Distinct pricing, clear hierarchy, product connection, and thoughtful planning are crucial for consumer engagement and vertical growth.
Proper tiering plays a powerful role in alcohol beverage branding. Designing the packaging appropriately for each price point, product type and quality level is crucial in order to avoid confusion amongst the various tiers. A properly designed system will help attract consumers seeking products at particular price points and provide a strong family look for your brand portfolio. If designed improperly, products in a tiered system may inadvertently cannibalize one another’s sales by appearing too similar in quality or price, or worse, be so disjointed that brand recognition is not achieved.
Proper tiering provides clarity for the consumer.
For example, entry-level products are often targeted to consumers uncertain about what product or brand they should choose. Entry-level packaging should be designed to be eye-catching and inviting to the consumer, and should reinforce the product’s quality without overpromising.
Mid-level offerings are often the “workhorse” of a portfolio and should be designed with a strong value proposition in relation to the competition. Often, packaging at this level is designed to appear visually more expensive than the actual price point in order to avoid discounting and to build in an intrinsic value proposition by making it more expensive looking than its price.
Top tier offerings need to set themselves apart as true luxury products, more limited and of superior quality. Here, the appearance of scarcity and something truly unique is paramount to supporting a larger price tag. Often consumers seeking more premium or icon brands are a more experienced connoisseur that will be looking for certain luxury cues and information on the package that communicates items such as specific production methods, sourcing, limited production, etc.
The proper tiering your brand’s offerings will allow consumers to access your brand at the tier that fits their comfort zone, leading to greater repurchase rates and brand loyalty. Then, as your consumers become more sophisticated or when they are ready to splurge for a special occasion, they are more likely to purchase within your brand; a brand they already know and trust.
3 Mistakes to Avoid with Tiering
- Failing to plan ahead.
Think long-term; how do you envision your brand growing? In the future do you foresee adding SKUs such as flavor extensions, an aged product that is in barrel now, or a more affordable or premium tier?
Even if you’re unsure of your future plans, be careful not to pigeonhole yourself with a branding solution that is not flexible and easily extendable. Although no packaging design will last forever, the last thing you want to do is to be forced to re-design your brand simply to accommodate portfolio growth.
- Failing to clearly differentiate between tiers
Be sure to create significant differentiation between tiers, leveraging both pricing strategy and package design.
Your package designs should not only clearly differentiate between your tiers but also use the appropriate cues for their respective price points. Be sure that while differentiated, each tier still leverages your brand family’s key equity elements so that there is clear brand recognition across your spectrum of offerings.
When brand tiering is done correctly, consumers should be able to easily ascertain each tier: good, better and best simply by looking at your packaging.
- Failing to connect your tiers to your master brand.
One of the worst scenarios can occur when differentiation between tiers is too extreme and consumers do not connect your SKUs or tiers together as one brand. Proprietary names, unique sourcing, limited offerings, etc. all have a place, but if done to an extreme, consumers won’t recognize your various offerings as one brand and you’ll miss the opportunity for vertical brand loyalty.
Depending on the number of tiers you have, the connection to the umbrella brand may be bold or rather subtle, but there should never be a doubt as to the overarching master brand, unless there is a specific desire to have a SKU stand apart as its own brand.