Package design was originally introduced with the core purpose of protecting the content of goods during their transportation and sale. Decades later with the expansion of product choice, brands have learned the importance of effective packaging design and how it can be used to achieve growth in a competitive marketplace. One of the ways to achieve this is through smart packaging. But, what is smart packaging?
In this article, we will talk about the concept and different types of packaging. These are active, intelligent, design-led, and connected packaging. We will also address the benefits that smart packaging can create for brands, some of the challenges it faces, and opportunities in terms of future trends.
What is smart packaging?
Smart packaging refers to the package that links the physical world with the digital world, connecting retailers, manufactures, customers, and digital channels. By utilising new technologies to become more than just a mere container, allows packages to be more communicative, dynamic, individualised, and actualised.
One example would include ink that changes colour when a product’s content is ready to consume or is about to go rotten. Pretty cool, right? More and more CPG brands are using smart packaging to communicate to their consumers that they understand their needs and want to address them.
Types of Smart Packaging
Smart Packaging is an umbrella term that could be used to describe different types of packaging as the following:
Active packaging utilises a variety of advanced materials to provide functionality like thermochromic, temperature, moisture, and even bacteria control. This helps to improve the product’s shelf life or its contents’ quality during storage.
Such active substances can be incorporated into the packaging or added separately in the form of inserts. For example, if we add oxygen absorbers to the cap in a plastic beer bottle, it would extend the shelf life from three to six months.
For more examples, we can just observe the closed food pads from Cellcomb, a Swedish company that develops eco-friendly, disposable, laminated products for conditions with high demands on hygiene, safety, and comfort.
These different pads absorb excessive moisture and liquids and release carbon dioxide (CO2) in food packaging, maintaining the gas composition and prolonging shelf-life.
Intelligent packaging offers an additional benefit that goes beyond mere packaging, which is communication. It involves indicators and sensors placed inside or outside the packaging that diagnose product conditions, providing information about its status. This would include temperature, storage time, tightness, and freshness, among others. One example would include that food packaging may change colour to indicate an interruption in the cold chain, salmonella contamination, or leaky packaging.
Furthermore, intelligent packaging fulfills marketing, automation, customer engagement, and protective functions through augmented reality, barcodes, loudspeakers, LEDs, NFC, or radio chips, among others. For instance, an intelligent medication packaging designed with tiny loudspeakers, LEDs, and RFID chips could register the removal of pills and sound an alarm if users do not take them correctly or will notify their doctor.
Design-led packaging is a type of packaging design that enriches the function and form of a product, supporting its value perception and enhancing the user’s experience.
As an example, Pill Pack, an American online pharmacy that packages and delivers users’ medications, sends products in easy-to-open and convenient packets that are customised to each consumer.
Not to be confused with smart packaging, as we saw before while discussing its future and connected packaging.
As its name indicates, it allows brands to “connect” with their consumers through packaging that integrates technology like tags, QR codes, or sensors that can generate and collect third-party data that would provide them with a deeper understanding of their consumers’ behaviours and as a result, optimise campaigns.
Connected Packaging allows brands to add real value to their user’s lives, transforming packaging into interactive brand tools and creating meaningful experiences that would stay on the top of their minds for quite a long time!
Apart from driving sales and in-store footfall, it is also an essential tool to drive awareness and boost education among consumers on a brand or product’s unique position and messaging through gamification. Some illustrations would include a brand’s new products or their commitment to a specific Corporate Social Responsibility program. Let us illustrate the concept of connected packaging with Tetra Pak!
To fulfill Tetra Pak’s objective to spread awareness of recycling and promote its sustainability, we generated a mobile quiz about recycling and Tetra Pak’s environmental impact. Users could access it through QR codes printed on the packages.
If they gave a correct answer, then a tree would grow in the game. As a result, Tetra Pak’s consumers managed to answer 19,000 questions and raise 750 trees together. For more examples of Connected Packaging, check our Case Study Gallery!
What are the Benefits of Smart Packaging?
Now that we have seen what smart packaging is and its different types, let's take a look at what it can do for your company.
Smart Packaging Protects products’ content and enhances their shelf-life
Extending the shelf-life of the products is one of the significant concerns for all the brands, and as we have observed before, smart packaging designs can adjust themselves by the ambiance outside and inside the package, preventing and repelling moisture, bacteria, or other dangerous agents, the consumption of potentially unsafe food, and reduces the need and costs to discard out-of-date or damaged goods.
Smart Packaging encourages Quality control
Products need to be transported and delivered under strict environmental conditions and even though providers make use of data loggers, this kind of information can not be available in real-time. Also, it is often not handed over to the manufacturers until after the products have been sold to the consumers, which could consequently negatively affect the brand reputation.
However, smart packages can monitor the condition of a product and notify whether it is good or compromised by the use of advanced indicators and sensors, offering providers easy access to quality control.
Smart Packaging helps protect against theft, substitution, and counterfeit-proof goods
Unfortunately, many manufacturers, especially in cross-border trade can be potential victims of counterfeit, product substitution, and theft, and given the delay in information and reliance on humans to report back on the status of products, it’s tough for them to keep track of their products, know where the issues took place and communicate legitimacy to customers.
It’s a complex problem for any business to capture a customer’s order once they run out of a product. Thus, smart packaging solutions allow manufacturers to predict when goods may be running low automatically, and to communicate with users, asking if they would like a replacement.
Smart Packaging empowers consumers
Smart packaging solutions offer an advanced customer interface, providing them with additional information on nutritional values, dietary concerns, sourcing, etc., through implemented smart codes like QR codes, that can help them in making informed purchasing decisions. Let us give you an example!
When Swiss dairy company Emmi wanted to be one of the first on the market to engage with consumers digitally, while educating their key audience about the nutritional benefits of their products range and their new Emmi Good Day milk drinks, in Appetite Creative we came up with the best smart packaging for them.
The solution? We implemented QR codes on the packaging of Emmi’s good day products and once consumers scan them using their smartphones, they can play any of 4 interactive games. These digital games were played a total of 45,897 times by more than 35,500 users during the months the campaign was live.
Further, market-style questions such as “Are you actively avoiding sugar in what you eat and drink?” were answered more than 50,000 times, helping customers learn more about the natural ingredients of the Emmi good day products.
Smart Packaging helps you to stay relevant
Tech-savvy consumers are now looking for unique, innovative, interactive, and personalised experiences and forms of technology.
That’s why smart packaging gives brands a higher chance of staying relevant in the users’ life when they engage with these platforms, having the opportunity to connect with existing and potential customers and avoiding being labeled as technologically outdated.
Smart Packaging encourages brand Transparency
Now that more and more consumers are demanding more transparency, better ethics, and sustainability from brands, smart packaging offers an innovative solution to meet this need.
Through the implementation of QR codes, for example, customers can learn more about where product materials are manufactured, by whom, the brand’s story and initiatives, etc. As a consequence, brands can build a meaningful connection with them and be portrayed as a more ethical brand.
What are the Challenges of Smart Packaging?
Despite the increase of smart packaging in the packaging industry, multiple challenges lie in the way of it becoming a complete “must” for the majority of companies. Let’s break them down:
- Commercial challenges: A better packaging comes with a higher cost. Smart packaging solutions are not cheap compared to standard packages.
- Legal challenges: Since its regulation is not fully developed, aspects like consumer data collection and manipulation could create conflictive situations in the future.
- Technological challenges: As smart packaging depends on technology, one could say that it would become “smarter” as technology advances.
- Organisational challenges: Since it is a solution that collaborates with different organisations, including the brand, product manufacturers, delivery companies, material and technology providers, and the client, among others, there is not yet a perfect process that considers how these agents work to create and maintain an effective ecosystem of partners.
What are the Future Trends of Smart Packaging?
Here at Appetite Creative, we believe that there is no doubt that smart packaging will keep evolving in the coming years as new technologies continue to be studied and researched. Here are some trends we foresee:
Is Smart Packaging Sustainable?
Sustainability continues to be a key trend within the packaging sector, as we have seen previously, consumers are looking for more eco-friendly purchasing experiences. Thus, more and more brands are turning to more sustainable options from their good’s production to the way they are packaged. Brands can use it to show their products or positing are making strides for a better planet while being transparent.
Counterfeiting and Authentication
The Covid-19 pandemic has created new opportunities for counterfeit products to proliferate, becoming a significant issue that companies need to address since it affects revenues and could lead to high health risks.
Smart packaging offers the best solution as it can act as an authenticator for consumers and supply providers via smartphone. That would mean that when a user buys a product, they can tap the package to their phones to authenticate it.
Is Smart Packaging the right solution for my business?
Since current smart packaging solutions are generally divided into customer engagement, traceability, and anti-counterfeit, we foresee that brands would increasingly look for providers who can deliver a complete solution rather than one that only focuses on the areas mentioned above.
Big data and data visualisation
Considering the rise of big data coming from smart packaging, we believe that there will be a solution to visualise it so providers, manufacturers, and brands can easily interpret it. In addition, we predict that manufacturers will hire more data scientists to use this big data to optimise supply chain processes.
We can conclude that smart packaging connects the physical and digital worlds, acting as an open flow of communication between brands, manufacturers, providers, and consumers with digital and memorable experiences that make packaging more communicative and personalized. With new technologies and trends breaking into the world of FMCG and packaging, now companies need to think outside the box and adopt new solutions that set them apart from their competitors. That’s where we step in.
Here at Appetite Creative, we are experts in creating connected experiences, the most creative and innovative solutions that help brands to step up their packaging game, tailoring solutions for their specific goals. Just ask our clients like PepsiCo, Tetra Pak, and Bacardi! If you are interested in taking your packaging to the next level, showcase your brand as a digital forerunner, or are ready to learn more about smart packaging, then don’t hesitate to contact us!