Happy Packages. Happy Customers. – LogiSYM November/December 2017

Happy Packages. Happy Customers. – LogiSYM November/December 2017

In the competitive business world we live in it is no surprise that personalization and customization were two of the leading trends to come out of the National Retail Federation’s annual trade show in January 2017 in the U.S Even the recent Seamless 2017 event held in Singapore had a big section dedicated to how to master the ‘me-commerce’ – adapting the online shopping world to meet individual customer needs.

Introducing the “Last moment of Truth” – research shows that packages play a crucial role in how customers perceive your brand and drive future purchase behaviours. The last moment of truth is where expectation meets experience.

As e-commerce dominates the retail landscape, secondary packaging to get items to the customer is more important than ever. All the fleece pullovers, Fitbits, and K-cups you order online have to make their way to your home somehow.  That journey can be smooth and easy or fraught with damage. You won’t know which path your parcel took until it shows up at your doorstep. Pass or fail?

Though free shipping and delivery speed are paramount to online shoppers, they are also concerned about damage. Fifty-eight percent of respondents in a Sealed Air e-commerce survey said their relationship with the retailer would be negatively impacted if their online order was damaged. Thirty-eight said they would consider purchasing from a competitor and 20% would never use that retailer again.

From the packaging side, a lot goes into making sure these e-commerce orders not only pass the delivery test but also build brand awareness, enhance the customer experience, and strive for sustainability. Myriad factors are influencing the packaging industry, which, driven by robust e-commerce, is constantly seeking to develop new solutions and strengthen existing ones to keep up with consumer demand.

When it comes to the corrugated box, you can color it, put a logo on it, or try to disguise it in some way but it’s still just a box. Important as it is, the main purpose of the box is to serve as a vessel for transporting products from point A to point B. It’s what’s inside the box that differentiates the company that sends it. Apart from the actual product arriving fully intact and un-damaged, customer experience in unboxing the product has become just as important. Boosting the customer experience by delighting the senses or adding an element of surprise goes beyond expectation and elevates the brand in the mind of the consumer.

In fact, Kantar Retail research study conducted for Sealed Air revealed that positive impressions of premium packaging resulted in 78% of respondents having a better perception of the retailer and that 68% of customers credit the retailer rather than the shipper for their good experience with the packaging.

On the flip-side a negative impression of damaged packaging resulted in 70% of shoppers who considered not reordering from the company again and 8% actually no longer ordered from the company.

Overall, 77% of shoppers believe that packaging reflects a company’s environmental values, care for the customer and resulted in a much better brand experience.

As a result of the above research conducted by Sealed Air, here are five key packaging predictions we are making for 2017:

Clever Customization: As the in-store experience erodes, the at-home experience will explode and the all mighty customer experience will soon occur straight out of the box. Undamaged, quick deliveries are now an expectation not an exception so customized secondary packaging will become a game changer for brands and retailers. Expect innovative direct-to-consumer startups such as razor maker Harry’s, handbag seller Dagne Dover, and home goods company Snowe to disrupt more traditional consumer packaged goods and leverage packaging customization as a means of differentiation.

Corrugated Crunch: Boxes have been the traditional vessel for transporting consumer goods but as the cost of corrugated continues to increase, warehouse space to store it shrinks, and changes are taking place in the waste streams for recycling it, retailers are rethinking the box. In addition to the resurgence in padded mailing envelopes, look for retailers to use more custom box sizes rather than stock, and to seek ways of strengthening the primary package for delivery, which eliminates the need for a secondary corrugated box. Expect more companies to invest in automated solutions that don’t eliminate the box altogether but instead enhance its capabilities and give companies the ability to build a box that meets particular design specifications.

Dimensional Weight Strain: Dimensional weight is the weight assigned to a shipment based on volume versus actual weight. Implemented in 2015 by major carriers, this pricing structure is expected to continually increase as rising e-commerce makes interior truck space more valuable. To combat these carrier fees, shippers will have to reconsider secondary packaging materials and methods and make immediate changes that will result in smarter and smaller secondary packaging.

Micro Fulfillment: The surge in niche micro companies is proving that when it comes to retail, bigger isn’t always better. As we move to a more personalized economy, businesses that provide singly focused, creative services and products are becoming more popular (think craft breweries). For micro companies that exist solely as digital storefronts such as Etsy, eBay, and Shopify proprietors, fulfillment will become a challenge as consumer traffic increases and buyers expect the same type of damage-free, fast deliveries they receive from larger retailers. Since micro retailers are operating on a small scale with few employees and limited space, they will need to rely on companies such as Shyp, which provide small businesses with on-demand packing and shipping services via an app.

Less EPS: The days of piling on the packing peanuts are coming to an end. Not only are package recipients complaining about the mess created by loose fill in their homes, but sustainability factors and end-of-material-life options are also driving companies to eliminate the use of expanded polystyrene (EPS), commonly known as Styrofoam. Seeking affordable solutions that provide similar damage protection and recyclability, more shippers will turn to inflatables for securing and protecting items during transit. Air-filled plastic can provide blocking and bracing capabilities without the baggage that comes from foam.On paper, the appeal of brick-and-mortar shopping is still quite obvious: the elegant displays, the ease of returns, the individualized attention, or the serendipity of discovering an in-store sale.

But with consumer browsing now happening on the internet, retailers struggle to recreate that same tactile, immersive, “sticky” brand experience at home.

Most retailers settled for “good enough” e-commerce strategies because it was believed that physical stores would continue to serve as the gold standard for brands, but now companies are finding it hard to count on store loyalty alone to keep customers shopping online.

Most have tackled this challenge with a barrage of deals, discounts, flash sales, and loyalty programs designed to attract those critical online clicks, but those retailers that think the hard work is done when the customer checks out online are missing a critical opportunity to expand the store brand experience into the home.

Custom printed packaging, personalized messages, in-box promotions, effort-free return processes, and unexpected surprises can maintain brand fans who receive most of their purchases at home. Even better? They’ll tell others. Forty percent of consumers say that they’d share a unique packaging experience on social media.

Pasi Pesonen

Pasi has been with Sealed Air Corporation for 26 years and is now leading the Product Care business in Asia Pacific as Vice President for the region. He first joined Diversey,currently a division within Sealed Air, in Finland and has since lived in six different countries, successfully serving in several local clusters in Marketing, Supply Chain/Logistics, Sales and General Management roles.

He has an extensive professional and leadership track record with broad business experience. Among others, he has been the Finnish Marketing and Supply Chain lead, Managing Director Finland and Sweden, Global Customer Management Excellence, and Global Sales Operations Lead. He also held positions as sales lead for North/East Europe and was the Vice President of Diversey Care, East Europe before he moved to Singapore in 2015 to lead the Product Division in Asia Pacific.

Pasi has a Master’s Degree in Food Science (economics & marketing)

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