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The importance of color at Costco.


We are often asked by our customers "What colors are most effective at Costco in driving sales?"


Since the Costco Packaging Guys help brands not only design the structure of a Costco pallet display but, the execution of graphics, we love this discussion.


Let's unpack this question in a few steps

  • Psychology of color and your brand

  • Lighting at Costco

  • Competition with other brands

  • Color blocking

  • How Kirkland Signature breaks from the norm


Psychology of color

Since the late 1700's color has been studied for its influence on everything from human character traits to buying decisions.


The chart below from Wikipedia gives examples of how different colors are perceived by customers.


These colors are great for a splash of eye catching color, highlighting a bundle or bold value statement.


For established brands with a consistent color palette, let brand colors drive the graphics. Don't recreate a color pallet only for Costco.


For example, customers expect to see Duracell, Palmolive, Colgate in their distinctive, powerful colors and it's incredibly effective.


Conclusion: Use colors that stay on brand.

Lighting at Costco

As we have talked about in previous blogs, Costco lighting is a mix between LED and natural light diffused through sky lights. In general lighting is darker (especially in aisles) and more inconsistent than most retailers since it changes across the warehouse and from day to night.


Conclusion: Keep graphics bold and easy to read.


Competition with other brands

Some brands want to focus on colors which will differentiate them from their competition. In many cases your brand will be the only product of its type and your pallet location may change regularly at each warehouse. Focus on what's best for you brand and don't be overly concerned with the competition.

Conclusion: Don't worry about other brands.

Color blocking

Color blocking with on-brand colors with a clear product value statement on both the primary and pallet displays the goal.


Well done:

Google stays on brand while understating brand and highlighting product.












Room for improvement:

Beats has an amazing brand and loyal customer base.


The splash of different colors may be eye catching but, it doesn't appear to be on brand and may be easy to miss that it's a Beats product.



Room for improvement:

Canon is on brand with red, white and black.


The trays only communicate "Canon" and are only 1 color, lower quality flexo printing. Canon makes so many products. If a customer is looking for ink, the could easily miss this product.


Conclusion: Focus on color blocking on both the product and tray packaging.

Kirkland Signature






Kirkland Signature (KS) brand saw $58 billion in sales during the fiscal year 2021. It's not surprise that Costco usually gets its KS brand packaging right.


As a quick history lesson, before Costco, no other in-house brand was successful having simply 1 brand. Costco in its never ending quest to break all the rules in their favor, figured out that having 1 brand made things so much easier domestically and internationally. Simply create 1 brand, trademark it globally and you are done.


Although this seems the obvious way to go, before Kirkland Signature (KS), no one ever thought it would be possible for an in-house brand to put on name on everything from golf balls to vitamins. One way Costco pulled this off with such a wide range of products was to allow different products to use a color palette independently of each other.


Although the KS logo is on each package in a relatively consistent location, the look/feel changes based on the product. Note that the colors are most often transitioned from the product to the trays so they work together as a system.


Here's some examples:


Giving each product color flexibility allows Costco to avoid having each product look like the an ubiquitous "generic" brand with the same graphics on every pallet display.


In a related pro tip: Note how KS does such as great job at highlighting "Product over Brand" on primary and tray packaging.


Conclusion: Kirkland Signature breaks the on-brand rules for color but, it works.

In summary:

There are many nuances in deciding graphics on primary and pallet displays. This is always great discussion and there is plenty to explore.


Do not miss an opportunity to create a splash of on-brand color on your primary product packaging or tray packaging to promote your product.





If you've ever seen a pallet display with missing graphics on layer trays...


A simple value statement here goes a long way.










You quickly understand how much of a missed opportunity it is compared to when it's done right.

(btw: look at that structural stability at 6 layers high....love it!)



The Costco Packaging Guys strategy is to work on graphics and structure in parallel. This will ensure the best possible pallet display to drive your sales.


Until next time.

Cheers!


TCPG

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