Inside Logistics

Online grocery trend is shaping smart packaging

Research finds packaging will play an important role in response to the trends shaping the growth of on-line grocery shopping

September 13, 2018

Packaging will play an important role in response to the trends shaping the growth of on-line grocery shopping. Recent research by Tetra Pak highlights four key trends influencing the growth of online grocery: Convenience, sustainability, personalization and uniqueness, and technology and performance.

“The rise of on-line grocery is a great opportunity for food and beverage brands, and packaging plays a key role in supporting their success,” says Alexandre Carvalho, director global marketing services at Tetra Pak.

“In particular, smart packaging helps drive greater transparency and efficiency in the supply chain, up and down stream, while also enabling a direct, interactive relationship with the consumer. We believe this rapidly developing technology, tried and tested by us since 2016 and now being deployed in Europe, can help our customers explore new avenues, driving growth in the years ahead.”

Convenience is driving the uptake of online grocery shopping, as time-crunched consumers look for new ways to make their life easier. Opportunities where packaging can make a difference are in easy product replenishment at the DC, voice-controlled picking, and convenient packaging.

Avoidance of single-use plastic and awareness of the circular economy will continue to increase pressure for sustainable packing alternatives. Recycling will become ever-more important. Consumers want to know whether brands are ‘doing the right thing’, and will shop accordingly.

Customization of products and personalization in the consumer journey will be important differentiators going forward. This is accelerating the direct-to-consumer trend and as many as 80 percent of consumer-packaged goods companies are predicted to migrate to this model by 2025.

Urban delivery in as little as 10 minutes is expected by 2025, changing consumer behaviour to buy more frequently and in smaller amounts, adding more complexity to delivery logistics. Supply chains will continue to be transformed by a raft of technologies, notably radio-frequency identification (RFID) and robotics, boosting efficiency and transparency.

Smart packaging technologies based on unique digital codes allow each and every product package to be given a unique identifier. These codes can be read by either data-scanning devices in the DC or an ordinary smartphone or home-based refrigerator or pantry, linking to vast amounts of information and opening up all kinds of possibilities. It creates an interactive channel with individual consumers, allowing brands to have a real time conversation with the consumer, sharing details on the sourcing of raw materials, nutritional facts, as well as games, promotions and environmental information.

At the same time, with insights captured through these digital codes, brands can continuously improve the shopping experience and make it ever more personalized for the consumer.

e-Retailers are also calling for unique identifiers compatible with the robotic technology used in their warehouse and distribution, as this is widely seen as the key to success in e-commerce. Data and full traceability help them navigate complex logistics and improve efficiency, moving closer to real-time order fulfillment.

The Tetra Pak Index 2018 is based on consumer research in the U.S., UK, China, Saudi Arabia and Korea, a global market segmentation study, and interviews with e-retailers in the U.S., Europe and China.