Top 5 trends in Packaging Industry

Consumers today are more conscious and more aware. They care not only about the product they need, but also how using that product is made more convenient for them. And packaging plays a very important role in that. The primary reason of packaging always has been the protection of the product that is being delivered. But today packaging does a lot more than that. Packaging is used as a canvas where the brand communicates with the consumer. It not only attracts the customer, but based on the information that is printed, the material that is used for packaging and the shape and size of packaging; it conveys your brand values to the customer. It tell the customer what your brand stands for, creating a unique impression about your brand, even before your product has a chance to be seen by the customer. Needless to say, packaging in itself has become a key differentiator.  Here are some of the top trends in packaging industry.

  1. Sustainability: Consumers are becoming increasingly aware of environmental issues. They are changing their buying habits to be more environmental friendly. They are increasingly looking for signs on the packaging that manufacturer has a green conscience and increasingly wary of greenwashing. And expert white paper by PWC goes on to explain how sustainable practices have become essential to the perception and identity of the brand. A top sports company has also produced an environmental profit and loss statement highlighting the impact of their sustainable practices on environment, in dollar value. It has become imperative that brands continue to carry businesses based on sustainable practices and also communicate them to the consumer. Sustainability is no longer just an add on. It has become an essential part of the packaging industry. The complete story of where the product comes from, how it was made, is becoming an essential factor in buying decisions of the consumer.
  2. Healthy living: Just like environment, consumers are increasingly adopting healthy lifestyle and practices. They are more conscious of health quotient of the products they consume. In fact there is a whole segment dedicated to products that promote healthy consumptions habits. Packaging is not immune to this. In food and beverage industry, the ingredients’ were always listed as required by regulation. But that is no longer enough. The health benefits of the product also need to be communicated to the customer. Is it organic? It is low in sodium, does have daily dose of essential vitamins that will help to boost the performance while playing the sport? The packaging must focus on communicating the unique benefits of the product and offer transparency in the label. Innovative methods of preserving and displaying fresh food will become the key to long term success. The size of the product, the smaller servings for snacks, which reduce the  intake of sodium, fat and other things to just the required amount, while satisfying the hunger pangs of the consumer will become standard. After all when you are hungry you reach for the box says cookies even if it’s just 2 cookies inside.
  3. Convenience: The way the products are being used by the mobile consumer is very different than how it was consumed at home. The standard box packing of food is not longer suitable for on the go consumption. Be it a beverage, or a sandwich, more and more people are consuming these while walking, or while driving, or when they are simply sitting on the bench in the open park. The design of packaging makes it an important factor in a buying decision is such cases. The smaller, lighter and easily disposable packaging makes the consumption on the go, easier. For other product categories, the ease of transportation and ease of use becomes important factor. Innovations such as dispensers and no mess applicators eliminate the need for additional packaging and make disposal easy. In supermarkets, in food section, many product now coming in reseal able packs. Many producers are moving from plastic to paper based packaging for food items, which is more environment friendly and easier to dispose off. When the competing products are more or less similar, the convenient packing goes a long way in aiding the impulse purchase decision of the consumer.
  4. Cost –effectiveness: This one seems to be a no brainer. However, it has wider connotation than just base packing. Global economic uncertainty is increasing. Consumers don’t want to pay more than what they have to for their goods. And as consumers get savier, they are looking at all costs, the base packing of the product, the transportation, storage and disposal of the packing material. The paper based packaging may look good and meet initial ‘eco friendly’ criteria, but if the consumer needs additional packaging for its transportation and storage, then it’s no good for the consumer. If the packaging is strong and will last longer, much longer than the product itself, again it is of no good to the consumer, if it cannot be reused in some way at home. If consumer is getting his peas in reseal able bags, which he can use for storing other things, after consuming peas, then that’s a very good value proposition for the consumer. The complete cost effectiveness of packaging should be looked at from the point of view of the consumer. After all if he doesn’t purchase the product, the whole value chain is pointless.
  5. Authenticity and trust: There have been several scandals around food industry. Discovery of undesirable meat (eg. Meat of another animal in beef products), Pathogens and foreign elements and inorganic items being sold as organic etc. These deplete the consumer trust for not only the guilty producer, but also for industry as whole.  The origins of the product must be traceable to the source to re establish the trust. Advertising the place of origin on the packaging increases the perception of credibility and authenticity. Packaging should be used to reassure the customer of high quality and truthfulness about product and brand claims.

The retail market is changing. Consumers are getting savvy, more eco friendly and more cost conscious than before. They are more demanding on all these fronts. They now understand that the overall cost of the product is not just retail purchase price they pay. Packaging plays an important role to clam the customer and reassure them that the product as a whole will meet their expectation.

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Benefits of Eco-Conscious, Sustainable Packaging

As your business grows, so do your packaging requirements. More the products sell, the more packaging material is used. This gives you an opportunity to use your packaging wisely to your advantage as well as your consumer’s. A third very important view would be using your packaging for the benefit of the whole world. After it has served its purpose, which is, deliver the product to the customer, Packaging of a product generally becomes waste. As a responsible citizen of the word, everyone including your business should be looking to reduce waste. If you are not already, you should be looking for sustainable packaging solutions. They be called environmental friendly, Eco-friendly or sustainable packaging, but the basic principle is same, that is to reduce the consumption of resources used for packaging the product. PricewaterhouseCoopers conducted a study to understand the impact of sustainable packaging on the industry. Detailed report can be read here. As per the report, the pressure for sustainable packaging will continue to increase on the industry. There will be regulations that the industry will need to follow to ensure sustainability. The industry also needs to be more proactive to define what makes a packaging sustainable and how the sustainability should be measured.

 

So, what is sustainable packaging?

While there is no single definition or description that is accepted globally, sustainablepackaging.org has tried to describe what constitutes sustainable packaging. The key elements of sustainable packaging are

 

  • It is safe & healthy.
  • It meets market criteria for performance and cost.
  • It optimizes the use of renewable or recycled source materials and uses renewable energy.
  • It is physically designed to optimize materials and energy required for manufacturing the packaging.
  • It is effectively recovered and utilized in biological and/or industrial closed loop cycles.

 

Sustainable packaging is not only socially desirable but has business advantage as well. Let’s look at some of the benefits of adopting sustainable packaging.

 

Marketing Advantage/Reputation Boost. This is the one that has direct impact on your top line. Businesses that use environmental friendly practices generally have more favourable image in the market place. Increasing number of consumers are becoming environmentally conscious. When a brand makes an investment in environment friendly practices, it not only boosts its image amongst existing customers, but also gains new customers who are concerned about the environment. When customers, see a firm making a firm commitment to the environment, they want to support that brand. Most of the environment conscious consumers are very active on social media and social media, today, is a very important marketing platform. Imagine the kind of free advertising that you will get when these people talk about your brand. Moreover, many NGOs and Government agencies publish list of preferred companies or highlight the companies that have demonstrated the commitment to sustainability. The consumer activists are always looking at these sources and share their leanings on social media. Moreover, the newer sustainable materials increase the shelf life of many products, keeping them fresh for longer. (think cling film for vegetables) Many customers feel less guilty throwing away the packaging as it is now sustainable and doesn’t contribute to pollution (at least not to a very high extend).

 

Reduced resource consumption. Increasingly the companies that use recycled or sustainable options for packaging are discovering that it also comes with an added cost advantage. It is one of the known facts that sustainable packaging focuses on recycled material which leads to reduced consumption of precious, non-renewable resources. Redesigning the packaging to use lesser material and more compact shape helps in further reducing the use of that material. The key objective here is to reduce overall resource consumption, by reducing the amount of packaging used and reducing the energy used to produce them. Compact shapes translate into lesser space used for transporting, translating into more products being transported for same space and thus reducing the fuel or transportation cost. Given these facts, the investors and analysts have started loving the sustainable packaging options.

 

Reduced Storage. As discussed when using sustainable packaging, one the key objective is to reduce the amount of packaging used. Smaller packaging means reduced storage requirements leading to smaller bins and smaller warehousing requirement. This leads to savings in logistics not only for the supplier but also for the consumer. (Consumers need smaller space in their homes to store the product). Subsequently, the sustainability also helps by increasing warehouse productivity and reduces labour costs. Sustainable packaging also helps in disposing off the empty packaging/packaging. Smaller packaging is always easier to dispose and not to forget, it is easily processed (being sustainable). This reduces the overall disposal cost of packaging material.

 

Corporate Social Responsibility (CSR). Today, every business is required to do CSR activities. Be it reduced energy consumption in terms of heating, cooling or electricity, water, paper and other resources. Sustainable packaging furthers that cause and can be used to present the company as socially responsible one. You help reduce the carbon footprint of not only your company, but also that of your customers, your logistics providers and society at large.

 

Thus, sustainable packaging is a must that companies need to focus on; both for environment and their own benefit.