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Global Retail: A design for success
Packaging turns a local producer into one of Norway’s most popular brands
By Jason Holland
July 01, 2013
There are many examples where food producers have scored a commercial hit from rebooting old fashioned-style recipes. In most cases, sustained success has come from surpassing basic food nostalgia to make those products appeal to the broadest possible consumer base.
One of the most effective ways to achieve that end is to adopt a contemporary approach to packaging design, a strategy that has worked particularly well for Norwegian manufacturer Lofotprodukt AS and its traditional “fiskekakers” (fish cakes).
The company’s portfolio comprises up to 60 different retail products and it is Norway’s market leader in the premium fish cake, fish burger and smoked/marinated salmon segments. Its biggest sellers are its Lofoten HjemmelagdeFiskekaker (homemade fish cakes), Lofoten 80 percent Fish Burgers and Lofoten Smoked Salmon.
The brand name Lofoten is taken from the island where Lofotprodukt is based, which is the location of one of Norway’s most important fishing grounds.
“We stick to old recipes that used to be handed down from generation to generation, and tell the products’ stories through a modern look,” says Camilla Beck Saetre, Lofotprodukt’s head of marketing.
Last year, the producer achieved a turnover of NOK 274 million (€36.6 million/$47.2 million). And while it has increased its sales annually for the past 10 years, it hasn’t been all smooth sailing.
Lofotprodukt was founded in 1994, just after the flame at the Winter Olympics in Lillehammer had been extinguished and when Norwegian confidence was at an all-time high. The venture was a merger of a fish processor and a smoked salmon producer that were going out of business due to financial difficulties. The plan was to utilize local raw materials to manufacture homemade-style fiskekakers, using the traditional ingredients of fresh fish fillet, potato flour, butter, milk and spices. Fiskekakers have been prepared by fishermen’s wives along the Norwegian coast for centuries.
“Local investors brought in fresh capital, believing in the idea of high-quality products,” says Beck Saetre.
However, the Norwegian seafood industry was in a very different place from today. It was much less dynamic, comprising many small manufacturers in every fjord in northern and western Norway. The mentality was simply to get fish out of the sea and sell it as fast as possible.
To make matters worse for these businesses, the retail structure changed: first from local to regional; and then to national chains complete with national purchasing departments. Today, Norway has just four national retailers with a combined 99 percent market share.
Survival became even more difficult, she says.
“Many companies without agreements with the chains were not able to get their products into the marketplace and have gone out of business,” says Beck Saetre.
Lofotprodukt grew slowly at the beginning, achieving a turnover of NOK 2.9 million (€387,380/$500,000) in its first year and NOK 10.8 million (€1.4 million/$1.9 million) in 1995.
By 2001, it had reached NOK 34 million (€4.5 million/$5.9 million), but this was still not enough to make a profit. That year, there was a board meeting and the main issue on the agenda was to decide whether the company should close or “really start investing for the future,” says Beck Saetre.
The board felt its products were high quality, but accepted the packaging was not up to the same standard. It was therefore difficult for retailers and consumers to differentiate between its products and those of lower-priced competitors, and so it agreed to invest in a new visual identity, including a new packaging design. To this end, it commissioned leading Norwegian brand and design agency Stromme Throndsen Design, and in 2003, Lofotprodukt re-launched its products in fresh, innovative packaging together with the new Lofoten brand.
“Through the new design, we communicated the Lofoten values — natural ingredients, high-quality and an emphasis on the fish content that justified the higher price,” says Oystein Rist, head of sales.
“We then decided to go national. We were determined to double the revenue and so we filled up a van with our products and drove to Oslo.”
Rist concedes the first few years were all about knocking on doors, shaking hands with store managers and “handing out thousands and thousands of samples” to store customers. The company eventually signed a contract with a large supermarket chain.
Lofotprodukt has upgraded its packaging designs twice since: first in 2008, to further clarify the healthy nature of the products and then last year, when it made all its packaging white. This set a clear design with an emphasis on natural that stands out from the competition on the supermarket shelf, says Rist.
Brand building and using design as a strategic tool has been essential to the company’s retail success, adds Beck Saetre, something that was confirmed in the company’s 2009 Design Effect Grand Prix award from the
Norwegian Design Council.
The company rolled out more new products in February this year, including a new 80 percent cod and haddock fish burger, which was chosen as a finalist in this year’s Prix d’Elite new products competition at the European Seafood Exposition. At the same time, its first TV commercial aired, emphasizing the fish content and natural ingredients used in Lofoten products.
“Although it is always difficult to totally isolate effects, we are convinced that the commercial contributed to the high sales we experienced for the products involved,” says Beck Saetre. “Brand awareness also increased significantly.”Contributing Editor Jason Holland lives in London