Colour Effect on Brands

A few years ago, PepsiCo USA had launched a clear cola amidst much fanfare. (No, it was not the 7Up). After wasting several millions of dollars, the company withdrew the product before losing even more! The product bombed in the market because customers asked themselves: “How can a cola be colourless?”

PepsiCo lost yet another battle against the undisputed market leader Coke in the USA.

This disaster drives the point that the right colour is important for the success of any product. It does not matter whether your customer is a business or an individual. It is not uncommon for even a subtle change in colour to result in as much as a 20 per cent change in sales. This is something research has thrown up.

In the past, many manufacturers took a rather unscientific approach to choosing product colour, often following personal preferences or hunches regarding market demand. Or they may have relied on executives who were not colour experts to make colour palette recommendation. Increasingly, however, product colour is being viewed as an important aspect of total quality management (TQM). More than that, if you choose a wrong colour, you will end up having excessive stocks and resultant cash flow troubles.

In many industries, product and packaging colours are being more carefully scrutinised by companies who realise colour can give them a competitive edge. From appliances and phones to soaps and drinks this is true. Voltas was the first in India to bring colour to refrigerators. World has moved far from the days of first automobile. Remember what Ford used to say? “You can choose any colour as long as it is black!”

Product colours should be reviewed periodically because colour preferences change over time. These preferences are influenced by a variety of factors, including social changes, economic environment, fashion trends and regional influences. People unaware of these subtleties may find colour forecasting to be a tricky business. One of the big automakers forecasted a special green colour to become a hit for one year, but it was proved to be a bad decision in the wake of communal clashes. The company had to re-arrange their production schedules.

A number of factors are important when evaluating a colour palette. One clue that a change may be needed in a colour palette is the sales breakdown. If there are six colours in your palette, sales should be spread fairly evenly across them, with each accounting for about 15 per cent of sales. If there is a significant variation in sales from one colour to another, the palette probably needs to be revived.

Other factors to consider include the product’s end use, the marketing strategy, and the competition. For example, products to be used outdoors require a different colour palette from those intended for indoor use. For packaged food products, colour in fact makes or kills the product. For instance, blue is associated with poison and is a definite taboo in this industry. (The famous blue chocolate of Finland is an exception).

Products designed to convey a high-tech or contemporary image would require a different colour palette than the more-conventional products. The type of lighting and the environment the product will be used in also are factors. A comparison should be made for the colour forecast for that particular industry with the existing palette, paying special attention to current bestsellers. Often, a major change in colour offered is not required, but a subtle twist in colours (from beige to almond, for example) can make a world of difference. A better colour selection does not necessarily mean offering more colours although that seems to be the trend, going by the excessive use of colours these days by brands. Refining and enhancing the colour palette, while offering fewer colours, can have a significant increase on profitability because it can result in reduced production and supply chain costs along with increased sales.

The placement of colours in relation to each other on a colour card also is important. Colour placement can make it easier for customers to make colour selections, but it also can confuse them. Although colour trends vary from industry to industry, certain undercurrents are expected to be pervasive through the 90s. For example, a strong feeling to traditionalism and family values is expected to be the impetus for the resurgence of traditional colours.

Because of strides in technology, many new multiple colour finish will be seen. To some degree, consumer preferences and interior trends will be reflected in the purchases of business and industrial customers.

Brands that carefully create their colour palettes, tapping into the colour forecasting information available, will find that doing so can give them a distinct edge in a competitive market. They are the ones who recognise that the right colour effect is good for brands.

The writer spearheads execution and innovation for clients@CustomerLab