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News

E-commerce shakes up the packaging world

Posted on November 21st, 2018 in News

The rise of e-commerce is disrupting the way packagers operate, according to a report authored by Donna Ritson and commissioned by  PMMI, the Association for Packaging and Processing Technologies in the United States, which found that 96 per cent of  people surveyed with internet access had made an online purchase.

In the 2018 E-commerce: Think Inside the Box report, Ritson, owner and president of DDR Communications, defined e-commerce as any type of business that involves the transfer of information across the internet.

“E-commerce allows consumers to electronically exchange goods and services with no barriers of time or distance,” Ritson said.

“Boundaries between conventional and electronic commerce will become increasingly fluid as more businesses move sections of their operations onto the internet.”

Brick-and-mortar retailers are quickly turning to e-commerce in response to pressure from the rapidly growing sector, with 65 per cent of brand manufacturers now selling products online and a third selling direct to the consumer.

The market is expected to expand from more than $4bn currently to $650 billion by 2020.

“FMCGs are coming up to speed as quickly as possible to understand the complexities that e-commerce demands in order to make the best decisions now that will guide them long term,” said Ritson

The report uncovered a huge paradigm shift in the packaging industry as a result of e-commerce’s success, with consumer demands for speed spurring multi-channel development working towards the goal of one-hour delivery. “E-commerce is not only changing the rules of the game, it’s starting a whole new game,” said Ritson.

One executive quoted in the report, a vice-president of packaging research and development, said that this fast-turnaround culture is a major factor in how e-commerce is shaping the packaging industry.

“The on-demand satisfaction consumers want from e-commerce shopping is driving the need for new manufacturing practices, packaging changes, and ultimately equipment advancements,” the executive said.

According to the report, packaging for e-commerce is a fundamentally different proposition to packaging for retail, with 95 per cent of consumers saying packaging significantly affects their online purchase experience. First impressions matter: the “unboxing” trend can spur brand loyalty and encourage repeat business.

“Think inside the box with personalisation, unique designs, or functional enhancements,” Ritson suggests. “For example, using augmented reality to deliver a personalised message to the consumer, or simply a note of thanks.”

Packagers are advised to think differently when it comes to capturing opportunities in the global e-commerce marketplace – thinking in units rather than cases, for example, with the primary package carton also doubling as the shipping container for larger consumer goods.

“Imagine a returnable consumer tote system, similar to milk delivery 50 years ago, delivering a tote of new products and retrieving the empty tote,” said Ritson. “FMCGs are evaluating solutions to increase efficiency; for example, digital print-on-demand, single product wrapping, flexible packaging, and minimising product leaking.”

Sustainability should also be a key focus, Ritson advises, as the responsibility of waste disposal now falls upon the consumer. “Build the carton to fit the products being shipped. Avoid the need to fill empty space, which increases packaging waste and kerb-side recycling,” Ritson says.

The full 2018 E-commerce: Think Inside the Box report from PMMI is available at http://pwgo.to/3784