While e-commerce sales had already seen a dramatic upswing between 2018 and 2019, the recent shutdown orders for non-essential brick and mortar retailers due to COVID-19 have created a greater surge. Social distancing is pushing more consumers to shop online, including many who had never done so before. According to Adobe Analytics, between March and April 2020, daily online grocery sales spiked 110%, electronics sales climbed 58% and even online pajama sales were up 143%.
The pandemic has accelerated consumers’ adoption of digital commerce. According to Nielsen, just 4% of grocery sales in the U.S. were done online in 2019. However, 51% of shoppers reported placing an online grocery order in the four weeks ending April 7. Among those, 33% made their first-ever online grocery order during that period. Indications are that this is not a temporary phenomenon. It is anticipated that for many consumers, these new habits could become permanent. In addition, consumers who were forced to try a new brand because their preferred brand was out of stock may switch long-term. And those who learned how to cook because dining out was not an option may continue to do so. Their new-found love for convenient home cooking has driven businesses within the meal kit segment to expand operations. This growing demand is expected to double revenues in this segment year over year.
Even though consumer buying habits have been significantly impacted by the events of the past few months, the opportunity still exists to differentiate your brand by utilizing functional yet stylized variations of your packaging to create a unique experience with each reorder to help keep consumers intrigued.
Brands and retailers that already had a strong e-commerce strategy in place were best positioned to survive the recent shutdown. They have a highly efficient supply chain that excels at managing inventory, providing superior logistics and delivering outstanding customer service. They also differentiate their product and protect it with the right packaging. While the average shopper may not see it, behind the scenes, graphics designers, packaging engineers, marketing managers and logistics experts use their expertise to develop innovative packaging solutions that get the products once purchased at retail directly to your doorstep.
The most important goal of packaging is to protect items so they arrive without damage. Damaged goods hurt the producers’ bottom line and the shippers’ credibility. The right packaging also supports your brand message and contributes to the customers’ experience with the brand. With the recent growth in online sales, brands have the unique opportunity to interact directly with their consumers and make their product stand out through their packaging. PCA can help you develop an e-commerce packaging strategy that is focused on positioning you for success on your journey to a “new normal.”
More and more brands are choosing to sell and ship directly to consumers (DTC) via their own e-commerce sites or through a third party like Amazon. Doing so most often requires a change to their packaging strategy. When products are shipped to retailers to place on shelves, they most often ship upright on stacked pallets. These pallets may make their way around the world but will only be handled a few times in very predictable ways (by forklifts and other machinery).
However, when packages are shipped DTC, we need to account for more variables. Those boxes are handled individually and will most likely be jostled, dropped, tossed and stacked in various orientations on their journey to your customer. In addition, “shopper-owned carts,” which include different items that are expected to arrive together, pose another challenge. For example, a box of pancake mix packaged with a jug of detergent is the sort of variability that increases the chance for damage. At PCA, we will work with you to develop solutions that mitigate the effects of transit and the “random basket of goods.”
Looking to the future, we expect the rise of DTC shipping and shopper-owned carts to continue. We also see an increased need for innovative “Ships in Own Container” (SIOC) solutions, which reduce over-packaging and labor “touches.” We are actively developing effective SIOC solutions that incorporate value-added features that allow for storing and dosing/serving of your product.
You also need to consider how you can promote your brand through your packaging. Unfortunately, the growth in home deliveries has provided more opportunities for “porch pirates” to pilfer your product at your customers’ doorstep. So your package needs to strike the perfect balance between being discreet about what it contains and providing your consumer with a unique unboxing experience. A partnership with PCA will offer you options to brand the inside of your box and give you access to our patented designs to help you meet your specific e-commerce objectives.
If you would like to talk with one of our packaging experts to discuss solutions for your e-commerce packaging needs, please provide us with your contact information.