Most physical products going to market have to be packaged. Packaging can play anything from a minor role where it simply protects the product from damage, to a strategic role where it becomes part of the distinctive image of the product itself, such as the Coke bottle.

Packaging includes all the activities of designing and producing the container or wrapper. The primary package is the product's immediate container. Thus, the bottle holding say a perfume product is the primary package.

The secondary package refers to material that protects the primary package and is discarded before use. The shipping package refers to packaging necessary for storage and identification. This can be a shrink-wrap container or a corrugated box carrying a dozen or more perfume bottles.

Packaging is particularly important in the following circumstances:

Where the end user sees the packaging. In supermarkets, for example, the package must perform many of the sales tasks. It must demonstrate the product's features, give the consumer confidence, and make a favourable overall impression.

If a business executive opens his/her purchase. This presents another opportunity to create a favourable image for your company.

Where a well-designed package can contribute to instant consumer recognition of the company or brand. For example, the familiar yellow packaging of Kodak film.

If there is an opportunity to provide a value-added innovation to the packaging. This can provide an opportunity to improve profit margins or build customer loyalty. Wine bags, for example, have made it possible for consumers to have a glass of wine without having to open a new bottle.

If consumers are likely to have environmental concerns then the packaging attributes of being made from reused materials or being recyclable, can be emphasised.

Developing an effective package involves firstly establishing the packaging concept. Should the main function of the package be to:

Offer superior product protection?

Introduce a novel dispensing method?

Suggest qualities about the product or the company?

Offer a special discount, prize or giveaway?

Decisions must then be made on package design – size, shape, materials, colour, text, and brand mark.

After the packaging is designed, it must be put through a number of tests: physical tests to ensure it stands up under normal conditions; visual tests, to ensure that the script is legible and the colours well-balanced; dealer tests, to ensure that dealers find the packages attractive and easy to handle; and consumer tests, to ensure favourable consumer response.