Are retailers ready? | Article

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In light of pandemic-related trends toward e-commerce shopping, how can retailers re-engage consumers in the bricks-and-mortar experience? The answer, according to AIPIA’s communications director Andrew Manly, lies in the successful and comprehensive usage of smart packaging.

We hear a good deal about the changed retail landscape in a post-pandemic world. While there are clear signs of a return to ‘bricks and mortar’ shopping, the gains made by e-commerce and home delivery services show no signs of falling away. So, the retailers, who are heavily invested in physical stores, need a clear strategy to increase footfall and some clear data to find out what can attract consumers back to the aisles.

One thing Smart Packaging can deliver is very accurate information about consumer behavior and what motivates them to make a purchase. But do retailers take advantage of this by encouraging their customers to interact with products on their shelves? My experience so far is that they are woefully slow to take these opportunities.

For example, in my local (Dutch) supermarket he identified at least 15 products with some kind of scanning device (RFID/NFC or QR codes) which would enable them to communicate authenticity, provenance, allergy or marketing/consumer engagement information. Was there any ‘call to action’ on the shelves?

Zero… In particular, one bottle of wine with a very fine AR experience accessed by a code tag on the neck label sat forlornly on the shelf alongside every other bottle, shouting “scan me!”

So, the recent news that Walmart and Nordstrom in the USA are issuing RFID mandates to all their suppliers is almost a moment of epiphany. And to be fair to Walmart, this is not their first investment in the technology.

Back then, nearly two decades ago, the tags were not up to snuff really and it showed some courage by the retail giant in an RFID sector which was rapidly, but erratically, emerging and had many teething problems (read ranges, failures in wet or cool conditions, etc.) It did not work then, but it stands every chance of working now.

Both tags and QR codes (which also had a less than triumphal start in the packaging world) are now able to do things on a reliable level, contain excellent security and access features and, in the case of tags can be produced at scale and aimed at specific applications. Avery Dennison Smartrac recently introduced a small factor inlay specifically for the Retail sector.

But, and this is a big but, if we have now got the attention of at least some big retailers – and surely others will now follow – how are they going to use this newfound wealth of information they are able to gather from the interactions in their stores? The recent report produced jointly by AIPIA and Accenture showed the enormous potential for Smart Packaging to benefit everyone along the value chain.

But it also showed that company practices need to change if the data which is now available is to be used purposefully and shared across multiple departments (from production and storage/logistics through to promotion and marketing as well as in-store management and staff.) The report calls it ‘dissolving data silos’.

Of course, the report is not specifically aimed just at retailers but it can most certainly be applied to them, as much as to CPG manufacturers and logistics providers.

From its many contacts with brand owners and others in the supply chain over the last decade, AIPIA is certain that they are aware of what benefits Smart Packaging, in all its many manifestations, can offer. Yes, they wanted to see proof of concept, affordability, scalability, some standardized procedures (such as GS1) and a clear case for ROI. By and large, the Smart Packaging sector has delivered on all of these.

So now it’s time for retailers other than Walmart and Nordstrom – as well as the majority of apparel retailers – to fully engage with Smart Packaging. Then we can really attack food waste, reduce counterfeiting, increase food security, improve recycling, and truly get the customers involved with the products they buy. That way, we all benefit.

This article was created in collaboration with AIPIA (the Active and Intelligent Packaging Industry Association). Packaging Europe and AIPIA are joining forces to bring news and commentary about the active and intelligent packaging landscape to a larger audience. To learn more about this partnership, click here.

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