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Plastics Today: Omnichannel Retailing is Changing the Packaging Landscape

By: Craig Robinson, Global Vice President of Business Development and Innovation, PTI

The pandemic has accelerated the shift toward e-commerce purchases. Is your package up to the challenge?

The past five years has seen a continual consumer purchasing shift toward e-commerce and away from brick and mortar stores. However, what was supposed to be a slow and steady trajectory upwards has turned into a meteoric rise due to pandemic shopping habits.  We’ve seen projections as high as 40% to 50% of purchases currently done online versus pre-pandemic, low double-digits. Many feel those high numbers are here to stay. On a parallel path, the term “omnichannel” fulfillment has been gaining a foothold. Retailers are being challenged to provide their customers with a seamless purchasing experience regardless of where the product is being shipped from. The objective is to make the right packaging choices which will positively impact quality, speed, shipping costs and the all-important customer. From a packaging perspective, that’s easier said than done.  In some cases, companies may be shipping from various locations including manufacturing facilities, distribution centers, retail stores, fulfillment houses, etc. What is a desired consumer experience in a retail environment, may not work at all in e-commerce distribution. For example, the brand owner’s goal typically has been to create differentiation for their product at the retail level. With regards to the primary container, such as a ketchup bottle, creating a distinctive shape that would facilitate dispensing was the objective.  Label types and graphics were also part of the brand equity, as well as dispensing closure functionality. When the mode of transport from the store shelf to the consumer’s home is usually a shopping cart and the trunk of a car, there is no need to further engineer the container. However, an omnichannel approach to retailing is changing the game permanently. Now, when a consumer places an online order for that bottle of ketchup, the bottle could be coming from any number of stocking location types. It could be part of the retail store’s local inventory, or it could be coming from a distribution center.

Regardless of the location, that bottle will now have to be placed in a corrugated case or padded bag for home delivery. Invariably that means that the bottle — now separated from the carefully protected partitioned 12-count case load — will be subjected to a bumpy journey via truck, postal vehicle, car, etc. before it gets to the consumer’s home.

Five omnichannel considerations.

Because this is topic could never be covered in a handful of paragraphs, our objective with this blog is to simply create “food for thought.”  Here are some considerations that should be part of every packager’s dialogue.

  • Primary package needs to be more durable to accommodate vigorous shipping environments.
  • Is there a volume set point where two designs make sense, one for shelf retail and one for e-commerce, or should one package be all things to all consumers?
  • Amazon demands are driving more efficient shapes, less weight, and a move towards refillable products. Plus, glass breaks and metals dents.
  • How is your omnichannel package being informed by your sustainability goals including post-consumer recycled content, barrier and color objectives, as well as recycling commitments?
  • How are resin supply pricing and availability impacting package design decisions? For example, recycled PET (rPET) supply and quality has been disrupted due to COVID-19 while prices for virgin PET and high-density polyethylene (HDPE) resins are at historical lows.

In addition to these considerations, the other critical driver that will determine success and failure is how brand owners communicate internally.   In an environment where functions within a brand owner are increasingly “in a silo.” that means that decisions are being made by one department without consideration of how another will be able to execute.  For example, if marketing pushes a design purely based on aesthetics, but doesn’t consider if it can be produced or filled with any level of efficiency (or at all), the end result will likely be disastrous. In order to create next generation packaging that will be successful in omnichannel retailing, it is critical that all functions including marketing, packaging, production, operations, procurement, etc., are aligned in the process. Author: Craig Robinson, is the Vice President of Business Development and Innovation at PTI. He has decades of experience in integrated marketing, concept development and sales management in packaging and branding.

About PTI: PTI is recognized worldwide as a major resource for preform and package design, package development, rapid prototyping, pre-production prototyping, and material evaluation engineering for the plastic packaging industry. For more information: www.pti-usa.com.