What is Product Labelling & what is the Importance of labelling?

Whenever you manufacture a product, you want to communicate the value of the product to the customers. One of the ways to do that is to use product labelling. Product labelling has become a means of communication between the brand and the consumer. Product labelling has very important information which is printed on the product packaging.

What is product labelling?

Product labelling is a part of the packaging of a product. Labelling is the written information on the packages. These written labels on the package cover important information which needs to be communicated to a customer. Product labelling is different from packaging. A product packaging might have the brand colours, the logo and the material as well as the shape of the package etc. The product is the informational / written part.

Example – A food product like Maggi noodles might have the ingredients of the product as well as the instructions on how to make the product written and illustrated on the package. These instructions are nothing else but product labelling by the brand.

Product labelling can be as less as simple one or two lines on the back of the product. Or it can be as much as the whole back end of the product being full of written information. If you pick up any shampoo, you will find the back to be full of information about the manufacturing location, customer service, ingredients, ways to apply, safety instructions and whatnot.

All these labelling requirements come from the regulatory body. There are numerous regulatory bodies for all products. So, the regulatory and governing body for the food product is the food and drugs administration (FDA). Even for cosmetics, FDA can decide the labelling requirements. This link shows the product labelling requirement for cosmetics in USA which has been designed by the US food and drug administration.

Thus, any new product in the market has to adhere to these packaging and labelling guidelines of their country’s regulatory bodies.

Importance of labelling a product

1) Brand and Product Identity

The label on the product is the primary product identity. The name of the product and the brand itself is considered as part of product labelling and these product labels form the brand identity.

Example – HUL generally mentions its own parent brand on all its products because it wants to remind customers that their products are under the umbrella branding of HUL and are not independent. Furthermore, it might be a legal requirement to publish the parent brand along with the sub-brand.

2) Grade and type

Every Sunsilk shampoo has different types. Besides changing the design and packaging style of the product, they also change the label on the shampoo. Some of them will say that the shampoo is Anti-dandruff shampoo whereas the other will say smooth silk. Thus, product labelling can be used to differentiate between the various grades and type of the product.

If you were to buy beer, then the beer does mention whether it is strong or mild. This is the grade of beer or drinks you are buying. Similarly, even packaged food industry commonly uses various grades to differentiate their products.

3) Requirement by law

As mentioned above, there are numerous labelling requirements which might be specified by a regulatory body. Some of them which are very common include Ingredients, manufacturing plant, batch number, expiry date, MRP, safety instructions etc. Thus, a company has to consider all legal requirements before deciding on the product labelling.

4) Description

By law, a product might not be required to print usage instructions on the package of the product. Some products use a manual to communicate the same whereas others imbibe usage instructions on the packaging itself.

If you buy Knorr soup, the package will tell you and give you specific instructions on how to make the soup. If you buy Kellogg’s corn flakes, the package will, in fact, give you specific diet instructions besides showing the normal ingredients and calorific value. Thus, in a description, we generally use instructions such as How to use, how to store etc.

5) Promotion

Buy 2, get 1 free. This is a type of product labelling which you would have most likely encountered especially during festive season. If a promotion is printed on the package, it has to be adhered to. It also comes to the immediate attention of the customer.

Quite simply, a large bottle of Vinegar is promoting that you might get 33% more vinegar at the same price. Now, this is a promotion which will immediately attract the customers’ attention. Note that in retail and hypermarket, there might not be in store promoters. At such times, your product labelling can become the last mile seller for your brand. A look at the product label can convert a prospect to a customer.

6) Additional information

There may be additional information on the product, of use to the customer, which can be used for product labelling. Example – A packet of Maggi which is made of whole wheat might have a picture of Maggi packet on top of wheat. This image will show that the product is healthy and might encourage customers to buy the product. Similar such additional information, which can be a differentiation factor can be used on the product.

In the era of E-commerce, product labelling has become very important because the customers are much more likely to reject a product which they don’t know how to use. So e-commerce sellers should ensure that the labelling on the product covers all legal norms and at the same time promotes the product.

It should also use proper usage descriptions, storage instructions and various marketing tactics to encourage word of mouth. In essence, research is required while deciding the product labelling.