Analysis and Insights on the Luxury Packaging Industry today and for the future.

1. Analysis on the packaging
industry for the luxury sector
B2B Marketing - Spring Electives
28/06/2015
Carlos Vargas - Maarten Sisselaar - Mariana Knoedt - Nehmen Nehme

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Contents
Special Thanks to M. Eric Blanche................................................................................................. 3
1. General view of the market......................................................................................................... 4
1.1 B2B marketing in the Luxury industry ................................................................................. 4
1.2 Packaging in the Luxury industry ......................................................................................... 5
2. B2B dynamics in this market:..................................................................................................... 9
2.1 Profile of Mr. Eric Blanche................................................................................................... 9
DS Inovir ................................................................................................................................. 9
PAK 2000 ................................................................................................................................ 9
2.2 Business to Business dynamics: reality and opportunities.................................................. 10
Primary Packaging:................................................................................................................ 12
Secondary Packaging:............................................................................................................ 13
3. Trends and Recommendations.................................................................................................. 14
3.1 Trends.................................................................................................................................. 14
The ecological and sustainable concern ................................................................................ 15
3.2 From Product to Services to Solutions................................................................................ 15
3.3 Recommendations............................................................................................................... 17
How to use technological innovations to maximize the input?............................................. 17
How to give the packaging a second life? ............................................................................. 17
How can the secondary packaging increase the value of the luxury product?...................... 18
The 4Ps Revisited.................................................................................................................. 18
So what? ................................................................................................................................ 18
4. Conclusion ................................................................................................................................ 19
5. References................................................................................................................................. 20

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Special Thanks to M. Eric Blanche
First of all, we would like to express our gratitude to Mr. Eric Blanche. He devoted his time to
helping us understand the packaging business for the luxury market. Due to his experience and
insights we were enabled to further explore and analyze this market from a B2B marketing
perspective.
We hope that our paper not only provides an analysis of the current situation but also sheds some
light on how Mr. Blanche and his company can move forward. More specifically, we’ve made an
effort to include some suggestions on how to stand out in this competitive market. Creating
additional value might lead to opportunities to move from a product-oriented to a services and
solution oriented approach.
After a general overview of the role of packaging in the luxury market this paper looks at the
Business to Business dynamics; current state, opportunities and the distinction between primary
and secondary packaging. The second half of the paper is future oriented and takes trends into
account before moving to recommendations on how to move from products to services.

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1. General view of the market
1.1 B2B marketing in the Luxury industry
Since opinions in this matter widely differ there is no one clear definition of luxury. But to shed
some light on the meaning we explore a few variations:
Traditionally the word luxury applies to tangible goods, suggesting superior materials and designs
sold in an upscale retail environment – Bain & Co
Exclusivity, premium prices, image and status which combine to make them more desirable for
reasons other than function – T. Jackson
Other people would refer to “expensive rare objects with an image of good taste” or to “categories
and famous brands held in the world as symbols of luxury”. In the end the definition is personal
and can be explored in terms of absolute meaning, relative meaning and a purely individual
meaning (Kapferer, 2010).
With regard to this paper it is useful to also look at luxury from an economist’s point of view. This
view differentiates luxury products and services from non-luxury through the substantial price
premium that is related to non-functional benefits. For example, a Givenchy IPhone cover might
provide the same protection to your phone when compared with a non-branded alternative from
the supermarket however the price of the Givenchy version might be tenfold.
Premium versus luxury
Luxury products and brands are not to be confused with premium. Premium (Nespresso, Victoria
Secret) brands might have better quality, selective distribution and emotional value but they do not
have the role in society that luxury does. Luxury has the unique capability to provide social
elevation. Luxury brands have something magic that support the upward social mobility of
consumers (see below).
Business to business (B2B) concerns businesses that sell goods or services to another business as
opposed to a business selling something to a consumer. A B2B relationship differs from a B2C
Fig.1: Upward social mobility of consumers. Kapferer 2013

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relationship in many ways; one dimension concerns the extent to which B2B buyers are more
professional and demanding towards their suppliers. The demand additional value at a competitive
price. In some cases this means that buyers engage in relationships with their buyers rather than
simply agreeing on a transaction.
Therefore, in a luxury market it makes sense (from a B2B marketing perspective) to analyze your
customers’ brands. Depending on whether the brand can be classified as luxury or premium they
will look for suppliers that with different assets and characteristics. The challenge of the supplier
is to create a successful B2B marketing strategy in the sense that it matches the buyer’s specific
needs.
Types of luxury
Within the luxury domain there are again various ways to classify brands and business models.
Kapferer delved into the notion of luxury from a consumer perspective. He distinguishes four types
of luxury:
Types What defines luxury? Examples
Bespoke, authentic
Beauty of an object
Excellence of the products
Rolls-Royce, Cartier, Hermes
Modern, creative
Creativity
Sensuality of the product
Gucci, Boss, Gaultier
Conformist, recognition
seeking
Magic
International reputation
Vuitton, Porsche, Dunhill
Flashy, standing out
Very few purchasers
Belonging to a minority
Chivas, Mercedes
This exemplary classification serves to show that consumer expectations and related brand equity
have an impact on their respective business models. From a B2B marketing perspective it’s worth
it to delve into both the buyers’ business models and the subsequent needs of end consumers.
1.2 Packaging in the Luxury industry
Traditionally, the development of packaging is seen as an integral part of the development of a
new process. Often though, the packaging is outsourced profiting from the expertise and
economies of scale amongst other things. The requirements of the buyer of packaging depends on
the industry and could be related to design, shelf-life, quality assurance, logistics, legal, regulatory,
graphic design and the environment. In addition to the actual packaging requirements a buyer can
evaluate a suppliers’ performance based on speed of delivery, design expertise and many other
process criteria. These process criteria can for example ultimately help a buyer to decrease it’s
time to market.

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Role of packaging in luxury
In the luxury industry packaging plays a specific role. More than in other industries the packaging
of luxury goods is often seen as part of the experience, or as some say: “packaging sells”.
Packaging can for example play a crucial role in showcasing a product (jewelry), in protecting a
product (designer eyewear) and building the products brand (Tiffany’s blue box and bag).
Thus, most luxury companies look at packaging as a way to enhances and supports the value and
(scope) of their products or services. If the purchase of a product is supposed to create an exclusive
and uplifting experience than the packaging is expected to contribute to this experience. Moreover,
packaging luxury products should stand out from non-luxury and contribute to the story telling
that these companies excel at. Finally, the packaging can even outlast the products itself. This can
be the case for wine bottles and fragrance bottles as they are sometimes kept and treasured by
consumers.
Another example, where the packaging is part of a ritual; when ordering from an exclusive online
fashion platform such as net-a-porter the branded packaging and ribbons are part of the experience.
Hermes will always refer to their brands heritage by using the color orange in all products, labels
and packaging. The jeweler Tiffany has even managed to have a color (Tiffany blue) named after
their packaging, not their product.
Fig.2: Examples of Packaging

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Primary and secondary packaging
It is important to distinguish between primary and secondary packaging:
Primary packaging refers to the industrial level packaging that goes with the product. For example,
the bottle containing perfume. Secondary packaging refers to the packaging done in the retail stage,
for example, the branded bag to carry a purchase or a canvas ‘dust bag’ covering a leather bag.
The box containing a timepiece is a special case. As you will never imagine selling a timepiece
without the support base it is considered to be in between the primary and secondary packaging.
Market developments
Basically, since luxury is about excellence, heritage, unique experiences every detail counts. This
is why packaging will never be underestimated in this industry. In terms of business opportunities,
the global recovery and strong growth in emerging markets are generating new opportunities for
luxury brands. And as the market is further diversifying (e.g. masstige) the potential for the
packaging industry that caters to the industry’s needs is promising too. (Euromonitor. 2011)
Looking for ways to profit from these opportunities the luxury packaging industry - as part of the
retail experience – specialized packaging for the luxury took off in Europe in the 60’s. Today, the
key players in the industry are: Amcor Ltd., Crown Holdings Inc., International Paper Co.,
MeadWestvaco Corp. and Owens-Illinois Inc. Other big players in the market are: Ardagh Group,
Aropack, Bag & Pack, BC Boncar, Benson Group, Ch. Dahlinger, Classypac, Cosmopak, Curtis
Packaging, Design Packaging, Dupont, Duran Dogan, Fleet Luxury, HH Deluxe Packaging, Ijen,
Interconti Systems, Italesse, Jonathan Virginia, K-1 Packaging, Keenpac, M&H Plastics, MW
Luxury Packaging, Pak 2000, Pendragon Pack, Prestipack, Smurfit Kappa Group, Suttons Wrap,
Treadstone, Vivant, Witty Pack and Wrapology. (ASD Reports, 2015)
Currently the trend is that demand for sustainable packaging materials is increasing. Consumers
and companies are getting more consciousness about the environment and therefore packaging
with eco-friendly materials is on the rise. Simultaneously the demand for glass packaging is
declining. The heavy weight and the brittleness of the material are drivers of this trend. Meanwhile,
aesthetics still play a large role and are thus considered one of the big drivers. The industry players
invest in innovative packaging to cater to the needs of their buyers. (ASD Reports, 2015)
The packaging goods industry is considered as a highly competitive market. After consolidation a
select group of global players dominate the market and create entry barriers due to their scale.
Also, the relationships between buyers and sellers can be seen as a barrier to entry.
PRIMARY PACKAGING SECONDARY PACKAGING
Part of the product; Added in the industry level. Not part of the product; Added in the retail level.
Examples:
 Bottle of perfume
 Bottle of wine & spirits
Examples:
 Paper bags and boxes
 Ribbon and other accessories
 *Box and support for watches
Fig.3: Primary and Secondary Packaging

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Meanwhile, the purchasing departments of luxury companies still tend to treat packaging as a cost
center. The pressure on price that results from this dynamic is not to be underestimated. In practice
buyers will not only threaten but indeed choose to move to another price level if the price is
considered too high. This means that in many cases the expertise, relationship and or innovations
of suppliers do not outweigh the need for low priced packaging. More detail is provided in 2.2.
(Interview E. Blanche, 2015)
Creating opportunities
Currently packaging companies are still treated as cost centers. This leads to risk since buyers can
and will change suppliers as long as they are not able to create new and unique selling points and
create additional and superior value. Superior value is (here) defined as tangible benefits that are
sustainable.
One way for companies to create additional value is to try and move from products to solutions.
The risk involved when doing this is related to the speed of diffusion and sustainability. While
doing this a company can create one-off advantages and lasting advantages. These advantages can
then be either tangible or intangible, see below. In order to create true solutions luxury packaging
players have to push themselves and create these advantages. On-going advantages are preferred
over One shot and Tangible Advantages over Intangible.
Type of customer advantage
Tangible
(easy to quantify)
Intangible
(difficult to quantify)
On-going
Time to market
Cost (of production)
CO2 emission
Cost of logistics
One shot Risk
Optimisation
Consolidation
Source: Dalsace, 2015
In this paper various opportunities will be discussed. However, this is known to be a difficult and
time consuming process. First of all the learning curve is long due to complex organizational
processes that need to adapted, because the company needs to learn how to find and secure the
“good” contracts (related to pricing and contracting). Secondly, this process usually implies high
fixed costs, due to the need for large customers and the fact that the most eager customers ofter
are amongst the riskiest. (Dalsace, 2015)

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2. B2B dynamics in this market:
2.1 Profile of Mr. Eric Blanche
In order to better understand the dynamics of the business-to-business relationships in the packing
for the luxury market, we analyze the experience of Mr. Eric Blanche, who has more than 20 years
of experience in fine packaging for high end products, developing primary and retail packaging
projects for perfume, fashion and luxury brands in France and abroad. Today, Mr. Blanche is the
Development Director of DS Inovir in Europe and also Président HEC Alumni Luxe & Creation.
As part of the profile of Mr. Blanche, we resume the business description of DS Inovir and Pak
2000, packaging company for which he worked from 2000 until 2013.
DS Inovir: the company delivers product-packaging innovation and excellence to major brands
worldwide. As an international packaging service corporation, with offices and factories in Europe,
North America and Asia, DS Inovir delivers all types of retail and promotional shopping bags,
boxes, presentation cases, pouches, ribbons, labels, and other packaging accessories.
According to DS Inovir public information, luxury and specialty packaging is one of the seven
touch points of a brand1
, being with the product, the only ones who actually go to the home of the
customer. DS Inovir proposition is to deliver return on investment (ROI) to their clients through a
complete service characterized as flexible and secure. There are three main points particularly
interesting about DS Inovir offer in their website:
 DS Inovir offers a complete packaging development –alpha-to-omega packaging creation
service– from which it results a melted product with a branded packaging.
 DS Inovir offers a fee based packaging development, through which the customer receives
a lifetime turnkey packaging management experience from DS Inovir managers.
 DS Inovir offers the service of organization and supervision of worldwide logistics and
distribution for their customers, either including the product or through a fee basis tied to
a packaging project management.
PAK 2000: is a “leading provider of prestige bags and boxes for a wide variety of industries,
including the cosmetic, fragrance, personal care, luxury, and fashion sectors.” The company
manages two specific lines of packaging concepts: value-added luxury packaging and security
packaging, through which they not only offer functional, durable and elegant packaging, but also
a wide range of materials and types of prints to personalize and customize. According to their
website, PAK 2000 emphasis in the idea of how luxury companies are not only in the business of
providing consumers with excellent products, but also to offer esteem, as part of a lifestyle choice.
In this sense, the company says:
“For many, being able to be proud of a purchase is just as important as the quality of the
product. Providing a complete customer experience is part and parcel of luxury branding.
Our solutions are designed to maximize not only a company's ability to market their brand
post-purchase, but also to provide the consumer purchasing the product with suitable outer
packaging that increases esteem.”
1
According to DS Inovir website, the seven touch points of a brand are reputation, media, product, store
environment, displays, services and packaging

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As part of their offer, PAK 2000 talks about a full range of support to their customers through
services and processes that include brand coaching, project management, quality control, customer
services and worldwide tailored logistics. Their methodology is resumed as:
A key point of their public information includes environmental concern, offering bags that can be
reused, as well as 100% biodegradable. The company has several industry certifications that
concern sustainability as:
2.2 Business to Business dynamics: reality and opportunities
The company public profiles seemed to be aligned to the theory of business to business marketing,
but as part of the study, we had the possibility to talk to Mr. Blanche, who gave us a real perspective
about what is happening in the luxury packaging industry nowadays. According to him, luxury
companies still use as purchase technique for packaging the old, transactional approach, aiming
for the best possible quality at the lowest possible cost and maintaining a relationship with
suppliers mainly through their purchase team, as illustrated in Figure 6.
Particularly, the suppliers have low understanding of how the customers buy in all levels (rational,
organizational and political) and consequently have low power to influence their buyer decision.
Furthermore, most of the times, the relationship across the value chain is anti-industrial. The
pressure is originated by the retailers and it is back-propagated to the suppliers:
Fig.4: PAK 2000 Solutions methodology
Fig.5: PAK 2000 Environment Certifications

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 Retailers/distributors pressure the luxury companies to receive samples of the products
before placing an order (space/shelf, SKU, quantity, etc.)
 In the luxury companies, marketing, finance and retail teams pressure the purchasing area
to find the best quality at the lowest cost, which ends up with a purchase team that looks at
packaging under a cost/pricing perspective
 The purchasing team asks different suppliers for possible prices. Given the pressure from
retailers and distributors, luxury companies have decided to start narrowing their pool of
suppliers and actually using the same treatment as distributors do with them: in order to
keep you in the short list of packaging suppliers, you need to give them samples before
even placing an order
To complete the scenario, according to Mr. Blanche, the environmental impact of the packaging
industry is changing the business, especially the secondary packaging, which is seen as a waste.
This factor makes the industry sensitive to any environmental new policies and consumers
behavior related to this topic.
It is important to mention that in the specific case of perfumes, the approach follows the new model
or the relational one. Because the bottle is considered as part of the product, the suppliers must be
in contact with marketing and branding people, as well as top management, in order to develop a
bottle 100% aligned with the product and the brand story-telling.
As an illustrative exercise to assess the opportunities the luxury packaging companies can have
in terms of business-to-business marketing given their customer-buyer relationships, we decided
to use the framework given in class to evaluate the potential for them to evolve towards a more
relational approach and if it would be worthy to do so.2
2
This is just an illustrative exercise given the time and resources constraints. The analysis is primarily based on the
interpretation of the authors from the conversation with Mr. Blanche.
Fig.6: Customer – Supplier relationship
Customer (luxury companies)
Suppliers (packaging companies)
OLD MODEL: ONE POINT OF CONTACT NEW MODEL: MULTIPLE POINTS OF CONTACT
Customer (luxury companies)
Suppliers (packaging companies)

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From the luxury companies (customer’s) perspective:
Aspects of value creation Sense towards
relational
approach
Primary
Packaging
Secondary
Packaging
Market Offering
Complexity of the prod. process  7 5
Need of tactic know-how (art) – vs codified knowledge
(science)
 7 7
Degree of customization  7 7
Supply market conditions
# of alternative suppliers  4 1
Demand fluctuation  2 2
Technogical uncertainty  2 2
The customer’s perspective
Role of the offering on the downstream market  7 7
Purchasing power  4 2
Degree of differentiation  6 5
Partnering Potential (average) 5.1 4.2
*1: high likelihood of transactional approach / 7: high likelihood of relational approach
Plotting the results in the “Partnering potential vs Reality” matrix:
We can observe that primary and secondary packaging are in very different positions:
Primary Packaging:
They are placed in the cluster “Pie expansion”, meaning they have a high potential of partnering
and their customers know that. They must strength the multiple-contact relationship they already
have with the luxury companies and keep making new proposals.
R
E
A
L
I
T
Y
Partnering Potential
Relational potential
over-estimated
(“Rose-colored
glasses”)
Primary Packaging
Secondary Packaging
Relational potential
under-estimated
(“Necessary
enlighten”)
“Pure market”
“Test the water”
“Pie expansion”
Fig.7: Partnering potential vs Reality

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An interesting fact here is that other primary packaging could be in the same position as perfumes.
This could also represent an opportunity for the wine & spirits and beauty industries, for example,
to develop different solutions and to have a different relationship with their customers.
Secondary Packaging:
The secondary packaging is currently in a situation where the relational approach potential is
under-estimated by their customers. We can see three important steps in this case:
1. Reassess the partnering potential grade obtained (4.2) and make sure this is not a case of
pure market. If this is pure market, there is low potential of partnering and it will be a cost-
based relationship. There is not much they can do.
2. If the reassessment confirms the under-estimated relational approach, the company will
have to show the customers the opportunities they are missing. This could be done by a
pilot project with a good customer, so they would have a successful case of new
relationship to support the following contracts.
3. If they succeed to match potential and reality, they would fall in the “Test the water”
position of the graph. In this position, it is important to invest on the aspects that indicated
high potential to a relational approach (the ones graded with 7 in the table) and try to move
to the same area as the primary packaging – “The pie expansion”. We believe there is a big
opportunity to better explore how the packaging suppliers can bring more value to their
customers if they are involved in the creation of the packaging and development of the end
customer experience in the retail.
It is important to say that moves 2 and 3 require significant amount of investment from the
packaging companies, both in terms of time and money.
Another important note concerns timepieces and jewelry. As already mentioned, they are in-
between the primary and secondary packaging and there is for sure a potential to develop a better
relationship with their customers and have a more interesting position in the market.
As Mr. Blanche indicates, the packaging plays a key role in the theater game of consumption of
luxury – they create emotion and they seduce the end customers. Definitely it makes sense for the
packaging companies to have a much more strategic role in this sense. On the other hand, it is
important to realize that creating the story telling is part of the core business of luxury companies
and they are very jealous about sharing this activity with others.

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3. Trends and Recommendations
In this section, we start first by discussing the main trend impacting the packaging in the luxury
industry. Then, taking this trend as a starting point, we use an “ideal world” approach to change
the status quo for the packaging industry from products to services to solutions. And finally we
close on a couple of recommendations summarizing our team’s discussions.
3.1 Trends
First, as shared during our interview with M. Blanche, the main trend in the industry and the main
opportunity comes from the shift, in the past five to seven years, to the green and sustainable
aspects in the luxury industry.
We have researched some illustrations of such a trend, and found a long list of cases. Some of
them come to us from GUCCI (Kering Group):
“In June 2010 Gucci launched a completely new range of packaging, created by Frida Giannnini,
which is 100% recyclable. In all of our stores worldwide this packaging will offer a bold new
image of luxury that is sensitive to the environment and in keeping with the Gucci heritage of
quality and excellence.”
And from Stella McCartney (Kering Group):
“When Stella McCartney first went into business and chose to operate using sustainable
production, others might have thought she was strange, since the luxury industry has not
historically thought of its environmental impact. Choosing to operate an apparel and accessories
label without leather is an uncommon decision.”
But also from the Sustainable Luxury Working Group and from external reports such as the 2014
Greenpeace report (studying eight fashion and luxury brands: Dior, Dolce & Gabbana, Giorgio
Armani, Hermès, Louis Vuitton, Marc Jacobs, Trussardi and Versace.)
Fig.8: Gucci – “New packaging is 100% better for the world”

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The ecological and sustainable concern
Some of the top managers in the luxury industry are looking at packaging as an environmental
issue and this makes the industry sensitive to the new environmental policies. Moreover,
consumers are now more educated and some of them see packaging as a waste.
Work has started on building papers that are certified, on ways to introduce practices of reuse of
packaging. Mr. Blanche mentioned the example of Hong Kong government’s recent regulation,
whereby all shopping bags, which are not certified recyclable, must be paid (at a premium) by the
end customer.
Competitiveness criteria should be moving towards:
 The Green aspect (Certified Origin of Materials, Sustainable forests)
 Labor conditions at the suppliers
 Recyclability becomes essential; less plastic as the packaging becomes non-recyclable
Mr. Blanche also shared an interesting example in the case of Cartier. The following can be found
at Richemont website: “For packaging activities, Cartier engaged a specialist firm to carry out
complete life cycle analyses for two of its iconic packaging products: the Cartier red bag and the
Cartier red gift boxes” The reasons behind such effort are the aforementioned environmental
concerns; Cartier wants a more ecological version of its products. However, when 100% recyclable
materials are used, it becomes an industrial and technical challenge to provide the exact same
emblematic texture and color (texture and color consistency issues).
3.2 From Product to Services to Solutions
Taking this trend as a starting point, we use an “ideal world” approach to challenge the status quo
and propose a move from products to services (and maybe to solutions).
First question to ask: how to turn the commoditization threat detailed in the previous sections into
an opportunity?
In a 2x2 matrix, there are three methods to break through to the other side of commoditization.
These three options are summarized in the following extract from the academic lectures:
Fig.9: Selling Services (B2B elective Lecture)

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In order to break the commoditization threat successfully, the product needs to evolve into a value-
added product, and this is done through product innovation on one side and through services on
the other side.
According to inputs from Mr. Blanche, the packaging makes up to 5% (depending on the product)
of the costs of the final product. So, how can we maximize this input and how can we increase the
perceived benefits of the customers’ customers?
One of the ideas came from the distribution channels. Traditionally the delivery is made to the
warehouse of the luxury company, but Mr. Blanche has started to notice that some of the major
North American suppliers are starting to deliver to the retail shops of high end customers.
And the question becomes: what other customer processes can be transformed into services? The
answer might be in transforming such processes into a full design consultancy or a green impact
consultancy.
From this discussion we realize that in this industry, the move to services is still at its early stages
(not to say absent). And this transforms the next step, solutions, into a dream that is hard to guess
with today’s inputs.
However, M. Blanche shared with us one success story in this direction. This case was done with
ST Dupont (probably for a Limited Edition). The supplier worked with different decision people
at ST Dupont to realize a packaging that had the same look and feel as the product inside. The
supplier took the risk of the design challenges and costs. The industrial challenge per se brought a
number of innovations to the product. The result was a marketing success, but, due to several other
reasons, the relationship did not evolve further into a more integrated buyer/seller relationship.
Coming back to our B2B Marketing approach, we know the mandatory five steps to implement a
services and a solution approach. We believe that most suppliers are stuck in the first and/or the
second step of the process:
Understanding
customer
processes
Targeting
priority
customers
Managing
salesforce
evolution
Developing
value
documenters
Industrializing
service
operations
Fig.10: Maximizing the Input and the Perceived Benefits (B2B elective Lecture)

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3.3 Recommendations
And finally we close with a couple of recommendations summarizing our team’s discussions.
These recommendations are based on the previous analysis and on some open questions that we
tried to tackle.
How to use technological innovations to maximize the input?
The most important characteristics of luxury packaging are a result of the high quality material in
use. However, they are also a combination of nice finishes and innovative shapes.
Knowing that, in the luxury industry, putting a timepiece on the wrist was considered as a
technological innovation (Cartier’s Santos Dumont first pilot watch), one can imagine that,
combining the 21st
century high tech know-how with the luxury brands will result in infinity of
possibilities.
For example, in order to increase the end customer satisfaction, and to provide him/her with a
personalized experience, we thought about the interactions with 3D Printing, and how the supplier
of packaging can become a service provider to his customer. This point is detailed in the next
questions.
How to give the packaging a second life?
One of the aspects where the packaging industry might re-invent itself, meet the environmental
challenges and re-introduce the sense of artisan-ship is through giving a second life to the
packaging.
The easiest examples come to us from the Wine industry. Wine bottles can be re-used as candles
as shown in the link, and people spend their time finding many other uses that a bottle of luxury
spirits might have, one of such examples is illustrated in the photo here below.
Fig.11: Second Life for Packaging

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Another example comes from Hermès, and more precisely Le Monde d’Hermès. The brand has
introduced an app that accompanies the magazine and allows the reader to re-use the covers and
make nice 3D origami. We can agree that it’s a short lived second life, but at least, it’s a start that
can generalize into more innovative ideas.
Finally, we are currently considering a more holistic approach whereby the various packaging
(boxes, bags, bottles etc) used by a brand can be returned to the luxury house and a craftsman
would transform the collection into an end customer product per se.
How can the secondary packaging increase the value of the luxury product?
The luxury product is already an overvalued product as the price is not correlated with the costs.
The value of the dream and the value of the experience are added to the costs (among other things).
However, let’s imagine the following scenario:
- The packaging supplier introduces an innovative design of the bag or the box
- The end customer adds his personalized touch on a specific set of items
- The delivery of the final package is done within 24hours to the point of sale where the end
customer wants to pick-up his/her luxury product
In such an imaginary scenario, we can see the added value that the supplier could bring to the
luxury brand.
The 4Ps Revisited
In aligning People from the industry with the Planet welfare and the stakeholders’ Profits, the
packaging in the luxury industry still has a role to play
- in increasing the end customer satisfaction by providing him/her with a personalized
experience,
- in increasing the brand’s value in the mind of the Generation Y through a sustainable and
ecological approach,
- and in increasing the size of the pie by re-inventing new ways for craftsmanship and
ingenious designs
So what?
Faced with such dilemmas and potential, the main challenges remain in terms of how to introduce
true solutions in packaging, regarding the recycling/green propositions and project management/
fee based contract services, to the luxury houses.
From our perspective, it will be key to implement this transformation from products to solutions
with the framework developed by Reinartz and Ulaga3
, in which they suggest to take the time and
do a progressive transformation.
“Successful firms begin slowly, identifying and charging for simple services they already
perform and using those to build enthusiasm for adding more complex ones.” (Reinartz
and Ulaga, p.92)
3
How to sell services more profitably. Harvard Business Review. May 2008

19. 19
4. Conclusion
According to the analysis, the packaging companies for the luxury industry should emphasize to
their customers about:
 The packaging role in the end-customer experience when buying a luxury good (it is an
inevitable tool, but it can add real value and it is actually underestimated)
 The environmental issues related to packaging (need of innovation not only in materials
but also in how the packaging can be reused / recycled)
Additionally, the packaging industry needs to look the situation from a macro perspective and
understand where are the pains of their customers that they can help address. There is a wide range
of potential investments that packaging companies could do in order to implement true solutions
in their offer, as direct delivery of packaging in the boutiques instead of the warehouse. Other
possibility could be an initiative to hire and train experienced professionals in marketing for luxury
houses, who will be in charge of working directly as consultants of luxury packaging. For all those
potential initiatives it will be key to industrialize the back office of the packaging company, which
includes to build flexible service platforms, to constantly monitor the cost of processes and to
exploit process innovations from new technologies.4
4
Reinartz and Ulaga. How to sell services more profitably. Harvard Business Review. May 2008. p.94

20. 20
5. References
Interview with Mr. Eric Blanche Tuesday June 23, 2015 in Paris.
http://www.gucci.com/uk/worldofgucci/mosaic/think_and_act/the_environment
http://www.luxurydaily.com/sustainability-in-luxury-fashion-should-be-a-no-brainer-stella-
mccartney/
http://www.greenpeace.org/international/Global/international/publications/toxics/2014/A-
Fashionable-Lie.pdf
https://www.richemont.com/corporate-social-responsibility/case-studies.html#CaseStudy21
http://www.bsr.org/en/collaboration/groups/sustainable-luxury-working-group
http://www.lesraffineurs.com/du-temps-libre/8-bougies-rewined-cepage-des-vins.html
http://www.networx.com/article/ways-to-reuse-wine-bottles
http://www.hometalk.com/1748743/ideas-on-how-to-recycle-wine-bottles
http://www.luxurydaily.com/hermes-creates-origami-app-to-accompany-print-
magazine/?utm_referrer=https%3A%2F%2Fm.facebook.com&utm_referrer=direct%2Fnot%20p
rovided
http://www.cartier.com/collections/watches/mens-watches/santos-de-cartier.html
Reinartz and Ulaga. How to sell services more profitably. Harvard Business Review. May 2008