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Australia has one of the most concentrated grocery sectors in the world, with two major grocery chains, Woolworths and Coles, controlling about 80% market share of an industry valued at A$111 billion. The top five supermarkets in the US control about 33% of the market. The top five in the UK control 50%.

The big spenders - Unilever, Procter & Gamble, Mondelez...are having to work hard to create growth globally. Unilever’s global growth, for example – 3.6% sales, 1.6% volume versus a 6.4% decrease in turnover in first quarter 2014  – is being driven by growth in Australia and emerging markets. The company increased its advertising and promotional spend 50bps to €460m (AU$647m) globally last year to achieve this.

FMCG is tough in developed markets. And companies are having to alter traditional ways of doing business to conquer new challenges that a changing world is plonking in their paths. Unilever has been at the spearhead of corporate social responsibility in FMCG since its Sustainable Living Plan launched in 2010. At the end of 2013, it announced that it would cut around 800 marketing jobs globally, equivalent to 12% of its marketing headcount to help it make US$500m in savings across the business. It has a new marketing head and has launched the Unilever Foundry to snare start-up thinkers to meet its challenges in proactive ways.

With all of this as a background, PKN asked Kath McLachlan, executive creative director of Australian design group, Saltmine, about being at the pointy end of FMCG – creating the lures that make people pick an item off the shelf or leave it there. 

PKN: How much and in what ways do new packaging technologies shape your design ideas?

Kath McLachlan: More often than not packaging formats and technologies are dictated by our clients, so our design ideas are inspired by the packaging type we’re given to work with, rather than taking design inspiration from a range of different packaging technologies ourselves.

My career started in pre-press so I’ve always been interested in keeping up to date with packaging and printing technologies and how capabilities have changed over time. As a creative, I find change inspiring and it’s important to keep on top of innovations.

PKN: To what extent and in what ways are sustainability considerations changing your designs?

KMcL: In our business, most decisions towards sustainable packaging are client-driven.  They make the decisions to invest in new technologies and then brief us to design a visual identity for their packaging, whether it be sustainable or otherwise. To date, we haven’t seen much innovation towards sustainability within our mainstream FMCG clients that affects the design itself. The packaging materials may change to a more sustainable material type but this doesn’t substantially change our designs.

PKN: Supermarkets in Australia are changing. How is this affecting your branding and design thinking for FMCG?

KMcL: For FMCG goods, the importance of communicating your brand story has become more important than ever before. There are so many new “me too” copycat brands and a plethora of home brand labels to compete against so a solid visual identity is mandatory to stand out from the crowd.

Satlmine embraces ‘ideas driven design’ to help a brand cut through from the competition on shelf. This is design that uses a big idea to create an emotional connection between the packaging and the shopper. In an environment where there is so much ‘noise’ and so little time, it’s paramount to capture each shopper’s emotions and attention in a few short seconds. 

PKN: A large part of your work is finessing existing design. What are the challenges in finessing existing design? When do you think a brand should reinvent or revamp itself?

KMcL: Finessing an existing design is often a challenge because it’s usually a client-driven exercise, and while the reasons for their prescriptive design changes are usually valid, they don’t always come together visually. It’s a bit like trying to do a puzzle without all the right pieces - it’s a lot harder to make it look good than starting from scratch, looking at the project on a more holistic level.

A brand needs to reinvent itself when it’s in danger of becoming staid and irrelevant to the target market. When the target market grows up and the brand is in danger of being left behind or it no longer succeeds to differentiate itself from the competition a brand should consider re-imagining itself.

PKN: The ultimate client-designer relationship. How do you see it?

KMcL: Saltmine takes a collaborative approach to each brief, in fact, ‘Collaboration’ is one of our core values. This means that our creative team works together with our client and our client service team in a collaborative approach. We recognise that the sum of all our talents is much greater than working in silos, so by collaborating with the client we achieve more as we are working toward a common goal.

Overall, it’s important for our clients to trust us and that there’s honest two-way feedback in place.

Food & Drink Business

Entries are now open for the annual Melbourne Royal Australian Food Awards. Open to commercial food producers of all sizes, it is one of the largest programs of its kind. 

Victorian brewery, Bodriggy Brewing Co, is the first brewery in the state to achieve carbon-neutral certification and only the second in Australia to do so. The independent Abbotsford-based brewery achieved certification under the federal government’s Climate Active program.

According to Rabobank data, Australian consumers are facing higher chocolate prices heading into Easter, with retail chocolate prices up 8.8 per cent on the previous year as global cocoa prices soar.