Overcoming E-Commerce Challenges with Strategic Packaging Decisions
The future is bright for brands pursuing primary packaging designed to sell and ship in the e-commerce channel.
The method of transporting products to traditional retail stores has been optimized down to a science over the years. Identical products pack neatly into corrugated boxes, which ship together on a skid to the retailer. Seldom do products arrive damaged, as they have been optimized to be shipped and sold in palletized units.
However, the game changes with the e-commerce supply chain. To reach the consumer’s doorstep, food and beverage products may go through three to five times as many touch points as the traditional retail supply chain.
When consumers receive a damaged product, not only can it reflect poorly on the brand, but many times, the brand is charged for reshipping, repackaging, and damages to any other products in the shipment.
To diminish the risks of damaged products during transport, brands and online retailers may implement tertiary packaging such as air pillows, bubble wrap, shrink-wrap, etc. While this does help protect the product, it can significantly affect profitability due to the total cost increase, while also creating an undesirable unboxing experience for consumers. In addition, the excess plastic is not environmentally friendly and makes the shipping process less efficient with less items fitting in each box.
As brands increasingly become aware of these challenges, they have the opportunity to further improve the performance of primary packaging, and in turn, improve the brand’s bottom line.
Packaging Considerations for the Online World
Statista notes that U.S. food and beverage e-commerce revenues are projected to grow to $25.9 million by 2022, which is more than double 2016’s revenue of $11.6 million. To keep up with the radical growth of e-commerce, it is important that food and beverage brands start to consider adopting primary packaging that is designed to withstand this rigorous supply chain.
Fortunately, brands do not need multiple packaging formats for the different retail channels as primary packaging can be simultaneously engineered for e-commerce distribution and brick & mortar stores.
In the short term, brands will benefit from collaborating with suppliers who are knowledgeable about e-commerce testing protocols. One example is ISTA 6-Amazon.com-Over Boxing, which mimics how a package responds to shipping conditions by simulating drop impact, vibrations, and temperature fluctuations.
Furthermore, brands can count on packaging suppliers who participate in the Amazon Packaging Support and Supplier Network (APASS). These suppliers provide exclusive services related to packaging design and tests that comply with Amazon’s guidelines in order to help vendors, sellers, and manufacturers receive certifications such as Frustration Free Packaging (FFP), Ships-in-Own-Container (SIOC) or Prep-Free Packaging (PFP).
As the majority of food and beverage packages are not at a point where they can receive FFP or SIOC certifications, designing a new package that is PFP (prep-free) is not only possible, but also worth pursuing. Benefits of the certification include decreasing total cost per shipment, as PFP-certified products do not need excessive protection and additional labor, as well as highly increasing consumer satisfaction. In addition, PFP-certified packages also minimize the use of plastic, while allowing for a more efficient shipping process, with no returns due to poor performance.
The future is bright for brands pursuing primary packaging designed to sell and ship in the e-commerce channel. Embracing the needs of e-commerce and collaborating with strategic suppliers who can help brands to rethink packaging will not only give consumers the e-commerce experience they expect and deserve, but also help brands improve their bottom line with a competitive advantage for years to come.