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Last week found me in Niagara Falls, Ontario for the PAC Consortium’sPAC to the Future” conference. Every two years, the PAC Consortium hosts a conference about packaging and this years’ edition was focused on innovation and future trends. The conference brings together people who make packages, people who design packaging, retailers, service providers, and (vitally) the brand owners who buy all this packaging.

Personalization and customization

The conference kicked off with a big-picture session by Rotman / OCAD University’s Alex Manu, diving into how technological innovation shapes behaviour, and how those behaviour shifts are reflected in the products we buy.
Next were sessions on how new technology like digital presses and smartphones are changing packaging. Digital printing lets brand owners create special one-offs or unique print variations on an individual SKU. One example is a beer company that runs 13 different can prints for its one variety of beer, so that consumers can mix and match cans to spell different words (each can is printed with different letters, two per can). Another example is Coca Cola’s successful “Share a Coke” campaign, which saw stores flooded with Coke bottles labelled with peoples’ first names. Walker’s, a potato chip company let people design a chip bag with their own message and they printed and filled it for the customer.
Augmented reality is another trend that is driving packaging innovation; the technology is finding a home as an enabler of interactive promotions and brand experiences.
These technologies (AR and digital printing) are now being used for promotional purposes. But, down the road (like in the beer example) they may be more central to the product or brand itself, and may become embedded in the brand’s business model. Brands that think through the implications of digital printing and AR, focusing on the impacts these technologies will have on consumer behaviour, may be positioned to discard a lot of the traditional look and feel of packaging and innovate something new and exciting.

Retail channels – no growth in mainline grocery

Conventional grocery (i.e. Kroger, Sobeys, Safeway) is the bulk of sales volume for food and CPG. But there is no growth in those channels. Growth is coming from dollar stores (i.e. Dollarama), convenience stores (Mac’s Milk) and club stores (Costco). Selling in these stores often demands a different approach to package design and product format or size. Conventional grocery stores (like a Kroger or a Sobeys) are squeezed between premium stores and discounters. Discounters come in two flavours, a hard discounter like Aldi and a soft discounter like Wal Mart. Shoppers who try the discount channel are now staying there even when their incomes improve, meaning conventional grocery loses out even as the US and Canadian economies strengthen. And premium stores like Loblaw Great Food or Whole Foods are encouraging consumers with money to spend to splurge on new experiences. Meanwhile, so-called “ethnic” stores and club stores are competing at every level of the market from premium to discount. And that’s not even taking into account the rise of online grocery, which is fast becoming mainstream as grocers solve the problem of home delivery and innovate “Click and Collect” pickup points.
Food and CPG brands large and small must have a multi-channel strategy that optimizes their packaging to succeed in multiple sales channels. Risks around devaluing the brand can be mitigated by sub-branding or innovating special features or packaging formats.

Sustainability’s next step and the circular economy

Sustainability continues to be top of mind for packaging users and designers. The concept of the “circular economy” provides a map and goal for sustainability-minded organisations. For more information, visit this explainer.
In brief, the concept is that the waste from making a product should go back into the system as the input for the next cycle of products. Governments in Canada are interested in this idea and Bill 151 (the Waste Free Ontario Act) is inspired by it.