What might the packaging industry look like in 2025?
At the moment, some of our most basic assumptions about the world are being questioned. Globalisation is coming under fire. In politics and economics, rulebooks are being torn up. Today it seems harder than ever to look into the future. That’s why at DS Smith we recently brought together a group of exceptional thinkers to look at current trends that are having a big impact on our world. We then thought about how those drivers might develop and interact, shaping our ideas into three different versions of the world in 2025. These three scenarios aren’t predictions, but they are plausible.
Scenario 1: Caring convenience
Today, e-commerce makes up about 10 percent of purchases in Europe and America, growing fast and seemingly unstoppable. However, during 2017 Uber kick-starts a major change. It begins accepting deliveries as well as passengers, and the price of last-mile fulfilment drops as radically as taxi fares have, allowing the traditional retailers to fight back. Instead of sharing rides with strangers, our co-passengers become groceries, Lego sets and clothing. We even get money off our taxi fare if we’ll take packages to neighbours’ front doors. This allows smaller players to compete with Amazon on price and beat them on delivery.
By 2019, half our shopping is delivered to the doorstep. Transit packaging has been completely re-specified to protect products from damage, have no wasted space, be delightful to open and easy to re-use and recycle. However, not everybody is happy.
The cardboard backlash
In 2020, the average household receives more packaging every two weeks than a single dustbin can hold. Local authorities do their best, but can’t cope with the surge in materials for recycling from the doorstep. Logistics and waste management costs start to rise, and e-retailers pass those costs on to consumers. Suddenly e-commerce doesn’t seem like the miraculous bargain it once was, and inspired by consumer and environmental pressure groups, the so-called “Zero Packaging Movement” takes to the streets to protest. With so much concern from consumers, packaging companies realise that it’s time for radical solutions, not small improvements.
So a whole new age of creativity begins as brands and their packaging designers start to create ideas that work in the new e-commerce supply chain at the same time as seducing consumers in-store – truly packaging for the new retail omnichannel.
Scenario 2: Everything is an experience
In 2017 the barriers to entry in many FMCG categories begin to diminish. OEM factories are able to produce small runs of products, distribution is handled online, and viral marketing doesn’t need big media spend. Microbrands are already threatening global players in craft beer, cheese and chocolate. Packaging is critical for these small brands. In many instances, it’s the only publicity they get.
By 2018, consumers are becoming much more interested in provenance, and sources of ingredients have to be verifiable. Throughout the supply chain, as well as being beautiful, packaging becomes smart and traceable; anybody who wishes to check where the beans in their chocolate bar came from can just scan the wrapper.
Sharing economy brings transformation
By 2019, the sharing economy has really taken hold, with consumers less interested in owning durable goods. In 2020, Bosch rents more power tools than it sells, and for a small price, it will arrange a DIY expert to help you do a great job. The packaging becomes critical, ensuring everything arrives and is returned in perfect condition, day after day. Levi’s stores stop selling clothing. Instead, they become places where customers are measured for bespoke items, which are then tailored and delivered to people’s homes. P&G makes its Gillette razors available only by subscription, at the same time announcing that it aims to become a lifestyle services company, investing in male grooming academies across the US to teach men how to look their best.
Packaging becomes part of the show
By 2021, instore marketing spend overtakes traditional advertising. Supermarkets and shopping malls became theatres for brands, with crèches, live entertainment and cafes. The smartest packaging companies start to understand that they have to create a delightful experience that engages with the shopper long after they have left the store, via shapes, graphics, and connectivity to the Internet of Things. Every unboxing becomes a shareable moment – we’re all in showbusiness now.
Scenario 3: Asian new deal
China’s growing middle class is becoming increasingly concerned about smog and pollution. In 2018, pollution rises to deadly levels in three mega cities. The Chinese government reacts swiftly and promises to clean up the air.
The great carbon tax begins
So by 2019, all emissions are measured and then taxed. In 2020, the Chinese announce that although they will continue to recycle their own used packaging, they won’t go on buying recovered fibre from Europe and America. Instead, they’ll grow their own. Millions of trees spring up across Asia – genetically modified for fast growth and carbon absorption. Farmers who once grew coffee, cocoa or palm oil become foresters instead. The price of recyclable fibre crashes, and in the West, companies and governments respond to the new Asian model by creating real circular economies built on dramatic improvements in the way that materials are recovered and reused.
At the same time, Delhi’s citizens are choked with exhaust fumes from the cars and trucks that jam its streets. India decides on radical measures. All deliveries are to be performed at night, using electric driverless goods vehicles. Waste is also managed by fleets of unmanned vehicles that are able to monitor the sustainability of individual citizens. Those consumers leading recklessly planet-damaging lives are penalised.
Packaging is information technology
By 2025, astonishingly powerful computers monitor emissions around the world, making us more efficient, tracking transactions, and stabilising the planet’s eco-system. Although this level of surveillance causes concern amongst civil liberties groups, most citizens seem happy to trade some privacy in return for cleaner air for their children.
Brave new world
We hope these scenarios disrupt and inspire your thinking. No one knows what the next decade will actually have in store for consumers, brands, manufacturers and packaging, but it’s a good idea to dream, evolve and anticipate what could be. Join the conversation - #rehearsingthefuture
By Alex Manisty, Head of Strategy at DS Smith
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