CASE STUDY: Mindo Chocolate Packaging
This project takes an in–depth look at sustainable packaging solutions for Mindo Chocolate Makers. Mindo has strong ethical practices and supports sustainable principals but their current packaging does not represent the company’s philosophies. For this project I reviewed artisan chocolate making, explored the competition and market, looked at potential materials and processes, explored the supply chain of those ideas and finally outlined a solution that encompasses all the data collected.
The primary purpose of this project is to provide Mindo with design solutions to create an affordable, sustainable package that is environmentally friendly, upholds the company’s ideals, and enhances the brand.[tabs tab1=”COMPETITIVE ENVIRONMENT” tab2=”MARKET SEGMENTS” tab3=”MATERIALS & PROCESSES” tab4=”SOLUTION” tab5=”SUPPLY CHAIN REVIEW”]
Mindo Chocolate is positioning itself as an artisan, bean to bar, chocolate maker. This is a very specialized niche market in which the competition are small chocolate makers whose focus is the origin and flavor of the bean and the process itself. They produce their product in small batches with limited commercial equipment. They perform all of the chocolate making processes by hand, including the packaging.
On the Shelf
Being a niche market, artisan chocolate is primarily available in urban specialty and unique retail environments (coffee houses, food retail spaces, specialty chocolate stores, farmers markets, food co-ops). Mindo is currently distributed locally within Michigan, as well as a handful of stores across the U.S. In this retail environment a few things hold true on the chocolate shelf. Due to the small size of these companies, each tends to have a unique brand and package. This makes for a busy shelf as they all compete for the consumer’s eye. After observing retail shelves, placement and POS merchandising for this market in multiple retail environments, the following patterns became obvious:
- Among more mainstream Fair Trade and Organic brands, there is a uniformity of brown and black, but within this artisan market each package is unique.
- Bright colors, such as red, detract, rather than attract, a consumers attention on the shelf. This is counter intuitive in an environment filled with browns and natural tones.
- Smaller gourmet and specialty stores will display merchandise in unconventional and surprising ways.
Outlined are competitors identified for research and testing for the project. The packaging for the product(s) used in the focus group have been listed below.
- PATRIC – packaging: Gloss finish cardboard envelope. Metallic ink. Cellophane/plastic inner package. Resealable with tab/slot in back.
- ASKINOSIE – packaging: Their packaging contains no bleach, is biodegradable and compostable. Reuse strings from bags of beans. The wax paper envelopes are recycled but not recyclable. Cellulose inner wrapper.
- ROGUE – packaging: Thick matte paper/paper board envelope. Resealable with tab closure. Inner cellulose wrapper.
- AMEDEI – packaging: Box lined with matte textured paper and foil stamping. Side slit opening and makes it resealable.
- FRANCIOS PRALUS – packaging: Tan paper wrapper with bright colored strips indicating the type of bar. Each package has a map of the world with a colored dot indicating the origin of the chocolate for the bar. Inner wrapper.
- MAST BROTHERS – packaging: Paper wrapper known for their patterns. Paper is made by an Italian paper maker. Inner wrapper.
- TAZA – packaging: Waxed paper, round chocolate, no inner wrap
- KALLARI – packaging: Brown box, white plastic inner wrapper.
- EQUAL EXCHANGE – packaging: Paper wrapper, inner cellulose wrapper
- DAGOBA – packaging: Paper wrapper, inner plastic wrapper.
- CHOCOLOVE – packaging: Wrapper. Known for bright colors of different flavored bars.
The United States is seeing high demand for organic chocolate due to increased consumer awareness about the origins of food, as well as a desire to experience new flavors.
- Men and women aged 18-34 were willing to spend the most on premium chocolate — on average, more than $8 per pound.
- Men and women aged 35-54 were willing to spend just over $7 a pound.
- Households earning $100,000 a year or more were willing to spend on average, $8.76 per pound.
- Households earning less than $25,000 a year were still willing to spend $6.47 per pound.
- The average amount of dollars spent across all incomes was $7.21. 1
Within these groups, dark chocolate consumers tend to be urban, health-conscious, environmentally-aware and informed customers.
Typically, these consumers seek high quality specialty foods, and they usually find it in gourmet food and gift shops.
The participants for the focus group were chosen for their similarity to the identified target consumer of premium chocolate.
- Adults age 36-45
- Educated – College graduates with Bachelors of Science degree or higher
- Professional – Budget (income of $100K+) for luxury or indulgent purchases
- Urban-centric – Highest quantity of artisan chocolate is sold in urban areas
- Creative – Color and design play a large part in purchase, as does initial messaging
- Adventurous – Many are looking for a unique experience, and are drawn to exotic and unusual packaging
- Lifestyles of Health and Sustainability (LOHAS) – A demographic defining a particular market segment related to sustainable living
- Foodies – Particular about their food choices, prefer high quality foods
HEALTH AND INDULGENCE – THE FOCUS GROUP
My focus group results support the market research. Several patterns emerged from the focus group sessions as statements of consumer preference.
- 95 percent of participants said they were willing to pay an average of 50 percent more for an organic product.
- Having the cocoa percentage clearly marked on the face of the package was important to all participants. It gave them a way to gauge the quality of the bar, and measure of the health benefits of the chocolate.
- All participants said they buy chocolate at gourmet groceries or specialty markets. They may visit a chocolatier or boutique shop to make purchases for a special event, but not for everyday consumption.
- All felt that the sustainable and ethical practices of the brand was important to them and that they would like to see these clearly listed on the front of the label.
- All participants believed a package that can be resealed was a convenience that would contribute to brand loyalty. The rich, intense nature of craft chocolate means it is eaten in small portions and the remainder stashed and saved.
- Women wanted not only a resealable, but also portable package that could withstand transport in a handbag.
- Smaller packaged portions (bite sized servings) were also a desirable option to both genders.
Venue staff education – The general consumer’s information gap regarding craft chocolate presents an opportunity for chocolate makers to educate the staff at retail outlets. A training session about the background of Mindo chocolate could have a dramatic impact on sales. Monthly or bimonthly informational visits and updates to outlets could keep product at the front of the minds of resellers.
Onsite marketing – Sampling and tasting are key to sales, especially in this unique and growing market. The taste experience for craft chocolate is intense and not easily forgotten.
Critical marketing information on front of package – Research participants noted they want or need to see information they deem important on the front of the package, such as:
- chocolate percentage
- cocoa origin
- organic certification
- ethical/trade standards
Back story – Focus groups emphasized they felt more likely to purchase a bar, even if packaging was nondescript, if the brand had an interesting back story. Displaying the back story on packaging could attract new customers, as well as serve as an educational tool for resellers.
Resealable packaging – All research participants said they would like resealable packaging, because they would not consume an entire 70g or 100g bar in one sitting. Women preferred packaging that could transport the chocolate safely when placed in a purse or tote bag.
POP – Providing retail venues with POP displays will keep branding and back story consistent throughout the market. A shipper designed to serve as a POP display would serve to establish brand consistency on retail shelves.
Materials & Processes
Three primary packaging types are currently used in this market. The box, which can take many forms, but is essentially a low profile rectangle. The paper wrapper, used with a protective inner wrapper to separate chocolate from the outside environment (flavors, temperature, breakage). The envelope-style package, which can vary from thin paper to heavy cardstock. The cardstock version of an envelope usually has flaps that secure in the back with a sticker tab. The paper envelope (or waxed paper, e.g. Askinosie) doesn’t seal, but relies on folding the end of the envelope to close the package. It is worth noting that all the brands tested contained some sort of inner wrapper, except for Taza which was simply wrapped directly in waxed paper with another piece inside to separate the two chocolate disks.
PRODUCT AND USER NEEDS
The primary objective (product needs) when packaging chocolate is to protect the product from the environment, and to protect the package from oils and acids in the chocolate. By examining the user’s needs, we understand what else packaging must do. One of the main requests by research participants was the ability to reseal their chocolate bar, so that they could return to it at a later time. Packaging should be durable to withstand transport in bags and totes. Packages that were easy to open and provided a way to reseal attracted the approval of research participants. Participants also said they preferred packaging that was made from recycled or recyclable materials. However, this was a lesser consideration when deciding on a purchase.
Paper is a key component in the package. Paper has a host of environmental issues that include deforestation, water use, chemicals and energy use. The best options when choosing paper are tree free (made from plant fiber other than trees) and recycled (preferably Post Consumer Waste sourced). For this project, I looked for alternatives to paper produced from trees.
Printing also has environmental issues. Standard printing requires chemical solvents and petroleum based inks. It produces tons of waste and requires large amounts of energy and water. For this project, it was paramount to use a printing company that engages in environmentally preferred policies and practices.
Environmental issues are a concern with cellulose bags/wrappers as well. Detractors claim that bio-plastics use crops that could be used for human consumption, thus driving up the cost of food.11 They are not recyclable with other plastics and most can only be composted in large municipal compost operations (not in backyard compost bins). Some are also not bio-degradable. And of course the production and transport of the bags uses energy and fossil fuel.
One potential solution to the Mindo package would be a “pillow” box style envelope made from tree free and recycled paper content. These papers could be supplied by EcoPapel in Ecuador (see supply chain), which can also perform die cutting. The die-cut envelopes would then be shipped piggybacked with cacao to Michigan, where they could be assembled in Mindo’s Dexter facility when needed.
The belly band for this design would be printed locally in Michigan by Janutol printing in Detroit. The paper would be 100% recycled, unbleached Kraft paper and printed in one color ink, with the logo die cut to reveal the handmade paper stock of the envelope beneath. These would be shipped to Mindo by truck and would be assembled at the time of use.
A custom POS shipper constructed of recycled mini-corrugated cardboard for 12 bars would feature a removable top for displaying the bars at point of sale. The box would be branded on the front with a 100% recycled, unbleached Kraft paper label. This will allow Mindo to control their branding in the various retail environments. These can be printed at the same as the belly bands, reducing printing costs.
A custom-made cellulose wrapper on the chocolate would protect the outer packaging from oil stains.
Supply Chain Review
Identifying the necessary vendors and supply chain for the design solution is a key part of the sustainable design process. The vendors chosen are done so for their location to each other, the source of production and the source of distribution as well as their environmental policies. This relationship is evident on the map at the end of the section.
The goal is to create smaller and smarter packaging that has positive end of life options (closed loop), utilizes recycled materials and has optimized (less) printed material in/on the packaging.
The following is an overview of the materials required and potential vendors for those materials and services.
Paperboard – outer package
- paper source: handmade paper
- Cellulose plastic – inner package
- Paper – belly band
- paper source: papermill
- Printing – belly band, POS label – ink, adhesive
- Corrugated cardboard – shipping/point of sale box
Transportation of materials in Ecuador would be done by bus. This is the cheapest and most common mode of delivery in the area of Mindo.
Ecuador to Dexter
This is currently done by air as it is the most cost effective and reliable method of transport at this time. Paper shipments can be piggybacked on product (cocao) shipment. Mindo can purchase offset credits to reduce the impact of the air travel from Terrapass.
UPS – they have great green initiatives and do what we need done, where we need it.
Supply Chain Opportunities
Through smart material and vendor choices it is possible to make this package with entirely renewable materials.