Is Connected Packaging Right for Your Brand?

By Jenny Stanley

In today’s rapidly evolving digital marketplace, brands are constantly seeking innovative ways to engage consumers and stand out. Enter connected packaging, a revolutionary technology that transforms traditional packaging into an interactive, data-rich platform. But how do you know if it’s right for your brand? Let’s explore the key reasons to consider connected packaging and how to evaluate its potential for your business.

 

What is Connected Packaging?

 

As I defined, in my recently launched book ‘Connected Packaging: The Game-Changing Marketing Tool’, connected packaging uses technologies like QR codes, NFC tags or augmented reality (AR) to link physical packaging with digital experiences and data systems. This creates a bridge between the physical and digital worlds, opening up a wealth of possibilities for brands and consumers alike.

 

The Rise of E-commerce and Retail Media

 

Before diving into the benefits of connected packaging, it’s crucial to understand the current retail landscape. According to Emarketer, 20.1% of retail purchases are expected to take place online in 2024, growing to 23% by 2027.

Shopify predicts e-commerce sales will grow 8.8% in 2024 and IAB Europe forecasts that retail media spending will surpass traditional linear TV in Europe in under two years, reaching €25 billion.

In this context, connected packaging emerges as a powerful tool to enhance both online and offline shopping experiences. So, why should a brand adopt connected packaging? In my opinion, there are six benefits to implementing connected Packaging, these include:

 Increased Sales and Consumer Engagement

 

Tetra Pak claims that connected experiences deliver a 20% increase in sales and at Appetite Creative we have seen campaigns deliver a 30% rise in sales. Connected packaging campaigns regularly generate a 14% scan rate/click-through rate (CTR), much higher than a digital advertising campaign usually around 0.01% CTR. It’s not only impactful, but also cost effective. The average cost per digital advertising click is £1.50, whereas a ‘click’ or scan on packaging is technically ‘free’, giving brands a compelling reason to use connected packaging.

It offers a seamless way to provide product information, exclusive deals, and interactive experiences right at the point of purchase or consumption.

A great example is work we recently delivered for a leading European fruit juice producer, in partnership with Tetra Pak. We implemented a connected packaging campaign that generated over 160,000 scans, 174,000 unique visitors, and an average engagement time of 1 minute 14 seconds.

 

Sustainability and Transparency

 

Connected packaging will continue to play a significant role in sustainability efforts, providing consumers with information on recycling and the environmental impact of products. Additionally, we expect to see more brands using connected packaging to create loyalty programs and offer personalised promotions.

A great example is our recent work with Elopak’s new aluminium-free carton, which Don Simon has started using for its beverages. We were able to raise awareness of the new aluminium free carton, personalise the experience by product type, test customer knowledge and address the gaps and drive sales. All while identifying ambassadors for the brand. We saw an average dwell time of two minutes and 46 seconds, 14% scan rate and 60% registration.

In another recent campaign we worked with Goodday, a cultured milk drink owned by Asahi Beverages Philippines and distributed by Universal Robina Corporation in the Philippines, to build a fun and interactive connected packaging experience. The smart packaging campaign for Goodday drinks offered registered users instant prizes via the web app based connected experience accessed via serialised QR codes. The campaign generated over 13,000 scans, receiving 218,000 unique visitors which saw an average of 1 minute and 6 seconds engagement rate.

 

Consumer Insights and Market Research

 

Connected packaging offers unprecedented access to consumer data through collecting real-time data on product usage and consumer behaviour, to gain insights into regional trends and preferences. It also gives marketers and product development teams the opportunity to test new product ideas or marketing messages.

In the fruit juice campaign mentioned earlier, 40% of users cited quality as the most important purchase consideration, and passion fruit was the preferred flavour for 28% of users.

 

Authentication and Anti-Counterfeiting

 

For brands dealing with counterfeiting issues, connected packaging can be a powerful tool to implement secure, unique identifiers for each product. It allows consumers to verify product authenticity easily and producers can track products throughout the supply chain.

 

Traceability and Supply Chain Optimisation

 

Connected packaging can revolutionise your supply chain management by not only tracking products from manufacture to point of sale, but it allows brands to quickly identify and respond to issues in the supply chain. It can also improve inventory management and reduce waste.

 

Integration with Retail Media and E-commerce

 

Connected packaging dovetails perfectly with retail media and e-commerce strategies to create seamless omnichannel experiences, drive online sales through physical packaging and enhance product visibility in digital marketplaces.

So, how can brands evaluate if connected packaging is the right fit? There are six key steps to inform the decision-making process, these include:

• Identify Your Goals

Consider, what specific challenges are you trying to address? Increased sales? Consumer engagement? Sustainability? Having clear goals will guide your implementation strategy.

• Understand Your Audience

Is your target market tech-savvy and likely to engage with connected packaging? What type of experiences would resonate with them?

• Assess Your Resources

Connected packaging requires an investment in technology and potentially in packaging redesign. Evaluate if you have the necessary resources and expertise.

• Consider Your Product and Sales Channels

How does connected packaging fit with your product type and where it’s sold? Can it enhance both in-store and online experiences?

• Analyse the ROI

While the benefits can be significant, it’s crucial to estimate the potential return on investment. Consider both tangible (increased sales) and intangible (brand perception) benefits.

• Start Small

If you’re unsure, consider running a pilot program on a limited product line to test the waters.

 

The Future of Connected Packaging

 

Industry trends suggest that connected packaging is not just a passing fad. A recent survey we carried out shows that a third (33%) of respondents are planning to spend between $15,000 to $30,000 this year. A large majority (88%) claim to be planning a connected packaging campaign this year. With 80% of respondents citing that connected packaging will be increasingly important to the packaging industry in the next 12 months and beyond.

Connected packaging is more than just a trend, it’s a powerful tool that can transform your relationship with consumers, optimise your operations, and drive sustainable practices. By carefully evaluating your brand’s needs and goals, you can determine if this innovative technology is the right next step for your business in the evolving digital marketplace.

Jenny Stanley is MD at Appetite Creative, for more information visit: appetitecreative.com