural progression to take the Green to the bag itself. Instead of the regular and universal plastic bag, the new bags are made out of biodegradable plant material.
For the segment they are targeting, it is very relevant and I believe their customer research must have found a clear preference for the new bag and an improvement in brand perception of SunChips. Except in the market place it led to big outcry and big drop in sales, ultimately leading to Pepsi’s decision to rollback.
Chip eaters are griping about the loud crackling sounds the new bag makes. Some have compared it to a “revving motorcycle” and “glass breaking.” It is louder than “the cockpit of my jet,” said J. Scot Heathman, an Air Force pilot, in a video probing the issue that he posted on his blog under the headline “Potato Chip Technology That Destroys Your Hearing.”
Focus groups and carefully constructed surveys help identify stated preferences of customers. Test markets and in-store studies help identify revealed preferences on purchase decisions. While they meticulously measured customers’ stated and revealed preferences, they most likely did not follow the customer in their natural habitat where they ate their bag of chips. Only observing them in real world using the product will help identify ”What job the customer is hiring the product for?”
Green credentials are great and the desire to snack eco-responsibly is there, but when they had to pick between snacking discretely vs. being Green, the former turned out to be more important. While PepsiCo tried to position the new bag as more Green, customers were hiring the product as a snack that they don’t have to be embarrassed about.
This is also a caution for those looking at studies that find customers are willing to pay price premium for Green. Those studies are based on stated preference and not based on actual customer behavior.
What is relevant to your customers? What job are they hiring your product for?