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Home » Marketing management articles » What is Product Labelling & what is the Importance of
labelling?

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

December 18, 2017 By Hitesh Bhasin

Tagged With: Marketing management articles

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.

Page Contents

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.

Product labelling 1 - Importance of labelling

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.

Related: Channel Levels - Consumer and industrial marketing channels

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.

Product labelling 2 - Importance of labelling

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.

Related: 4 major challenges for Marketing managers of 21st Century

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.

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About Hitesh Bhasin

I love writing about the latest in marketing & advertising. I am a serial entrepreneur & I created
Marketing91 because i wanted my readers to stay ahead in this hectic business world. You can follow me
on Facebook. Let's stay in touch :)

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Comments

Joy Butler says

Hi Hitesh, thanks for sharing this information as it helped my daughter and her group with their
assignment. They’ll be having a trade fair at school. Product presentation is a requirement so they need
to label their chosen stuff. Cheers!

Reply

Hitesh Bhasin says

I am glad to be of help :)
Reply

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