In today's economy, retailers are continuously challenged to differentiate themselves as both store operators and brand owners, functioning as both an ally and a competitor of the national brands. In Western Europe, where retail consolidation is high, we are witnessing a 50 percent-plus market share of retail brands in core food categories such as dairy and juice. But when examining the same in the United States, the landscape is quite different.

Domestically, retailers need to approach the competitive marketplace and leverage existing relationships to drive innovation in the grocery aisle, make the best package selections for their customers and prosper. They could do so by focusing on four critical areas.

1. Be mindful of the needs and mentality of today's shoppers.
Today, nearly 60 percent of households in America comprise one or two people who, more and more, are seeking greater efficiency in their day-to-day lives. That desire also extends to their household goods, where convenience, size, ease of storage, and disposal are increasingly driving purchasing decisions. The shift from a "bulk mentality" — along with the rise of such non-traditional families as couples without children, single parents and empty nesters — also has implications for packaging sizes.

Developing solutions for smaller households by adopting single-serve packages for products such as juice and dairy beverages is a core area of growth — an area that retailers and national brands alike are working to satisfy.

Additionally, recent data from Tetra Pak's "Environmental Research 2011" survey shows some 88 percent of consumers in 10 countries expressed a preference or strong preference for products in recyclable packaging. In the United States alone, some 70 percent of the survey's respondents said they are willing to buy a "green" product if the quality is the same as a "non-green" alternative.

2. Redesign the grocery aisle (literally).
Leveraging the power of space and product imagery is a core component to differentiating store brands. Because products are tightly packed and always facing the consumer, eye-catching packages that create an impact at the shelf can help revitalize a brand image and create a unique product concept. To select the right package, retailers would do well to examine options that are both visually enticing and add to the overall efficiency of the shelf space and display area.

For example, consider Tetra Pak's Tetra Recart, the first retortable carton package designed for shelf-stable products traditionally filled in cans, glass jars or pouches (foods such as vegetables, beans, tomatoes, pet food, soups and sauces). Recart provides a way for store brands to stand out on the shelf, creating a competitive advantage for retailers from a visual standpoint. The package's flat surface enables new design options and creates a billboard effect when lined closely together on the shelf. The package also enables cost savings through its rectangular shape, low package weight and secondary packaging — in store and throughout distribution. Additionally, it generates 30 to 40 percent space savings over canned packaging.

3. Take advantage of market trends.
In developed markets such as North America, Western Europe and Australia, where milk consumption is already high, dairy producers are driving new growth by developing new products and consumption occasions, promoting milk in appealing new ways, catering to consumer trends and promoting the benefits of long-life products.

While the familiarity of ambient dairy products (dairy that can be stored at room temperature without refrigeration for up to a year) is widely accepted among consumers in Europe, the market is still fresh in the United States. For retailers, the distribution of ambient dairy products represents an opportunity for product differentiation among consumers, along with cost benefits and sustainability implications for the supply chain.

From an energy savings standpoint, ambient dairy products stored in aseptic packages help to reduce greenhouse gas in transport while also reducing energy expenditures within stores. According to Energy Star, a joint energy savings program with the U.S. Environmental Protection Agency and the U.S. Department of Energy, refrigeration represents more than 60 percent of a grocery retail store's energy usage. The adoption of ambient dairy products is one way retailers could address this issue as they explore more energy-efficient practices and technologies.

4. Build relationships to further innovation.
To generate success across the supply chain, retail relationships need to move from simple transactions and sales-based discussions to engagement about core design concepts with competitive advantages. The key is establishing communications earlier on in package development to bring best practices and innovative business ideas to fruition. But are we ready for this type of relationship now?

Yes. While different business goals and customer targets can make this type of relationship challenging to navigate, the move is a necessary, but gradual one. By approaching this type of interaction holistically, packaging providers can provide counsel that will increase the innovation pipeline and competitive edge for retailers.

Packaging companies such as Tetra Pak increasingly find themselves in the position to encourage a collaborative dialogue among retailers, suppliers and manufacturers. Whether it's a brainstorming session or an open forum, open lines of communication will eventually pave the way for achieving better business results — not the least of which for retailers is a leg up on the competition.

Suley Muratoglu is vice president, marketing and product management for Tetra Pak Inc., a food processing and packaging solutions company with U.S. headquarters in Vernon Hills, Ill. He is responsible for expansion of the company's presence within core categories, including dairy, beverage and food. Contact him at Suley.Muratoglu@tetrapak.com or 847-955-6000.