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December 12, 2006
Unwrapping the Packaging Industry
Today's package designers are designing packaging for a new consumer — an on-the-go consumer. Here we parse growing trends that range from portable to flexible to biodegradable packaging, as well as industry machinery expenditures. Also, we look at why manufacturers and consumers are at odds over how holiday gifts are packaged.
AlliedFlex Technologies, Inc. president Dennis Calamusa recently wrote in "Packaging Design, Trends and Technologies," the package is the "silent salesperson" sitting next to the competition.
In today's marketplace, in which global packaging industry sales last year were estimated at $460 billion, functional practicality of packaging, convenience and design are becoming more integral to product packaging.
In fact, it is this convenience, as well as portability and health, that Innovative Consulting recently found to be driving packaging needs. The analyst found that the emerging trend continues to be in convenience packaging that provides additional functionality, such as single-serve products, dual compartments and re-sealable closures.
Today's package designers are breaking from tradition and are designing packaging for a new consumer.
The drive toward more portability in packaging reflects an on-the-go society, and has led to new package forms, especially in the beverages markets but also in cosmetics. Such packaging includes those that allow processors to offer consumers a combined snack and drink in one product, for example.
Moreover, a recent study conducted by IPSOS Public Affairs in the United States found that 34 percent of consumers ranked freshness as the most important factor when it comes to food packaging, ahead of the 24 percent who ranked price higher.
Packagers are also using pre-industrial designs in a bid to arouse consumer desire by creating realistic and warm images that whet consumers' appetite," Europe's Food Production Daily recently said.
The Chinese boom has caused a move from traditional unbranded goods toward Western-style consumer markets, which, as Dr. Benjamin Punchard of Euromonitor International told Packaging Gateway, "can only be good news for the packaging and converting industry."
China represents the world's largest packaging market, fuelled by its population and a dynamic, fast-growing economy. Euromonitor International's research shows that total unit packaging consumption has risen 47 percent since 1998 to reach a staggering 704 billion units in 2005, more than 200 billion units more than the world's second-biggest market — the U.S.
Let's look at some other trends taking place in packaging.
Flexible Packaging
The flexible packaging industry represents an estimated 17 percent of the total U.S. packaging industry and is the second-largest packaging segment within the industry. Unsurprisingly, and following the global trend, flexible packaging holds the dominant position within the Chinese market.
Flexible packaging is utilized within several end-use segments — including retail and institutional food, retail and institutional non-food, medical and pharmaceutical, industrial applications and consumer products.
As a packaging format, flexible packaging offers benefits to the packager including opportunities for material cost-reduction relative to other more traditional methods. The logistical advantage of flexible packaging, Tech Trends' Annual Packaging Solutions Update recently noted, is also gaining attention as the cost of transportation dramatically influences per-package costs due to high fuel costs.
The global flexible packaging industry generated an estimated $21.8 billion in annual sales in 2005, according to the Flexible Packaging Association's 2006 State of the Industry Report. The report focused on the value-added segment of the flexible packaging industry, which generated an estimated $17 billion in annual sales.
Plastic resins, films and sheets accounted for more than two-thirds (69 percent) of the materials used in the flexible packaging industry. Printing within this industry, as of July 2006, was valued at $4.6 billion with converters using an average of seven colors when producing final flexible packaging.
Today there are many flexible package formats and machinery technology options available to the packager, including the ability to install machinery that can produce the flexible package online from roll-stock.
Packaging Machinery
The Packaging Machinery Manufacturers Institute (PMMI) expects an increase in packaging machinery expenditures in six of eight industrial sectors and an estimated $5.5 billion growth in machine expenditures. The PMMI predicts such packaging machinery sales to grow 3 percent this year in the U.S. alone.
The biggest spending boosts are expected to come 
from personal care products (10 percent to 12 percent), followed by beverages (six percent to eight percent), and converters, printers and all others (six percent to eight percent). Food and pharmaceutical/medical packaging should rise slightly, as well.
Sixty-two percent of respondents to the PMMI's U.S. Purchasing Plans Study plan to either increase spending or keep expenditures at the previous year's level.
Sustainable and Biodegradable
Globalization, demand for accountability and transparency, rising energy prices and escalating environmental degradation are but a handful of issues driving interest in sustainability on the part of business and other advocacy groups.
Packaging Digest recently noted:
With the entrance in 2005 of Wal-Mart into the arena, sustainability has hit the mainstream and is impacting almost everyone in the packaging value chain.
Moreover, packaging suppliers over the past year have been introducing various forms of biodegradable plastics made from a variety of plants, based on projections that there will be a growing demand for environmentally friendly packaging driven by consumers and recycling regulations. Many packaging manufacturers have already released biodegradable products.
Some companies predict that the market will grow by about 20 percent per year, as Food Production Daily recently pointed out.
In general, the price difference between materials made of renewable raw materials and standard plastic materials has decreased considerably.
Said Food Production Daily:
Food packagers last year faced price hikes of between 30 [percent] to 80 [percent] for conventional plastics due to the increased cost of petroleum. With the increases, some bioplastics products reached full price competitiveness with the traditional oil-based packaging.
A new trend is the combination of commercialized biomaterials, creating new functional characteristics and special benefits. Other development efforts focus on multi-layer films with altered characteristics that could improve the barrier characteristics of packaging materials, for example.
Unwrapping Those #*@! Holiday Presents
In an effort to keep products intact and safe, the consumer products industry has moved en masse into a style of wrapping that involves a hard plastic clamshell container with fused seams. Manufacturers say molded packaging protects goods en route from Asia. Retailers say the heat-sealed edges keep shoppers from opening them in stores.
Consumers, on the other hand, are driven nuts.
"The vitriol these packages inspire is so rampant the industry has a name for it: wrap rage," recently reported The Washington Post.
As such, manufacturers can no longer ignore the soaring consumer complaints. "They realize it's a problem," Jim Silver, editor of Toy Wishes magazine, told The Post. The result, packaging experts say, is that this will be one of the last holiday seasons to require a box cutter. "Over the next two years," Silver continued, "they want to transform what the packaging is because they want to make it easier to open."
In March, Consumer Reports magazine gave an "Oyster Award" for the worst plastic clamshell packaging to a warehouse-store version of a Uniden cordless phone set: It took 9 minutes 22 seconds to unwrap completely and nearly caused injury to the person opening it.
Resources
Packaging Design, Trends, And Technologies
by Dennis Calamusa
Packaging Network, Nov. 14, 2006
China's Packaging Revolution
by Benjamin Punchard
Packaging Gateway, Sept. 1, 2006
The 2006 FPA State of the Industry Report
Flexible Packaging Association, July 2006
PMMI Predicts Increase in Packaging Machinery Expenditures in Six of Eight Industrial Sectors
The Frain Group (via PR Web), Sept. 22, 2006
Packaging machinery on the rise again
Machine Design, July 27, 2006
Sustainable packaging goes mainstream
by Anne Johnson
Packaging Digest, October 2006
Convenience, portability, health, drive packaging needs
by Ahmed ElAmin
Food Production Daily, Nov. 24, 2006
Do Not Pry Open Until Christmas
by Margaret Webb Pressler
The Washington Post, Nov. 30, 2006
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Comment
4 CommentsI agree with the article "Do Not Pry Open Until Christmas" By Margaret Pressler. I have passed on buying some things because of the volumes of packaging. I also think that many manufacturs should hire the people that design packaging. If things were built as tough the package they come in, they would last longer and thus we would use less packaging.
December 12, 2006 1:47 PMSpare me, please. I'm sick of hearing about "wrap rage." It's worse than ever this year and it's not even Christmas yet. Despite all the publicity surrounding all the good things packaging does, keep the product safe and secure, the media is on the attack. It seems that this is a subject the public can really get in to (no pun intended). If you are into blogging, check out the words "Wrap Rage" and you will get an earful.
I faithfully respond to the blogs with one or two of my articles explaining the role of packaging in modern society to no avail. People just love to rant about the problems of packaging foisted upon them by the product manufacturers. As if we deliberately made these things difficult to open. Are we advocating increasing the amount of pilferage so we can pay more at retail? I guess we intuitively know what's inside because we don't have to actually see what we are buying. But seriously, don't forget we the "packaging people" are consumers too. Products are packaged a certain way for a reason and its not to make it more difficult.
I recently received sales pitches from companies producing nifty devices to open the plastic consumer nemesis (clamshell) purportedly without mishap. If you recall, I earlier mentioned that a smart marketer would include one of these devices free with every order. (It would have to be on the outside of the package, of course.) If you need some resources for this, please let me know.
I have counted no less than five articles within the week decrying bad packaging but mostly focusing on the poor plastic clamshell. So, I spent a little time thinking about where we would be without it. What is a clamshell?
By definition and its function, a clamshell refers to a formed plastic package used to encapsulate and boldly display a retail product. The formed plastic package has one or more hinges. A single hinged clamshell usually includes a hanger tab that allows the finished product to hang on in-store pegs. A multi hinged clamshell offers additional features that can include a flat base for free standing of the package and the enclosed product.
Let's think of all the products that come in clamshell and all of those companies that manufacture plastic clamshells. Just GOOGLE that and you will be surprised. Bought any cosmetics, electronics, food, hardware, produce, office supplies, toys, toiletries lately?
There is support for the demise of the clamshell on other fronts too. Granted this came out of Europe but a major new study reveals that, given the choice, almost nine out of every ten shoppers would choose products packed in paper rather than plastic or other materials.
The results were highlighted in a recent survey carried out by IPSOS, the world's second largest market research agency. IPSOS based their conclusions on interviews with 6,500 consumers in seven major European countries. 93 per cent of the respondents said that they prefer paper because they consider it is more "environmentally friendly," while 87 per cent of the group would choose paper because of "convenience" factors.
So are we seeing a revolt against the plastic clamshell? Will the plastic clamshell be subjected to a slow lingering death by detractors and naysayers? Or will consumers finally GET OVER IT and go about their business? Time will tell. In any case be sure and send me good examples of plastic clamshell packaging that works.
Don't forget you too can be famous or infamous depending which side of the fence you sit. Be sure and submit your Oyster Award Candidates. Go to their website and nominate your package for the Oyster Awards.
http://research.consumerreports.org/OysterAwards/poll.cfm
