Connected Packaging: The Next Big Thing?

Connected Packaging: The Next Big Thing?
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The increasingly complex challenges faced by today’s retail industry have been well documented of late – challenges which are often compounded when exporting.

Brands and retailers need to address rapidly changing consumer behaviours and expectations, as well as respond to the pressures of speedy delivery, regulatory demands and fluctuating exchange rates – just to survive in these unpredictable times.

So the search is on to identify and implement the very best of the latest innovative technology solutions – those which can be scaled up to suit international trading conditions and engage directly with consumers wherever they may be.

One of the routes currently being explored is connected packaging. Here at K International’s Retail Division, we can see some exciting potential uses for our clients, should this become accepted practice…

What is Connected Packaging?

Part of the inexorable move towards the ‘Internet of Things’, connected packaging is a rapidly-growing method of information-sharing.

How it works

An interactive element is added to the buying process at the point of sale via smart devices.  Access to additional information or content enhances the customer experience.

What’s the appeal of this technology for retailers and brands? It can be applied to virtually every consumer product at all price points and across all categories.  According to SmithersPera, the market for connected packaging is expected to grow at least 18% per year, reaching over $2 billion by 2021.

Early adopters in the FMCG sector are relishing the opportunity to be creative.  They are coming up with entertaining ways to develop that crucial relationship with their target customers and to reinforce key brand messages.

Reimagining the Scope of Packaging

Packaging is under more environmental and regulatory scrutiny than ever before. Concepts like connected packaging will appeal if they add significant value beyond the traditional protection and point of sale functions.

The latest research confirms that consumers are more open to an extended role for packaging. So, forward-thinking brands are trialling different ways to assess and realise its potential.

One prestigious champagne brand has, for example, recently developed an intelligent uncorking system.  This system “heroes” its customer offering whilst amplifying the social experience. Here’s how it works. A radio frequency identification chip, triggered as the cork is popped, connects to a lighting and sound system. This throws the spotlight and diners’ attention onto the table which has opened the bottle in celebration.  It’s a great way for targeted consumers to associate the brand with positive experiences and to increase social media activity.

At different price points, other interesting applications are being implemented. Heinz was an early adopter amongst food brands. They’ve used smartphone cameras pointed at their bottles of sauce to allow shoppers to access a selection of recipe ideas using the product. This is a proven way to increase demand.

Space on the Label? Not an Issue!

Can you imagine this connected packaging being used in the future to provide access to all the layers of information demanded both by savvier shoppers and stricter regulating bodies across the globe? We can.

As it stands now, brands and retailers must constantly make compromises on the pack. They have limited pack space to accommodate the amount of copy required.  Often, this results in a lot of information in a font size so small that the vast majority of consumers can’t even read it!

How much better to imagine a clean and clear product label?  One where the brand logo can take centre stage without all those required elements vying for space and attention.  How much more user-friendly if the press of a button called up full product-related information instantly, either with a ‘smart’ button on the shelf or via the customer’s own phone?

Of course, we’re not there yet. Laws would need to change first. Additionally, some sort of provision must be made for customers without devices.

Export Packaging and Endless Possibilities

Another key area which could be enhanced by this technology is the development of multilingual packaging localised to suit the intended markets.

We support brands and retailers exporting products across the globe. As part of this, we adapt monolingual labels into multilingual versions whilst balancing the demands of language, compliance and space against those of clarity, readability and impact…so our Desktop Publishing (DTP) Studio team here are using all their experience and skills daily to create these minor miracles!

We’re now wondering whether the potential of these technologies to advance export packaging, in particular, could lead to the following opportunities:

  • More comprehensive and readable packaging: 
    Relevant and comprehensive data about the product, tailored to suit the local market, using different ways to access the information digitally at point of sale – easy to read and understand.
  • New brand-loyal customers:
    For brands with an authentic tone of voice, both their essential and more subtle messages could be fully expressed in multiple languages without the need for the usual compromises.
  • Commitment to local markets:
    By engaging in this more direct way, brands could demonstrate a commitment to meeting specific cultural needs, are moving with the latest market trends and responding rapidly to changing consumer habits.
  • Greater confidence at launch:
    When approaching new export markets where the brand is not yet established, low-cost trials could be more easily run to test out local market reactions to different products, ranges and brand messages before launching on a larger scale.
  • Keeping compliant:
    With the moveable feast that national and international regulatory rulings have become (and as they are likely to remain for the foreseeable future), connected packaging could be instrumental in keeping products fully compliant.
  • Avoiding costly recalls and redesigns:
    As well as modifications for regulatory purposes, this method could also accommodate recipe changes and other modifications to the copy – without needing a complete artwork redesign and reprint each time anything changes.

Advancing the Sector

In summary, innovative technologies like connected packaging can move the sector forward. They can also help to establish new export markets while building up existing ones. Finally, they allow retailers and brands to steal a march on the competition.

First, the inevitable technology issues and complex compliance questions will need to be ironed out for these kinds of applications. Then,  connected packaging could shatter the notion of distance and build a relationship with customers at home and abroad that is personalised, relevant and on-trend.

What other applications, benefits or issues can you foresee? Any comments welcomed as I’d love to learn more about your views on the subject.