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INSIGHTS
LEADLINE
Issue 5 | July 2021
World's First Concept-Oriented Print and Packaging Magazine
Packaging is a life line to your product
AN EFFECTIVE HANG TAG
Know how it grab your customer attention
TRENDING
Sustainability in Packaging,
Worldwide coverage
CPP
www.creativeprintpack.com
World's First Concept-Oriented Print and Packaging Magazine
EDITOR IN CHIEF
CONTENTS
Raghu Kacharagadla
raghu@creativeprintandpack.com
CPP INSIGHTS
WRITER
CPP Insights Team
insights@creativeprintandpack.com
GRAPHIC DESIGNER
CPP ID Team
design@creativeprintandpack.com
DIGITAL TEAM
Think Beyond Creativity
tbc@creativeprintandpack.com
FOUNDER AND
MANAGING DIRECTOR
KONDAIAH CHOWDARY P
Copyright© 2021 CPP INSIGHTS
AN EFFECTIVE HANG TAG : P27-P36
Know how it grab your customer attention
SUSTAINABILITY : P2 -P25
Sustainability in Packaging, Worldwide coverage
LEADLINE : P37-P41
Packaging is a life line to your product
CPP INSIGHTS
A UNIQUE PLATFORM OF PACKAGING
CPP INSIGHTS BUILD BRANDS
We are a house of creators, thinkers, artists, and scientists. As an extension of
your team, we’ll work with you to build an innovative brand that gets meaningful
results.
We know great design, and we believe that inspiration and creativity come from
anywhere.
We never stop challenging ourselves to think differently and produce compelling
ideas. From packaging to brand identities, we thrive when we are able to flourish
alongside our clients.
THE BUSINESS OF BEING
CPP INSIGHTS
Since 2007, we’ve been known for our
top-notch packaging and branding
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We don’t believe in cookie-cutter
packaging and branding solutions and
our service is truly customized to meet
the unique needs of each client. We
thrive when we are able to grow
alongside our clients and watch them
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INTR’O’
THE DESIGN & PACKAGING
From full brand identities and package design to Branding, we’re known for
delivering quality creative services. Here’s a glimpse at what we can design and
manufacture for you...
 Mono Cartons
 Corrugated Boxes
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 PDQ Boxes
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Start Love with us:
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SUSTAINABILITY IN
PACKAGING:
INVESTABLE THEMES
Mapping five industry-shaping trends uncovers specific investable themes for
participating in sustainable packaging.
IVE KEY TRENDS are emerging that will shape sustainable packaging and
related investable themes over the next few years. First, consumers are
highly aware of sustainability issues, with their concerns accelerating, but
they remain confused. Second, in response to public outcry, sustainability
regulation for packaging is now both global and increasingly ambitious, but it has
become a complex landscape for corporations to navigate (with accelerating
consumer sentiment also making it harder for companies to plan reliably). Third,
across regions there are critical gaps around waste collection, recycling systems,
and technology, limiting significant changes in the packaging value chain over the
near term. Fourth, leading fast-moving consumer goods (FMCG) companies and
retailers remain committed to transforming their portfolios, but large-scale
market adoption of innovations is slow. Lastly, until further notice, plastics are
here to stay, with an emerging green premium on the recycled raw material.
Additionally, sustainability in packaging needs to be managed to reflect regional
differences and in conjunction with megatrends. In response to this emerging
outlook, specific investable themes across the full packaging value chain can be
seen. In order to avoid missing out on any of these themes, we suggest starting
with a few questions regarding materials and processes.
IVE KEY INDUSTRY-SHAPING TRENDS IN SUSTAINABILITY
What is in store for the packaging industry over the next three to five years
in terms of sustainability? What are some emerging theses for institutions
looking to invest in the space (or for current players in the packaging value
chain looking to diversify beyond their current portfolios)? To find answers, we
conducted extensive interviews and discussions with FMCG companies, retailers,
and packaging industry executives and experts in major end-user markets across
regions. We also applied the findings from our ten-country survey to capture
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consumer attitudes around sustainability in packaging. Our analysis has identified
five major industry-shaping sustainability trends (exhibit).
CONSUMERS ARE HIGHLY CONCERNED, YET THEY ARE CONFUSED
Global consumers are
increasingly worried about the
environment and the impact of
packaging leakage. While buyers
claim to have high willingness to pay
for more sustainable packaging,
purchasing choices are still largely
driven by other factors (such as
brand, quality of products, and
economics). For example, US
consumers rank overall
sustainability relatively low as a
buying criterion among end-use
factors; they regard price, quality,
brand, and convenience as more
important. We see a similar pattern
for global consumers. Moreover,
consumer attitudes are not always
scientifically consistent: for example,
our global survey finds that
consumers rank plastic packaging
that is either made from compostable
materials or is recyclable as quite
sustainable, yet they simultaneously
rank plastic containers and bottles
made from such recycled materials as
among the least sustainable. Going
forward, given the current situation,
we expect consumers to remain
concerned while various stakeholders
such as FMCG manufacturers,
retailers, and packaging companies
ramp up their educational campaigns.
In the coming years, we would also
expect that brand owners will
address the carbon intensity footprint
of the product as well as its packaging
in a more transparent way by
implementing “carbon intensity
labels.” First movers of such labels
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are already present in areas such as consumer electronics.
INCREASING AND ACCELERATING COMPLEXITY OF THE REGULATORY
ENVIRONMENT HINDERS PLANNING
New regulation is expanding on
multiple fronts and is becoming ever
stricter. At the same time, regulatory
focuses and approaches vary
considerably by region and diverge
even further when looking at country,
county, and city-level regulations.
Understanding this variation will
require a granular approach.
Meanwhile, the number of new
sustainability regulations is
accelerating and becoming more
ambitious. Beyond plastic bans,
plastic taxes have started to be
introduced in Europe, with recovery
schemes to be developed on a
national level.1
Taken together, these
trends limit companies’ ability to plan
reliably and make navigating the
landscape even more complex,
especially for multinationals.
CRITICAL GAPS IN THE VALUE CHAIN EXIST, LIMITING NEAR-TERM MAJOR
CHANGE
With demand for packaging
showing strong, global growth,
leakage or unmanaged dumps of
packaging have increased. In
particular, plastics have low overall
recycling rates: globally, only about
16 percent of all plastic waste is
reprocessed to make new plastics,
and the majority is either incinerated
or sent to landfill. In the United
States, for example, key drivers of the
low recycling rate of plastics are
several critical gaps in the value chain
around recycling system capabilities
and economics. For example, current
sorting technology cannot effectively
handle approximately 30 percent of
plastic packaging. In
addition, coordination across the
value chain is complex to scale, with
recycling operations fragmented
across geographies.
FMCG companies and retailers remain committed, but market adoption
of innovation is slow
With consumers increasingly
aware of and more vocal about their
sustainability concerns, and with
growing regulatory pressure, leading
FMCG companies and retailers have
made strong commitments to
sustainability. However, transforming
the packaging portfolio has proved to
be challenging, with the need to
manage complex trade-offs
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encompassing multiple implications
for sustainability—for example,
achieving high recyclability versus a
low carbon footprint.
Meanwhile, options can be
restricted because of often slim
margins and important branding
implications. In addition, what is
technically and economically feasible
to realize will vary by geographic
region. Nevertheless, despite these
challenges, FMCG manufacturers and
retailers continue to deliver
innovations in a bid to achieve their
own sustainability commitments for
packaging in two specific areas:
 Recyclable or alternative materials. Recent years have seen a steady
introduction of new materials, technologies, and coatings to help address
the sustainability challenge.
 Markets for reusable or returnable. Circular systems of packaging are not
new; several countries still have a national system for managing returnable
packages such as beverage bottles. However, extensions of this concept are
now emerging whereby consumers also return packaging and refill on the
go (examples include food service and in-store dispensing systems), and
there also are new options for return and refill at home (for example, e-
commerce packaging or refill pouches).
While these innovations are moving
us in the right direction, broad
market implementation has yet to
break through. Instead,
implementation has mainly been
seen among a limited range of SKUs
and within country-specific pilots.
One challenge is that the majority of
innovations to date are typically far
less cost effective, efficient, or
convenient than incumbent
packaging.
UNTIL FURTHER NOTICE, PLASTICS ARE HERE TO STAY, WITH AN
EMERGING GREEN PREMIUM ON THE RECYCLED RAW MATERIAL
With current infrastructure
gaps and technical challenges in
transforming packaging portfolios,
leading brand owners seem not to be
making big shifts away from plastic
packaging—for now. Instead, they
are working on improving the use of
plastics by consolidating the types of
plastic used (with a focus on
improving recyclability), decreasing
new plastic resin usage, and
accelerating the use of other recycled
materials. Globally, there is increased
demand for recycled plastic materials
in not only packaging but also textiles
and other applications. With low
global recycling rates of plastics, gaps
in infrastructure, and continued
expansion in demand, there is a
growing green premium for access to
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high-quality volumes of recycled
plastics. This is likely to remain as
long as there is a supply–demand
gap, but it will differ according to
region.
MPACT OF OTHER MEGATRENDS AND REGIONAL DIFFERENCES
Not surprisingly, sustainability is not the only trend affecting the packaging
industry. Trends such as the shift to e-commerce, rapidly changing consumer
preferences with high price sensitivity, consumers focused on health and
wellness, and digitalization are here to stay. In particular, we have seen food
safety and hygiene grow as a key concerns for consumers in the COVID-19
pandemic alongside an increased share of packages sold via e-commerce
channels. Additionally, reasonable cost and convenience continue to be “must-
haves” for packaging. At the same time, the strength and pace of these trends can
differ significantly by region: our research has revealed common global themes,
but also sizable differences in perception. Similarly, the regulation strength differs
by country and region, just as much as recycling infrastructure does.
NVESTABLE THEMES AND HOW TO START TO ADDRESS THEM
Against this backdrop of increased pressure from regulations and consumers,
we see several specific investable themes relevant to the sustainable-
packaging agenda.
IMPROVE PACKAGING RECYCLABILITY.
This concerns packaging and raw
materials that are more conducive to
recycling or enabling technologies
that improve recyclability. For
example, we have seen numerous
R&D efforts to develop recyclable,
high-barrier mono-materials (such as
all-polyethylene materials or
components). It could also include
nonpolymer substrates; several paper
and board producers have developed
fiber-based materials such as molded
pulp or functional papers to replace
polymers. Finally, improved
packaging recyclability also
encompasses technology that
enables improved sorting and
subsequent recycling of the
packaging (such as digital bar codes).
INCREASE USAGE OF RECYCLED CONTENT IN PACKAGING.
An investable theme could include
either supporting infrastructure
system development or
expanding current recycling
capacity beyond polyester (PET)
to cover emerging recycled
polymers such as polypropylene (PP)
and polyethylene (PE). Similar to
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the theme of recyclability, enacting
digital technology changes could also
enable increased usage of recycled
materials (for instance, to improve
sorting).
Scale up usage of compostable packaging.
This theme includes implementing
raw materials or packaging that can
be composted, often based on using
renewable resources such as fiber- or
starch-based raw materials. It could
be interesting to look at
opportunities that would enable at-
home or community composting
schemes given the few industrial
composting facilities that exist
globally. One challenge is the limited
barrier properties of some
compostable packaging that inhibit
large application areas. Another area
to consider could be innovating new
coatings or adhesives that would
enable the composting of the
material and support scaling this
application to other end-use areas.
INTRODUCE REUSABLE AND RETURNABLE PACKAGING.
An investable theme could center
around systems for using returnable
or refillable containers and
packaging. However, scalability is yet
to be proved for many of these
models, and refill-and-reuse
approaches are still in their infancy
(even though they are a proven
concept historically). The rise of e-
commerce specifically can lead to an
increase in reusable and returnable
packaging, pivoting from the mostly
one-way flow of packaging currently
in use.
DEVELOP NEXT-GENERATION LIGHTWEIGHTING.
One of the evergreen packaging
trends, light weighting is expected to
accelerate further based on two
factors: first, it will allow for less
material usage and, second, it may
lead to lower transport-related
emissions. Investments could be
centred on technology to enable this
approach or on innovations in
materials to replace current
packaging with lighter materials.
Moreover, while previous light
weighting trends have spurred the
rise of multilayer materials, we would
expect increased focus on high-
barrier mono-materials to allow for
both lightweighting and high
recyclability.
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LOWER OVERALL CO2 FOOTPRINT AND MAKE THE CARBON INTENSITY OF
MATERIALS, PACKAGING, AND PRODUCTS MORE TRANSPARENT.
Previous research has shown
that packaging material can account
for more CO2 than the actual product
contained. In light of this and their
sustainability commitments, FMCG
manufacturers and retailers are
exploring switching toward lower-
emission substrates—and players
operating in substrates with typically
higher emissions are exploring more
carbon-neutral packaging via shifts to
green-energy usage or even carbon-
offset or storage options. Thus,
technologies or packaging products
that offer a relatively lower carbon
footprint now or in the future
compared with incumbent packaging
stand to benefit from the global trend
to reduce greenhouse gas emissions
and can become differentiators. This
can be fueled by ambitions from
some FMCG players to increase
emissions transparency by printing
the carbon footprint on the
packaging. Such carbon-intensity
labels that create transparency for
customers could have a large impact
on the packaging value chain and
result in a need for packaging
redesign and further shift substrate
usage to lower-carbon-footprint
materials (which may not necessarily
be recyclable).
Opportunities arising from these themes can be applied across the packaging
value chain—but investors will need to be aware of regional and product
differences because these might drastically change the outlook for potential
investments. Given different regulatory regimes and consumer behaviors,
regional differences might indeed change the business outlook, with packaging
solutions facing significant variation in terms of consumers’ willingness to pay for
sustainable solutions. This complexity cannot be overestimated and requires in-
depth analysis. To get started with addressing investable theme opportunities, we
suggest a few material questions:
HAT GRANULAR SUSTAINABLE-PACKAGING OPPORTUNITIES ARE
AVAILABLE? We suggest conducting a rapid but broad scan of
companies offering the most promising sustainable solutions for the
regions and applications in focus (without forgetting to address regulatory
developments).
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HAT ARE THE BIG BETS ON FUTURE MATERIALS AND PACKAGING?
Based on the sustainability scan, categorize what are the most feasible
and actionable opportunities to capture a premium from sustainability
innovation over the short term versus the long term. It will be important to
understand the actionability: that is, how rapidly companies’ innovations can be
scaled, as well as their potential cost competitiveness and barrier performance
versus incumbent materials.
HAT ARE THE OPPORTUNITIES BEYOND INNOVATIONS IN PACKAGING
AND MATERIALS?
This would include opportunities to facilitate the circular business case
around infrastructure and other technology to advance the recovery, reuse, or
recycling of previously used materials (for instance, chemical recycling). It could
also include scanning and understanding solutions to minimize leakage into the
environment (such as digitally enabled technologies in sorting and recycling).
Sustainable packaging is a rapidly evolving area. Multiple attractive investment
themes are available to achieve large-scale improvements toward more
environmentally friendly packaging with an attractive growth profile. However, it
will require a granular approach and deep understanding of actionable solutions
to identify attractive themes that are truly scalable.
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SUSTAINABILITY IN
PACKAGING:
CONSUMER VIEWS IN
EMERGING ASIA
Rising sustainability concerns within developing Asia, a key growth vector, make
understanding the consumer perspective critical to capturing the growth
opportunity for packaging companies.
ith China having displaced the United States as the largest global
packaging market, Asia remains packaging’s top growth market. As the
use of packaging in Asia continues to soar, so too does the ecological
burden, with significant leakage of packaging materials into the environment—
often as a consequence of lack of waste collection and recycling systems at a scale
needed to match strong growth in demand. How are these impacting consumers’
views on sustainability in packaging? To understand this better, we launched a
survey across ten countries, including three fast-growing emerging Asian
economies (China, India, and Indonesia), to explore consumers’ attitudes. Our
findings built on prior work focusing on consumer sentiment globally and an
earlier deep dive into consumer sentiment in the United States.
Survey respondents revealed both overarching and more country-specific
findings. Three key highlights can be observed. First, consumers in China, India,
and Indonesia all feel more strongly than most others about sustainability
problems. They also claim to have the highest willingness to pay for green.
Second, in all three countries, consumers’ top concerns are centered around
water and air pollution and less so around waste production, which is viewed with
more concern in other surveyed countries. Echoing our global findings, consumers
also perceive sustainable packaging to be a top priority for food-related products;
however, the specific food sub segments viewed as most important differ by
country. All three generations of consumers surveyed across the three countries
are highly concerned about the environmental impact of packaging. Overall,
Generation X demonstrates the highest level of environmental concern across
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different sustainability issues, followed by Gen Zers, millennials, and baby
boomers, respectively; however, there is some granular variation. Third, while
surveyed consumers align on their perception of the most unsustainable
packaging material, country-specific views differ on the most sustainable—similar
to global findings. Looking ahead, what consumers wish to see more of is
recyclable or compostable plastics films, as well as more fiber-based packaging.
Emerging Asia remains the key growth market for many packaging companies to
target. With a strong increase in concern around sustainability, it will become
critical to think through the “green narratives” of any growth strategy along with
related strategic options. In order to seize the opportunity, we recommend
considering three factors in your strategic planning.
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EMERGING ASIA REMAINS THE KEY GROWTH MARKET FOR MANY PACKAGING
COMPANIES TO TARGET.
SUSTAINABILITY CONCERNS RISE STRONGLY IN EMERGING ASIA
Over the past decade, the global
packaging industry has enjoyed
steady growth, with the economic
boom in emerging Asia being a key
growth driver. Headline changes
include strong growth of organized
retail and increased use of packaging
to accommodate consumer demand
for convenience. This strong growth
in packaging has led to an increased
environmental burden due to a
frequent lack of the fully developed
packaging-collection and recycling
systems at a scale needed to manage
increased waste.
This has not gone unnoticed in the region. Pressure to reduce packaging
waste has risen sharply, along with actions by fast-moving consumer goods
(FMCG) manufacturers, retailers, and legislators. Despite these measures,
consumers in our survey continue to be highly concerned, with respondents in
China, India, and Indonesia, together with respondents in Brazil, demonstrating
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the most concern globally—concern that has increased since the COVID-19
pandemic (Exhibit 1).
There is a similar finding when it comes to consumers willingness to pay for green
packaging: significantly higher willingness to pay for sustainable food packaging is
observed in China, India, and Indonesia compared with other surveyed countries
around the world. Similar to those countries, Brazil also shows a high willingness
to pay for green compared with the other surveyed countries. This demonstrates
the relatively high level of consumer awareness in these markets and the critical
need for stakeholders to take action.
Two further questions related to the above findings then follow: what are
consumers in emerging Asia concerned about, and who is driving that increased
concern? On the first question, views across the three countries in focus are quite
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aligned: consumers perceive water and air pollution as key areas of concern. This
differs from other surveyed countries, such as Japan, and in Europe where marine
litter is perceived as a higher concern. Consumers in the United States and the
United Kingdom also point out that waste production is a major concern, while
India and Indonesia ranked this as one of the least important issues. The
categories in which consumers consider sustainable packaging most important
differ somewhat between countries—although all focus on food-related products.
In China, priority centres on fresh fruit and vegetables, fresh meat, and dairy
products. In India, the highest importance is given to fast-food packaging,
followed by dairy products and pet food. Indonesia ranks beverages highest,
followed by dairy products, and fresh fruit and vegetables.
When looking more closely into the second question—who is driving the increase
in concern—we find that actually all consumer groups are concerned. Overall,
Gen Xers show the highest levels of concern, followed by Gen Zers and
millennials, and baby boomers (Exhibit 2). Looking at the two key areas of
concern—air and water pollution—Generation X is particularly concerned in
Indonesia, while there is more variance in China and India.
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McKinsey survey indicates that consumers around the world disagree about what
they see as the most sustainable packaging materials; however, there is more
consensuses on what they regard as the least sustainable materials. Among our
focus countries, consumers in China and Indonesia perceive plastics that are
either compostable or recyclable as being more sustainable (a view similar to that
of Brazilian consumers). This differs from consumers in India, who perceive paper
and glass as more sustainable. Overall, consumers are looking for more recyclable
or compostable plastic films and more paper-based packaging (Exhibit 3).
Recyclable, rigid plastics rank quite low, and so do both glass and metal.
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Many packaging companies target emerging Asia as a vital growth vector, and
they also need to develop strategies for success. Examples include identifying
opportunities to serve the target market (for example, high-end market versus
mass market); determining which customers to target (multinational versus local);
adopting the best strategy (such as unit-cost leadership versus innovation
leadership); and approaching growth strategy (organic growth versus
acquisitions). However, with a strong rise in sustainability concerns in the region,
this will not be enough. Accordingly, packaging companies should consider three
further elements:
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 First, understand how local consumers use products and dispose of the
packaging. Our findings show some common regional themes around
sustainability, particularly linking high awareness and willingness to pay.
There is also an emerging wish among surveyed consumers to see more
recyclable or compostable plastic films and paper-based packaging in the
future.
Inevitably, when looking at a more granular level, there are multiple
differences between the countries and among end-use segments, which
require a deeper understanding of the focus markets. Therefore, there isn’t
a collective regional solution for determining what packaging will work best
and what sustainability levers to pull. In most cases, we suggest using the
emerging cross-country themes as a base view supplemented by granular
field research to further inform strategic planning. This should include
comprehensively mapping out cradle-to-grave packaging journeys from
filling to usage and disposal. Such insights will serve as a starting point for
understanding the strategic options that exist around the fit of the
packaging for a given value chain and the range of improvement levers
available.
 Second, take an incremental approach, and act sooner rather than later.
Even with the indicated high willingness to pay for green, this doesn’t
necessarily translate into real consumer action. On top of that, consumers
may not always know what to expect or exactly what they want. Given the
high urgency to act, we therefore suggest considering available “low-
hanging fruit” actions initially. These should be actions that can be taken
with little to no impact on operating costs or capital-expenditure needs,
functionality, or attractiveness of the packaging. For example, decrease
complexity, remove unnecessary use of packaging, conduct a light redesign
to improve recyclability, and, where possible, consider material
substitutions for more mono-materials. Once these actions have been
successfully implemented, companies can then consider addressing system-
level changes that require in-depth value-chain collaboration.
 Third, ensure clear communication around sustainability narratives for both
product and packaging. It is apparent from our survey that consumers
would be willing to buy more sustainable products if they knew what they
were buying. Ensuring that the packaging can communicate the
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sustainability narratives relevant to local consumer concerns will be
essential. Also, in the context of increased local and global regulation
around sustainability, using packaging to further inform consumers about
how a product can be recycled will be vital.
Viewing sustainability issues as a key factor in strategic planning will enable
packaging companies to determine how sustainability can be used as a
differentiator to attract consumer interest and drive growth.
Environmental concerns are top of mind for consumers in emerging Asia. Viewing
sustainability issues as a key factor in strategic planning will enable packaging
companies to determine how sustainability can be used as a differentiator to
attract consumer interest and drive growth.
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SUSTAINABILITY IN
PACKAGING:
INSIDE THE MINDS OF
GLOBAL CONSUMERS
In the wake of the COVID-19 pandemic, some global themes regarding consumer
sentiment are evident. But perceptions and priorities regarding packaging differ
by country and require a granular response.
ustainability remains a key topic for the packaging value chain, but there are
few (if any) insights into consumer perceptions globally—especially now that
the COVID-19 pandemic is also influencing consumer sentiment and
behaviour. To better understand this influence, we launched a survey across ten
countries to explore consumers’ attitudes toward sustainable packaging, building
on our earlier work focusing on consumer sentiment in the United States.
Consumers who took part in the survey have uncovered three main findings.
First, as a result of the COVID-19 pandemic, consumers now place significantly
more value on food safety and hygiene. This is a key element of the next normal
in packaging, whereby packaging suppliers will have to rethink materials and
design requirements.
Second, consumers see sustainability as being increasingly important as we
emerge from COVID-19: marine litter is top of mind in Europe and Japan, while
pollution is more of a concern in other Asian countries and the Americas. Across
the globe, a vast majority of consumers claim to be willing to pay more for
sustainable packaging.
Third, consumers around the world disagree on what packaging type is most
sustainable; however, they do agree on what are the least sustainable options.
Thus, to respond effectively to these evolving consumer sentiments, a granular
view will be needed. In this article, we suggest three critical questions that
S
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packaging players need to answer to get started on creating an actionable fact
base on which to build their future strategy.
To better understand this influence, we launched a survey across ten countries
to explore consumers’ attitudes toward sustainable packaging, building on our
earlier work focusing on consumer sentiment in the United States.
COVID-19’S IMPACT ON SUSTAINABILITY IN PACKAGING
Ahead of the COVID-19
crisis, sustainability was top of mind
across the whole packaging value
chain. Consumers were becoming
acutely aware of the packaging
sector’s environmental footprint,
and, in turn, rising public awareness
sparked responses from legislators
around the world. With sustainability
increasingly part of their value
proposition, fast-moving-consumer-
goods (FMCG) and retail companies
promised swift action and made bold
commitments to improving the
recycling potential of their packaging.
This combination of downstream pull
from consumers along with FMCG
companies responding to the
regulatory push had a profound
impact on upstream players in the
packaging industry: they were
expected to help meet commitments.
However, during the early stages of
the pandemic, hygiene concerns took
priority over the drive to eradicate
single-use packaging in several
jurisdictions. This evolution in
consumer sentiment is also reflected
in our survey, which indicates that
the pandemic has heightened
concerns around food safety,
especially in the hardest-hit countries
(Exhibit 1).
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THE NEXT NORMAL OF SUSTAINABILITY IN PACKAGING
As we enter the next normal, pressure on sustainability is building once again.
FMCG manufacturers and retailers continue to innovate with new packaging
formats designed to improve recyclability—notably with the use of recycled
content such as post-consumer resin (PCR)—as they approach their own
sustainability commitments and also respond to consumer expectations, critical
nongovernmental organization voices, and regulatory pressure.
New regulation is currently expanding on multiple fronts: no longer is it confined
to just a few countries or regions. Today, sustainability regulation has become
much more of a global phenomenon, even if the level of regulation varies. At the
same time, consumer concerns remain: when we asked consumers about their
perceptions of packaging sustainability compared with pre-COVID-19 times, only 4
to 11 percent of consumers globally said that they are now less concerned.
Consumers are generally more concerned in developing economies such as India
(87 percent of consumers are more concerned), Indonesia (80 percent), and Brazil
(65 percent). Nevertheless, consumers in more developed economies are also
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showing higher awareness around sustainability issues: for example, 48 percent
of US consumers are more concerned. However, what consumers are concerned
about differs depending on region (Exhibit 2).
In all countries surveyed, the overwhelming majority of respondents claim to be
willing to pay more for sustainable packaging across end-use areas. In food
service, for example, highest willingness to pay is in China, where 86 percent of
consumers say they are willing to pay “a lot” or “a bit more” for sustainable
packaging, followed by Indonesia, the United States, and Brazil (75 percent, 68
percent, and 66 percent, respectively). In Germany, Italy, India, and the United
Kingdom, around 56 to 59 percent say they are willing to pay “a lot” or “a bit
more” for sustainable food-service packaging. Willingness to pay more for green
in food service appears lowest in Japan and France, where 48 percent of
consumers are willing to pay more for sustainable packaging. At the same time,
better labelling on the packaging (explaining its sustainable attributes) and
increased availability would encourage 23 to 61 percent of the surveyed
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consumers to buy more green packaging. Taken together, these facts plainly
suggest that a clearly communicated sustainability benefit is a strong value
proposition for packaging suppliers.
SUBSTRATE VIEW: WHAT DOES THE GLOBAL CONSUMER PREFER?
It is often wondered what packaging substrate is seen as the most sustainable by
consumers. Our survey indicates that consumers around the world disagree about
what they view as the most sustainable packaging materials, but their perception
is quite aligned on what they regard as the most unsustainable materials (Exhibit
3).
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Paper-based cartons rank quite high for sustainability in the United States and
among surveyed countries in Europe, as does glass. However, this is not the case
in Brazil, China, and Indonesia where both types of packaging are ranked much
lower. Compostable plastic films have a strong global recognition as being
sustainable.
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Packaging combining plastic, paper, and aluminium foil (for example, flexible
packaging) ranks lowest from a consumer perspective across all surveyed
countries. Additionally, aluminium foils, plastic bottles (even with recycled
content), and metal containers rank on the lower part of the spectrum.
THREE CRITICAL QUESTIONS TO CONSIDER
Packaging suppliers should take a strategic look at their portfolios and assess
them with three key questions in mind:
 What are the substrate shifts you can foresee in your focus markets based
on anticipated consumer perception and regulatory changes?
 What is the resulting value at stake (that is, where are you most exposed
given this and your market position)?
 What are the potential growth opportunities for which you would be
uniquely positioned to provide winning solutions?
Answering these three questions will help to create an actionable fact base. Based
on this, packaging suppliers should update and enhance their product- and
technology-strategy road map with relevant sustainability narratives. Doing so will
help to identify growth opportunities and the partners needed to deliver them
and provide insight into areas of risk in instances where volumes might move to
alternative substrates if no solution can be developed.
Consumer sentiments seem to be shifting continuously, most recently with
heightening focus on food safety and hygiene. Understanding consumers’
sentiments and preferences around sustainability at a granular level will be a key
early indicator for the value chain as to future regulatory pressure and instances
where large packaging-substrate shifts could occur. Proactively identifying these
sentiments and potential shifts could allow packaging suppliers to stay on top of
trends as they develop and to become a thought partner by supporting customers
in revamping their packaging portfolio—ultimately creating significant growth
opportunities.
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DID YOU KNOW
The Chinese takeout box with its Japanese-
influenced origami folds is actually an
American Invention. On November 13, 1894,
in Chicago. Inventor Frederick weeks Wilcox
patented his ‘paper pail’ a single piece of
paper creased into segments and folded in
such a way as to create a leak-proof
container which he secured with a wire
handle.
------------------------------------------------------------------------------
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AN EFFECTIVE HANG TAG
angtags are the labels attached to clothing that usually contain the basic
information about the item. Size, price, brand… all this can be found on
the hangtag. But what is now becoming more prevalent in the industry is
the practice of using hangtags as another weapon in the battlefield of marketing.
Although many people think they are just there to tell the customer how much
the item costs, hang tags are a branding opportunity that is often overlooked in
the retail industry. Not only are they important for the end-user, but they can
support brand identity and increase awareness.
From what a hang tag means to the consumer to the different finishes available to
further your branding, learn about the importance of the underestimated hang
tag.
H
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 What a Hang Tag Means for the End User of Your Product
 A Famous Hang Tag That Demanded Attention and Broke Through the
Noise
 More Important Than Ever: Eco-Friendly Retail Hang Tags
 Different Finishes Can Create a Distinctive Effect for Your Branding
WHAT HANG TAG MEANS FOR THE END-USER OF YOUR PRODUCT
Hang tags are beneficial for the details that are important to a customer such as
sizing, pricing, and brand. But they are so much more than that in today’s bustling
retail industry. Here’s just some of the information you could include:
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Care information - Advises the customer on how to wash their garment and
makes your brand feel more credible.
Material details - This is especially important to environmentally conscious
shoppers who want to shop sustainably.
Unique selling points - Differentiate your garment from the rest and flaunt its
best attributes.
A high-quality branded swing tag ensures the customer that the product is of the
same standard and adds to its credibility. Also, it gives you the space to
demonstrate why they should choose your garment over any other brand.
Whether you’re showcasing the standout features that are a major selling point
for the garment or including important material information, customers will
resonate with this and take notice that the design includes these details that are
often neglected. Connecting with consumers has never been more important.
A FAMOUS HANG TAG THAT DEMANDED ATTENTION AND BROKE THROUGH
THE NOISE
Innovative hang tags can be a selling point for your garment and in some cases,
will be left on to showcase value, quality, and the brand itself.
For example, Off White’s iconic industrial zip tie paired with the black and white
striped hang tag. It contrasts with the luxury and expense of the fashion brand
and everybody thinks twice about cutting that prestigious tag. This bold
statement has created brand loyalty and customers will buy most things with that
famous hang tag.
It shows that hang tag designs don’t have to be overly complicated and that a
well-made one can establish itself as an industry leader. Breaking through the
noise isn’t easy, but creating something with the potential to do so is made easier
with the creativity hang tags give you.
MORE IMPORTANT THAN EVER: ECO-FRIENDLY RETAIL HANG TAGS
The fashion industry is one of the major contributors to pollution in the world.
People are quickly becoming more educated about the brands they purchase
from and their environmental impact. This includes the sustainability of the
fabrics used right down to the material of the hang tag.
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Opting for an eco-friendly alternative such as sustainable papers for hang tags and
vegetable inks is a step towards reducing the harmful impact fashion has on the
environment. Taking a position on sustainability ensures a place within the ever-
changing industry.
DIFFERENT FINISHES CAN CREATE A DISTINCTIVE EFFECT FOR YOUR BRANDING
When your product is competing amongst others in an oversaturated retail
environment - you need to stand out. Hang tags play a vital role in brand
awareness and you’re missing the chance to extend your narrative if you’re not
utilizing them.
You’re no longer restricted to the traditional rectangle hang tag with the usual
plain font price, sizing, and logo. Bespoke clothing branding specialists can give
you the tools to make truly individual garment trims.
Using cutting-edge printing techniques, you can create compelling designs for
your retail hang tags that not only make an impact but are in line with your
branding.
Matte Lamination - Create a soft and subdued look with this technique that
works well with a minimalistic design to really create a sophisticated hang tag.
Foil Stamping - Enhance the look of your hang tag by bonding metallic foil to
create a highly visual and attention-grabbing finish.
Embossing - Using heat you can accomplish a raised effect which works especially
well to make logos stand out against an intricate background.
These are just a selection of innovative printing techniques that you could use on
your hang tags. But as you can see, you really do have the power to create totally
unique tags.
ARE YOU OVERLOOKING THESE INNOVATIVE TAGS, BADGES, AND TICKETS TOO?
So you know the importance of hang tags now. But are you neglecting the other
important garment trims that could elevate your branding further?
We’ve created an all-in-one guide that covers everything you need to know about
adding a fashion-forward finish to your garments.
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DESIGNING A HANG TAG? HERE’S WHAT INFORMATION TO INCLUDE
Why hang tag your custom apparel?
1. They draw attention: In a retail setting, people come into contact with a lot
of brands, often displayed close together with similar products. Anything
you can do to differentiate your apparel will help get your brand noticed.
2. They tell a lot about your product and your brand: Any marketer will tell
you that a customer's buying cycle goes something like this: emotional
decision, rational justification. Hang tags provide you the valuable
opportunity to appeal to both considerations. The color or material choice,
your logo, or tagline may all evoke a feeling for a customer, while your
highlighted features and benefits can add the validation necessary to justify
their purchase.
3. They add perceived value: Among the more tangible advantages, when it
comes down to it hang tags also just look great and give a certain oomph to
your apparel that customers will notice. In marketing terminology, a hang
tag adds to your apparel’s perceived value, the customer’s evaluation of a
product’s ability to fulfill a need and provide more satisfaction than a
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competing product. Luxury brands are built on this. It’s the perceived value
that justifies the price.
So, what information do you REALLY need?
In this case, need is a pretty relative term. Unlike custom relabeling, where
certain information is legally required, hang tags can be as varied as the apparel
itself. Since there’s nothing you absolutely must have--though your brand name
would probably help--there’s a lot of potentials to be creative with what
information you decide to include.
A great place to start is to consider the questions a customer might ask before
purchasing your apparel. Are there special features of the product that aren’t
instantly recognizable? Or there a mission statement or a company ethos that
would resonate with your audience? Your hang tag is valuable, but small, a bit of
real estate. Choose what will actively work to sell your product, engage your
customers and create return buyers. Here are a few different things you might
want to include.
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Brand name and/or logo: Your brand name and your logo are probably the
closest things to a must-have. After all, if someone can’t tell whose product they
are buying, the chances of them becoming a return customer are pretty slim. It’s
important to keep on-brand here, avoiding inconsistent typography and making
sure your logo scales well without being significantly altered.
Tagline: Your tagline sums up your company vibe in a concise, catchy way. What
could be a better addition to your hang tag than that?
A brief “About Us”: If you’ve got a manifesto, a back story, or a cause that a
tagline just won’t cover, it’s worth including a lengthier message. What your
company is passionate about matters to your customers and if it’s something
unique to you, they definitely want to hear it.
This is especially important if the part of the proceeds of their purchase goes
toward a charity or fundraiser. Your customers will feel good about contributing
to a bigger cause, and statistics show it can even be a deciding factor when
making a purchase.
Point of contact: Whether it’s your
website, social media handle, email
address (even physical address!) by
including an avenue of contact, you
open yourself up to return
customers. It will allow them to see
your other products, learn more
about your company, tell their friends
and, hopefully, stay in touch. And if
they already liked your tee enough to
buy it, there’s a good chance they’ll
like that hoodie too.
Product information: If your apparel
has benefits or qualities that aren’t
immediately apparent, you’ll
definitely want to include some
additional product information. Don’t
assume everyone can tell your
garment is sweat-wicking, has a
special hidden pocket, or will stay
magically wrinkle-free. Choose to
highlight the specific qualities your
target audience will care about.
Call to action: A call to action asks your customer to do something. Whether it’s
tagging or following you on social media or viewing a specific promotion or
website, always consider what might motivate someone to follow through. Your
call to action can also function as a thank you by providing a discount code
customers can use on their next order.
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Care instructions and fabric
compositions: These bits of
information are important if you’re
selling an entirely bespoke garment
or if there’s a quality of your fabric
you’d really like to emphasize, like
“100% organic cotton”. If not,
consider leaving this off. Your
manufacturer’s tags, or custom
relabeled replacements, will already
have this information listed.
Price and UPC: If you see your
apparel in a bigger retail setting,
you’ll want to include a price and
maybe even a UPC. A UPC, or
Universal Product Code, is a 12 digit
code assigned to retail merchandise
that identifies the product and the
vendor who sells it. You don’t need a
UPC code to sell in a retail setting,
but if you’re planning on selling a lot
of garments, it may help keep things
running smoothly.
Photo or illustration: When you
include a hang tag, your garment
becomes a branded package. Because
of this, an effective design is not only
informative, it’s visually engaging.
While we’ve focused a lot on what
your hangtag says, don’t
underestimate the benefits of
featuring a photo or illustration. An
image can tell a customer a lot about
your brand, the lifestyle its wearer
might embody and will be more eye-
catching than an overly text-heavy
design.
Stand out on the rack: Products,
especially garments in crowded retail
stores, can easily get lost on the
racks. Having a distinctive hangtag
that’s strategically attached to your
product can make it stand out from
the crowd. A distinctive logo, bright
colourful designs, or even a strange
and unique shape; these are all things
which draw attention, and as a result,
make your product stand out from
the rest and help customers identify
your product.
Help customers invest in your brand: By using a hangtag to share your brand’s
unique story, you allow customers to become attached to your brand, and to
foster a sense of loyalty. This is especially true in the case of eco-conscious, locally
made, or one-of-a-kind pieces.
Explain your mission statement and fair trade policy on a hangtag, and this will
allow customers to feel part of something bigger. People are becoming more and
more environmentally conscious and are happier to pay extra if there’s a good
reason to, but they need to see that reason!
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Give easy access to care and pricing information: Presenting this information on
the hangtag makes your brand feel more transparent and helps your customer
make an informed purchase. Many of our clients’ pricing strategies account for
the cost of ethical materials and their own labour, making their products appear
pricier than mass-produced products in the same store.
Asking a fair price (alongside your brand’s story) can help educate customers on
the true cost of consciously designed products. If there’s too much information
for the space available, then a QR code will allow customers to go directly to a
webpage, where you can explain in detail exactly what has gone into the product
they are holding in their hands.
Promote your business: Think of a hangtag as a business card. Use it to not only
sell the product it’s attached to, but to advertise your business at the same time.
Print information on there that draws people to your website. Advertise your
social media channels like Facebook, Twitter, or Instagram. Use the hangtag to
offer discounts on the customer’s next purchase. It’s an opportunity for
promotion as well as simply communicating basic information.
ADVICE ON CREATING A HANGTAG
If you are an emerging designer and
would like to create a hangtag that
does more than simply give the size
and price, then we have these
suggestions:
RESEARCH OTHER BRANDS
Look at other brands in your similar
market space and assess what you
like and don’t like about the
branding.
THE DEVIL IS IN THE DETAILS
Make sure that every detail of your hangtag is well thought out: your typeface,
brand colors, paper texture, and method of attaching the hangtags must match
your overall brand identity, and appeal to your target customer.
GRAB THEIR ATTENTION
You are competing in a sea of other
apparel brands and you want to
impact your customer immediately.
LOGISTICS PLAY A PART
If you are wholesaling, make sure to
leave space for the retailer to include
their SKU and pricing information.
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REMEMBER THE GOLDIE LOCKS RULE
Not too much information, but just enough to make a memorable impression.
USE IT FOR PROMOTION
Include your website and social
media usernames on the card, so
customers can find you later. Maybe
offer discounts or advertise specials.
FIRST IMPRESSIONS COUNT
If a package is expensive, there’s a
perception that the garment is of a
higher quality. If you go that extra
mile with your hangtag, the customer
will notice.
THINK OUTSIDE THE BOX
You can combine different materials, such as hang tags, price tickets, barcode
tags. Show your uniqueness and add an extra eyelet, a gold diamante, or
something special so your customers remember their purchase.
Whichever design you come up with for your hangtags, Image Label Systems can
create them. We take the time to get to know your specific requirements and
create solutions that work for you.
Product packaging is the face your brand presents to the world, so it always pays
to put your best face forward.
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PACKAGING IS A LIFE CELL OF YOUR PRODUCT
LEADLINE
PACKAGING IS A LIFE LINE TO YOUR PRODUCT
Every year, 95 percent of new products fail. The reason is simple: Most customers
don't have the time or energy to weigh the advantages and disadvantages of the
products in their shopping carts, so they use a shortcut to make their decision.
That shortcut is your product's packaging.
First impressions are very important, and your packaging
is often a consumer’s first introduction to the product.
As such, product packaging is a factor that
manufacturers should never overlook. The importance
of product packaging is multi-faceted and can go a long
way in securing a good first impression and lasting brand
loyalty.
ATTRACT BUYERS
When considering the importance of product packaging, it’s crucial to consider
the wants and needs of the consumer. The main goal of creating any product,
after all, is to attract customers and encourage them to buy your product.
Because first impressions are so important to the buying process, well-designed
product packaging can go a long way in putting your product into the hands of
buyers. Choosing a style and colours that will appeal to consumers and encourage
them to pick up your product is very
important, as is choosing high-quality
packaging materials. The product
packaging is a reflection of the product
inside and the brand as a whole.
Therefore, when designing product
packaging, many brands conduct
extensive research into the wants and
needs of consumers to ensure their
packaging is attractive and compelling.
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Packaging counts key part of the product brand and marketing. A unique
packaging can increase the product attractiveness and thus affect to the
willingness to buy the product. Packaging is as important as the product itself. Its
purpose is to stand out from the shelf or website, enhance sales, provide relevant
information on the product and augment interest. Two thirds of people say that
the packaging has an effect on their buying decisions. A packaging can also tell a
whole story about the business behind the product and the product’s
environmental, social and economical impacts. It is a tool to communicate
company’s values and great benefits that the product brings to the consumer.
GREAT PACKAGING IS ESPECIALLY SIGNIFICANT FOR GROWING
STARTUPS BECAUSE IT CAN HAVE A DIRECT IMPACT ON SALES AND A
COMPANY'S OVERALL APPEAL.
MAKING YOUR PRODUCT THE STAR
The colours used in your product packaging play a key role in consumer buying
decisions. Your brain reacts to colours in different ways, so choose your packaging
colours accordingly. For example, products with white packaging convey
simplicity, safety and purity. Colour experts cite that the more colour added to a
product’s package, the less sophisticated the product is. Other colours, like blue,
convey many different meanings. A light sky blue colour is considered more
playful, while a dark navy is considered much more professional. Worldwide, blue
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is the most liked colour, but that doesn’t mean you should automatically choose
the likable colour. It’s important to study your target demographic before
deciding on a colour scheme for your product packaging.
A product’s packaging should highlight its positive attributes, accentuating the
elements that will get a consumer from “thinking about it” to ‘purchasing it’. It
should be consistent with your overall branding efforts, from color scheme to
fonts and images used. It should also send a clear message – is your brand all
about luxury, or having fun, or being environmentally responsible and all-natural?
The types of materials, colors, and images you use in packaging should all point to
your overall branding theme. Packaging designs that incorporate clear plastic
windows into cardboard designs or rely on clear plastic folding cartons have the
added advantage of literally showcasing your product, displaying it while the
same time being able to highlight key features with text and illustrations.
…IT DIFFERENTIATES
YOUR BRAND FROM
OTHERS
There are thousands of
products on the market
vying for your
customers’ attention.
According to The Paper
Worker, one-third of a
consumer’s decision
making is based solely
on product packaging.
To succeed, your brand
packaging has to stand
out and look different
from your competitors.
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PRODUCT PACKAGING IS A MARKETING TOOL
You know what makes your product
exceptional and unique, but the
average consumer in a retail venue
might not. The goal of marketing is to
develop your brand and make it
appeal to consumers, and the
packaging you choose plays an
integral role in this process. Nothing
defines the image or solidifies a
consumer’s impression of your
product more than its packaging.
Your product’s packaging can be a
helpful marketing tool through in-
store advertising. Branded products
are easily recognized, so designing
packaging with your logo front and
centre helps consumers remember
your product next time they are
shopping. Consider what your
packaging is saying about your
product and your brand. Is it good?
Can it be better? It’s also wise to
think about what messages your
product’s packaging is conveying to
shoppers and consumers.
STAND A PART AS A LEADER IN YOUR CATEGORY
When your brand is one in a sea of competing products, standing out on the shelf
is of the utmost importance. Visual appeal plays a key role, but the packaging
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design itself can also set your brand apart. An elegant, durable, or convenient
packaging design will stand out from the crowd, and by extension will make your
brand seem like it, too, is on the cutting edge of innovation and design.
PACKAGING TO MATCH YOUR BRAND’S QUALITY AND RECOGNITION
Subconsciously, consumers will
associate the qualities of your brand’s
packaging with the products
themselves. Whatever your branding
goals may be, CPP is committed to
finding unique and creative packaging
solutions that allow your brand to put
its best foot forward. Don’t risk your
brand’s image with packaging that
misses the mark – contact CPP
Insights at
insights@creativeprintandpack.com
for a consultation on your packaging
needs.
Take a moment to think about some
of your favourite brands. They all
have one thing in common: they are
memorable. Over the decades,
brands like Coke have made minor
changes to their packaging and
stayed true to their original look.
Keep in mind that recognizable
brands should not change a thing
because many successful brands that
changed their logo, colours or
packaging have seen a sort of
backlash from shoppers after making
a big change.
Consider eco-friendly options. Packaging that's recyclable or reusable is always a
reason for a consumer to choose your brand over your competitor's. In fact, 52
percent of people around the world make purchase decisions partially due to
packaging that shows a brand making a positive social and environmental impact.
Remember, your product's packaging is meant to communicate a purpose: what
your brand stands for and what it means for your customer. Don't miss this
opportunity to create a lasting impression on the shelf and in the minds of your
customers.
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The Complete Print and Packaging Guide
SCAN AND WATCH

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CPP INSIGHTS - JULY 2021

  • 1. INSIGHTS LEADLINE Issue 5 | July 2021 World's First Concept-Oriented Print and Packaging Magazine Packaging is a life line to your product AN EFFECTIVE HANG TAG Know how it grab your customer attention TRENDING Sustainability in Packaging, Worldwide coverage CPP www.creativeprintpack.com
  • 2. World's First Concept-Oriented Print and Packaging Magazine EDITOR IN CHIEF CONTENTS Raghu Kacharagadla raghu@creativeprintandpack.com CPP INSIGHTS WRITER CPP Insights Team insights@creativeprintandpack.com GRAPHIC DESIGNER CPP ID Team design@creativeprintandpack.com DIGITAL TEAM Think Beyond Creativity tbc@creativeprintandpack.com FOUNDER AND MANAGING DIRECTOR KONDAIAH CHOWDARY P Copyright© 2021 CPP INSIGHTS AN EFFECTIVE HANG TAG : P27-P36 Know how it grab your customer attention SUSTAINABILITY : P2 -P25 Sustainability in Packaging, Worldwide coverage LEADLINE : P37-P41 Packaging is a life line to your product
  • 3. CPP INSIGHTS A UNIQUE PLATFORM OF PACKAGING CPP INSIGHTS BUILD BRANDS We are a house of creators, thinkers, artists, and scientists. As an extension of your team, we’ll work with you to build an innovative brand that gets meaningful results. We know great design, and we believe that inspiration and creativity come from anywhere. We never stop challenging ourselves to think differently and produce compelling ideas. From packaging to brand identities, we thrive when we are able to flourish alongside our clients. THE BUSINESS OF BEING CPP INSIGHTS Since 2007, we’ve been known for our top-notch packaging and branding skills, our passion for meshing strategy with creativity, and our willingness to take risks. We don’t believe in cookie-cutter packaging and branding solutions and our service is truly customized to meet the unique needs of each client. We thrive when we are able to grow alongside our clients and watch them succeed. 1 2 INTR’O’
  • 4. THE DESIGN & PACKAGING From full brand identities and package design to Branding, we’re known for delivering quality creative services. Here’s a glimpse at what we can design and manufacture for you...  Mono Cartons  Corrugated Boxes  Hang Tags  Barcode Tags  PP & PET Boxes  Paper Bags  Rigid Boxes  PDQ Boxes 3 Start Love with us: insights@creativeprintandpack.com
  • 5. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 1 of 42
  • 6. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 2 of 42 SUSTAINABILITY IN PACKAGING: INVESTABLE THEMES Mapping five industry-shaping trends uncovers specific investable themes for participating in sustainable packaging. IVE KEY TRENDS are emerging that will shape sustainable packaging and related investable themes over the next few years. First, consumers are highly aware of sustainability issues, with their concerns accelerating, but they remain confused. Second, in response to public outcry, sustainability regulation for packaging is now both global and increasingly ambitious, but it has become a complex landscape for corporations to navigate (with accelerating consumer sentiment also making it harder for companies to plan reliably). Third, across regions there are critical gaps around waste collection, recycling systems, and technology, limiting significant changes in the packaging value chain over the near term. Fourth, leading fast-moving consumer goods (FMCG) companies and retailers remain committed to transforming their portfolios, but large-scale market adoption of innovations is slow. Lastly, until further notice, plastics are here to stay, with an emerging green premium on the recycled raw material. Additionally, sustainability in packaging needs to be managed to reflect regional differences and in conjunction with megatrends. In response to this emerging outlook, specific investable themes across the full packaging value chain can be seen. In order to avoid missing out on any of these themes, we suggest starting with a few questions regarding materials and processes. IVE KEY INDUSTRY-SHAPING TRENDS IN SUSTAINABILITY What is in store for the packaging industry over the next three to five years in terms of sustainability? What are some emerging theses for institutions looking to invest in the space (or for current players in the packaging value chain looking to diversify beyond their current portfolios)? To find answers, we conducted extensive interviews and discussions with FMCG companies, retailers, and packaging industry executives and experts in major end-user markets across regions. We also applied the findings from our ten-country survey to capture F F
  • 7. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 3 of 42 consumer attitudes around sustainability in packaging. Our analysis has identified five major industry-shaping sustainability trends (exhibit). CONSUMERS ARE HIGHLY CONCERNED, YET THEY ARE CONFUSED Global consumers are increasingly worried about the environment and the impact of packaging leakage. While buyers claim to have high willingness to pay for more sustainable packaging, purchasing choices are still largely driven by other factors (such as brand, quality of products, and economics). For example, US consumers rank overall sustainability relatively low as a buying criterion among end-use factors; they regard price, quality, brand, and convenience as more important. We see a similar pattern for global consumers. Moreover, consumer attitudes are not always scientifically consistent: for example, our global survey finds that consumers rank plastic packaging that is either made from compostable materials or is recyclable as quite sustainable, yet they simultaneously rank plastic containers and bottles made from such recycled materials as among the least sustainable. Going forward, given the current situation, we expect consumers to remain concerned while various stakeholders such as FMCG manufacturers, retailers, and packaging companies ramp up their educational campaigns. In the coming years, we would also expect that brand owners will address the carbon intensity footprint of the product as well as its packaging in a more transparent way by implementing “carbon intensity labels.” First movers of such labels 1
  • 8. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 4 of 42 are already present in areas such as consumer electronics. INCREASING AND ACCELERATING COMPLEXITY OF THE REGULATORY ENVIRONMENT HINDERS PLANNING New regulation is expanding on multiple fronts and is becoming ever stricter. At the same time, regulatory focuses and approaches vary considerably by region and diverge even further when looking at country, county, and city-level regulations. Understanding this variation will require a granular approach. Meanwhile, the number of new sustainability regulations is accelerating and becoming more ambitious. Beyond plastic bans, plastic taxes have started to be introduced in Europe, with recovery schemes to be developed on a national level.1 Taken together, these trends limit companies’ ability to plan reliably and make navigating the landscape even more complex, especially for multinationals. CRITICAL GAPS IN THE VALUE CHAIN EXIST, LIMITING NEAR-TERM MAJOR CHANGE With demand for packaging showing strong, global growth, leakage or unmanaged dumps of packaging have increased. In particular, plastics have low overall recycling rates: globally, only about 16 percent of all plastic waste is reprocessed to make new plastics, and the majority is either incinerated or sent to landfill. In the United States, for example, key drivers of the low recycling rate of plastics are several critical gaps in the value chain around recycling system capabilities and economics. For example, current sorting technology cannot effectively handle approximately 30 percent of plastic packaging. In addition, coordination across the value chain is complex to scale, with recycling operations fragmented across geographies. FMCG companies and retailers remain committed, but market adoption of innovation is slow With consumers increasingly aware of and more vocal about their sustainability concerns, and with growing regulatory pressure, leading FMCG companies and retailers have made strong commitments to sustainability. However, transforming the packaging portfolio has proved to be challenging, with the need to manage complex trade-offs 2 3 4
  • 9. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 5 of 42 encompassing multiple implications for sustainability—for example, achieving high recyclability versus a low carbon footprint. Meanwhile, options can be restricted because of often slim margins and important branding implications. In addition, what is technically and economically feasible to realize will vary by geographic region. Nevertheless, despite these challenges, FMCG manufacturers and retailers continue to deliver innovations in a bid to achieve their own sustainability commitments for packaging in two specific areas:  Recyclable or alternative materials. Recent years have seen a steady introduction of new materials, technologies, and coatings to help address the sustainability challenge.  Markets for reusable or returnable. Circular systems of packaging are not new; several countries still have a national system for managing returnable packages such as beverage bottles. However, extensions of this concept are now emerging whereby consumers also return packaging and refill on the go (examples include food service and in-store dispensing systems), and there also are new options for return and refill at home (for example, e- commerce packaging or refill pouches). While these innovations are moving us in the right direction, broad market implementation has yet to break through. Instead, implementation has mainly been seen among a limited range of SKUs and within country-specific pilots. One challenge is that the majority of innovations to date are typically far less cost effective, efficient, or convenient than incumbent packaging. UNTIL FURTHER NOTICE, PLASTICS ARE HERE TO STAY, WITH AN EMERGING GREEN PREMIUM ON THE RECYCLED RAW MATERIAL With current infrastructure gaps and technical challenges in transforming packaging portfolios, leading brand owners seem not to be making big shifts away from plastic packaging—for now. Instead, they are working on improving the use of plastics by consolidating the types of plastic used (with a focus on improving recyclability), decreasing new plastic resin usage, and accelerating the use of other recycled materials. Globally, there is increased demand for recycled plastic materials in not only packaging but also textiles and other applications. With low global recycling rates of plastics, gaps in infrastructure, and continued expansion in demand, there is a growing green premium for access to 5
  • 10. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 6 of 42 high-quality volumes of recycled plastics. This is likely to remain as long as there is a supply–demand gap, but it will differ according to region. MPACT OF OTHER MEGATRENDS AND REGIONAL DIFFERENCES Not surprisingly, sustainability is not the only trend affecting the packaging industry. Trends such as the shift to e-commerce, rapidly changing consumer preferences with high price sensitivity, consumers focused on health and wellness, and digitalization are here to stay. In particular, we have seen food safety and hygiene grow as a key concerns for consumers in the COVID-19 pandemic alongside an increased share of packages sold via e-commerce channels. Additionally, reasonable cost and convenience continue to be “must- haves” for packaging. At the same time, the strength and pace of these trends can differ significantly by region: our research has revealed common global themes, but also sizable differences in perception. Similarly, the regulation strength differs by country and region, just as much as recycling infrastructure does. NVESTABLE THEMES AND HOW TO START TO ADDRESS THEM Against this backdrop of increased pressure from regulations and consumers, we see several specific investable themes relevant to the sustainable- packaging agenda. IMPROVE PACKAGING RECYCLABILITY. This concerns packaging and raw materials that are more conducive to recycling or enabling technologies that improve recyclability. For example, we have seen numerous R&D efforts to develop recyclable, high-barrier mono-materials (such as all-polyethylene materials or components). It could also include nonpolymer substrates; several paper and board producers have developed fiber-based materials such as molded pulp or functional papers to replace polymers. Finally, improved packaging recyclability also encompasses technology that enables improved sorting and subsequent recycling of the packaging (such as digital bar codes). INCREASE USAGE OF RECYCLED CONTENT IN PACKAGING. An investable theme could include either supporting infrastructure system development or expanding current recycling capacity beyond polyester (PET) to cover emerging recycled polymers such as polypropylene (PP) and polyethylene (PE). Similar to I I
  • 11. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 7 of 42 the theme of recyclability, enacting digital technology changes could also enable increased usage of recycled materials (for instance, to improve sorting). Scale up usage of compostable packaging. This theme includes implementing raw materials or packaging that can be composted, often based on using renewable resources such as fiber- or starch-based raw materials. It could be interesting to look at opportunities that would enable at- home or community composting schemes given the few industrial composting facilities that exist globally. One challenge is the limited barrier properties of some compostable packaging that inhibit large application areas. Another area to consider could be innovating new coatings or adhesives that would enable the composting of the material and support scaling this application to other end-use areas. INTRODUCE REUSABLE AND RETURNABLE PACKAGING. An investable theme could center around systems for using returnable or refillable containers and packaging. However, scalability is yet to be proved for many of these models, and refill-and-reuse approaches are still in their infancy (even though they are a proven concept historically). The rise of e- commerce specifically can lead to an increase in reusable and returnable packaging, pivoting from the mostly one-way flow of packaging currently in use. DEVELOP NEXT-GENERATION LIGHTWEIGHTING. One of the evergreen packaging trends, light weighting is expected to accelerate further based on two factors: first, it will allow for less material usage and, second, it may lead to lower transport-related emissions. Investments could be centred on technology to enable this approach or on innovations in materials to replace current packaging with lighter materials. Moreover, while previous light weighting trends have spurred the rise of multilayer materials, we would expect increased focus on high- barrier mono-materials to allow for both lightweighting and high recyclability.
  • 12. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 8 of 42 LOWER OVERALL CO2 FOOTPRINT AND MAKE THE CARBON INTENSITY OF MATERIALS, PACKAGING, AND PRODUCTS MORE TRANSPARENT. Previous research has shown that packaging material can account for more CO2 than the actual product contained. In light of this and their sustainability commitments, FMCG manufacturers and retailers are exploring switching toward lower- emission substrates—and players operating in substrates with typically higher emissions are exploring more carbon-neutral packaging via shifts to green-energy usage or even carbon- offset or storage options. Thus, technologies or packaging products that offer a relatively lower carbon footprint now or in the future compared with incumbent packaging stand to benefit from the global trend to reduce greenhouse gas emissions and can become differentiators. This can be fueled by ambitions from some FMCG players to increase emissions transparency by printing the carbon footprint on the packaging. Such carbon-intensity labels that create transparency for customers could have a large impact on the packaging value chain and result in a need for packaging redesign and further shift substrate usage to lower-carbon-footprint materials (which may not necessarily be recyclable). Opportunities arising from these themes can be applied across the packaging value chain—but investors will need to be aware of regional and product differences because these might drastically change the outlook for potential investments. Given different regulatory regimes and consumer behaviors, regional differences might indeed change the business outlook, with packaging solutions facing significant variation in terms of consumers’ willingness to pay for sustainable solutions. This complexity cannot be overestimated and requires in- depth analysis. To get started with addressing investable theme opportunities, we suggest a few material questions: HAT GRANULAR SUSTAINABLE-PACKAGING OPPORTUNITIES ARE AVAILABLE? We suggest conducting a rapid but broad scan of companies offering the most promising sustainable solutions for the regions and applications in focus (without forgetting to address regulatory developments). W
  • 13. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 9 of 42 HAT ARE THE BIG BETS ON FUTURE MATERIALS AND PACKAGING? Based on the sustainability scan, categorize what are the most feasible and actionable opportunities to capture a premium from sustainability innovation over the short term versus the long term. It will be important to understand the actionability: that is, how rapidly companies’ innovations can be scaled, as well as their potential cost competitiveness and barrier performance versus incumbent materials. HAT ARE THE OPPORTUNITIES BEYOND INNOVATIONS IN PACKAGING AND MATERIALS? This would include opportunities to facilitate the circular business case around infrastructure and other technology to advance the recovery, reuse, or recycling of previously used materials (for instance, chemical recycling). It could also include scanning and understanding solutions to minimize leakage into the environment (such as digitally enabled technologies in sorting and recycling). Sustainable packaging is a rapidly evolving area. Multiple attractive investment themes are available to achieve large-scale improvements toward more environmentally friendly packaging with an attractive growth profile. However, it will require a granular approach and deep understanding of actionable solutions to identify attractive themes that are truly scalable. W W
  • 14. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 10 of 42 SUSTAINABILITY IN PACKAGING: CONSUMER VIEWS IN EMERGING ASIA Rising sustainability concerns within developing Asia, a key growth vector, make understanding the consumer perspective critical to capturing the growth opportunity for packaging companies. ith China having displaced the United States as the largest global packaging market, Asia remains packaging’s top growth market. As the use of packaging in Asia continues to soar, so too does the ecological burden, with significant leakage of packaging materials into the environment— often as a consequence of lack of waste collection and recycling systems at a scale needed to match strong growth in demand. How are these impacting consumers’ views on sustainability in packaging? To understand this better, we launched a survey across ten countries, including three fast-growing emerging Asian economies (China, India, and Indonesia), to explore consumers’ attitudes. Our findings built on prior work focusing on consumer sentiment globally and an earlier deep dive into consumer sentiment in the United States. Survey respondents revealed both overarching and more country-specific findings. Three key highlights can be observed. First, consumers in China, India, and Indonesia all feel more strongly than most others about sustainability problems. They also claim to have the highest willingness to pay for green. Second, in all three countries, consumers’ top concerns are centered around water and air pollution and less so around waste production, which is viewed with more concern in other surveyed countries. Echoing our global findings, consumers also perceive sustainable packaging to be a top priority for food-related products; however, the specific food sub segments viewed as most important differ by country. All three generations of consumers surveyed across the three countries are highly concerned about the environmental impact of packaging. Overall, Generation X demonstrates the highest level of environmental concern across W
  • 15. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 11 of 42 different sustainability issues, followed by Gen Zers, millennials, and baby boomers, respectively; however, there is some granular variation. Third, while surveyed consumers align on their perception of the most unsustainable packaging material, country-specific views differ on the most sustainable—similar to global findings. Looking ahead, what consumers wish to see more of is recyclable or compostable plastics films, as well as more fiber-based packaging. Emerging Asia remains the key growth market for many packaging companies to target. With a strong increase in concern around sustainability, it will become critical to think through the “green narratives” of any growth strategy along with related strategic options. In order to seize the opportunity, we recommend considering three factors in your strategic planning.
  • 16. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 12 of 42 EMERGING ASIA REMAINS THE KEY GROWTH MARKET FOR MANY PACKAGING COMPANIES TO TARGET. SUSTAINABILITY CONCERNS RISE STRONGLY IN EMERGING ASIA Over the past decade, the global packaging industry has enjoyed steady growth, with the economic boom in emerging Asia being a key growth driver. Headline changes include strong growth of organized retail and increased use of packaging to accommodate consumer demand for convenience. This strong growth in packaging has led to an increased environmental burden due to a frequent lack of the fully developed packaging-collection and recycling systems at a scale needed to manage increased waste. This has not gone unnoticed in the region. Pressure to reduce packaging waste has risen sharply, along with actions by fast-moving consumer goods (FMCG) manufacturers, retailers, and legislators. Despite these measures, consumers in our survey continue to be highly concerned, with respondents in China, India, and Indonesia, together with respondents in Brazil, demonstrating
  • 17. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 13 of 42 the most concern globally—concern that has increased since the COVID-19 pandemic (Exhibit 1). There is a similar finding when it comes to consumers willingness to pay for green packaging: significantly higher willingness to pay for sustainable food packaging is observed in China, India, and Indonesia compared with other surveyed countries around the world. Similar to those countries, Brazil also shows a high willingness to pay for green compared with the other surveyed countries. This demonstrates the relatively high level of consumer awareness in these markets and the critical need for stakeholders to take action. Two further questions related to the above findings then follow: what are consumers in emerging Asia concerned about, and who is driving that increased concern? On the first question, views across the three countries in focus are quite
  • 18. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 14 of 42 aligned: consumers perceive water and air pollution as key areas of concern. This differs from other surveyed countries, such as Japan, and in Europe where marine litter is perceived as a higher concern. Consumers in the United States and the United Kingdom also point out that waste production is a major concern, while India and Indonesia ranked this as one of the least important issues. The categories in which consumers consider sustainable packaging most important differ somewhat between countries—although all focus on food-related products. In China, priority centres on fresh fruit and vegetables, fresh meat, and dairy products. In India, the highest importance is given to fast-food packaging, followed by dairy products and pet food. Indonesia ranks beverages highest, followed by dairy products, and fresh fruit and vegetables. When looking more closely into the second question—who is driving the increase in concern—we find that actually all consumer groups are concerned. Overall, Gen Xers show the highest levels of concern, followed by Gen Zers and millennials, and baby boomers (Exhibit 2). Looking at the two key areas of concern—air and water pollution—Generation X is particularly concerned in Indonesia, while there is more variance in China and India.
  • 19. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 15 of 42 McKinsey survey indicates that consumers around the world disagree about what they see as the most sustainable packaging materials; however, there is more consensuses on what they regard as the least sustainable materials. Among our focus countries, consumers in China and Indonesia perceive plastics that are either compostable or recyclable as being more sustainable (a view similar to that of Brazilian consumers). This differs from consumers in India, who perceive paper and glass as more sustainable. Overall, consumers are looking for more recyclable or compostable plastic films and more paper-based packaging (Exhibit 3). Recyclable, rigid plastics rank quite low, and so do both glass and metal.
  • 20. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 16 of 42 Many packaging companies target emerging Asia as a vital growth vector, and they also need to develop strategies for success. Examples include identifying opportunities to serve the target market (for example, high-end market versus mass market); determining which customers to target (multinational versus local); adopting the best strategy (such as unit-cost leadership versus innovation leadership); and approaching growth strategy (organic growth versus acquisitions). However, with a strong rise in sustainability concerns in the region, this will not be enough. Accordingly, packaging companies should consider three further elements:
  • 21. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 17 of 42  First, understand how local consumers use products and dispose of the packaging. Our findings show some common regional themes around sustainability, particularly linking high awareness and willingness to pay. There is also an emerging wish among surveyed consumers to see more recyclable or compostable plastic films and paper-based packaging in the future. Inevitably, when looking at a more granular level, there are multiple differences between the countries and among end-use segments, which require a deeper understanding of the focus markets. Therefore, there isn’t a collective regional solution for determining what packaging will work best and what sustainability levers to pull. In most cases, we suggest using the emerging cross-country themes as a base view supplemented by granular field research to further inform strategic planning. This should include comprehensively mapping out cradle-to-grave packaging journeys from filling to usage and disposal. Such insights will serve as a starting point for understanding the strategic options that exist around the fit of the packaging for a given value chain and the range of improvement levers available.  Second, take an incremental approach, and act sooner rather than later. Even with the indicated high willingness to pay for green, this doesn’t necessarily translate into real consumer action. On top of that, consumers may not always know what to expect or exactly what they want. Given the high urgency to act, we therefore suggest considering available “low- hanging fruit” actions initially. These should be actions that can be taken with little to no impact on operating costs or capital-expenditure needs, functionality, or attractiveness of the packaging. For example, decrease complexity, remove unnecessary use of packaging, conduct a light redesign to improve recyclability, and, where possible, consider material substitutions for more mono-materials. Once these actions have been successfully implemented, companies can then consider addressing system- level changes that require in-depth value-chain collaboration.  Third, ensure clear communication around sustainability narratives for both product and packaging. It is apparent from our survey that consumers would be willing to buy more sustainable products if they knew what they were buying. Ensuring that the packaging can communicate the
  • 22. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 18 of 42 sustainability narratives relevant to local consumer concerns will be essential. Also, in the context of increased local and global regulation around sustainability, using packaging to further inform consumers about how a product can be recycled will be vital. Viewing sustainability issues as a key factor in strategic planning will enable packaging companies to determine how sustainability can be used as a differentiator to attract consumer interest and drive growth. Environmental concerns are top of mind for consumers in emerging Asia. Viewing sustainability issues as a key factor in strategic planning will enable packaging companies to determine how sustainability can be used as a differentiator to attract consumer interest and drive growth.
  • 23. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 19 of 42 SUSTAINABILITY IN PACKAGING: INSIDE THE MINDS OF GLOBAL CONSUMERS In the wake of the COVID-19 pandemic, some global themes regarding consumer sentiment are evident. But perceptions and priorities regarding packaging differ by country and require a granular response. ustainability remains a key topic for the packaging value chain, but there are few (if any) insights into consumer perceptions globally—especially now that the COVID-19 pandemic is also influencing consumer sentiment and behaviour. To better understand this influence, we launched a survey across ten countries to explore consumers’ attitudes toward sustainable packaging, building on our earlier work focusing on consumer sentiment in the United States. Consumers who took part in the survey have uncovered three main findings. First, as a result of the COVID-19 pandemic, consumers now place significantly more value on food safety and hygiene. This is a key element of the next normal in packaging, whereby packaging suppliers will have to rethink materials and design requirements. Second, consumers see sustainability as being increasingly important as we emerge from COVID-19: marine litter is top of mind in Europe and Japan, while pollution is more of a concern in other Asian countries and the Americas. Across the globe, a vast majority of consumers claim to be willing to pay more for sustainable packaging. Third, consumers around the world disagree on what packaging type is most sustainable; however, they do agree on what are the least sustainable options. Thus, to respond effectively to these evolving consumer sentiments, a granular view will be needed. In this article, we suggest three critical questions that S
  • 24. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 20 of 42 packaging players need to answer to get started on creating an actionable fact base on which to build their future strategy. To better understand this influence, we launched a survey across ten countries to explore consumers’ attitudes toward sustainable packaging, building on our earlier work focusing on consumer sentiment in the United States. COVID-19’S IMPACT ON SUSTAINABILITY IN PACKAGING Ahead of the COVID-19 crisis, sustainability was top of mind across the whole packaging value chain. Consumers were becoming acutely aware of the packaging sector’s environmental footprint, and, in turn, rising public awareness sparked responses from legislators around the world. With sustainability increasingly part of their value proposition, fast-moving-consumer- goods (FMCG) and retail companies promised swift action and made bold commitments to improving the recycling potential of their packaging. This combination of downstream pull from consumers along with FMCG companies responding to the regulatory push had a profound impact on upstream players in the packaging industry: they were expected to help meet commitments. However, during the early stages of the pandemic, hygiene concerns took priority over the drive to eradicate single-use packaging in several jurisdictions. This evolution in consumer sentiment is also reflected in our survey, which indicates that the pandemic has heightened concerns around food safety, especially in the hardest-hit countries (Exhibit 1).
  • 25. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 21 of 42 THE NEXT NORMAL OF SUSTAINABILITY IN PACKAGING As we enter the next normal, pressure on sustainability is building once again. FMCG manufacturers and retailers continue to innovate with new packaging formats designed to improve recyclability—notably with the use of recycled content such as post-consumer resin (PCR)—as they approach their own sustainability commitments and also respond to consumer expectations, critical nongovernmental organization voices, and regulatory pressure. New regulation is currently expanding on multiple fronts: no longer is it confined to just a few countries or regions. Today, sustainability regulation has become much more of a global phenomenon, even if the level of regulation varies. At the same time, consumer concerns remain: when we asked consumers about their perceptions of packaging sustainability compared with pre-COVID-19 times, only 4 to 11 percent of consumers globally said that they are now less concerned. Consumers are generally more concerned in developing economies such as India (87 percent of consumers are more concerned), Indonesia (80 percent), and Brazil (65 percent). Nevertheless, consumers in more developed economies are also
  • 26. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 22 of 42 showing higher awareness around sustainability issues: for example, 48 percent of US consumers are more concerned. However, what consumers are concerned about differs depending on region (Exhibit 2). In all countries surveyed, the overwhelming majority of respondents claim to be willing to pay more for sustainable packaging across end-use areas. In food service, for example, highest willingness to pay is in China, where 86 percent of consumers say they are willing to pay “a lot” or “a bit more” for sustainable packaging, followed by Indonesia, the United States, and Brazil (75 percent, 68 percent, and 66 percent, respectively). In Germany, Italy, India, and the United Kingdom, around 56 to 59 percent say they are willing to pay “a lot” or “a bit more” for sustainable food-service packaging. Willingness to pay more for green in food service appears lowest in Japan and France, where 48 percent of consumers are willing to pay more for sustainable packaging. At the same time, better labelling on the packaging (explaining its sustainable attributes) and increased availability would encourage 23 to 61 percent of the surveyed
  • 27. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 23 of 42 consumers to buy more green packaging. Taken together, these facts plainly suggest that a clearly communicated sustainability benefit is a strong value proposition for packaging suppliers. SUBSTRATE VIEW: WHAT DOES THE GLOBAL CONSUMER PREFER? It is often wondered what packaging substrate is seen as the most sustainable by consumers. Our survey indicates that consumers around the world disagree about what they view as the most sustainable packaging materials, but their perception is quite aligned on what they regard as the most unsustainable materials (Exhibit 3).
  • 28. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 24 of 42 Paper-based cartons rank quite high for sustainability in the United States and among surveyed countries in Europe, as does glass. However, this is not the case in Brazil, China, and Indonesia where both types of packaging are ranked much lower. Compostable plastic films have a strong global recognition as being sustainable.
  • 29. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 25 of 42 Packaging combining plastic, paper, and aluminium foil (for example, flexible packaging) ranks lowest from a consumer perspective across all surveyed countries. Additionally, aluminium foils, plastic bottles (even with recycled content), and metal containers rank on the lower part of the spectrum. THREE CRITICAL QUESTIONS TO CONSIDER Packaging suppliers should take a strategic look at their portfolios and assess them with three key questions in mind:  What are the substrate shifts you can foresee in your focus markets based on anticipated consumer perception and regulatory changes?  What is the resulting value at stake (that is, where are you most exposed given this and your market position)?  What are the potential growth opportunities for which you would be uniquely positioned to provide winning solutions? Answering these three questions will help to create an actionable fact base. Based on this, packaging suppliers should update and enhance their product- and technology-strategy road map with relevant sustainability narratives. Doing so will help to identify growth opportunities and the partners needed to deliver them and provide insight into areas of risk in instances where volumes might move to alternative substrates if no solution can be developed. Consumer sentiments seem to be shifting continuously, most recently with heightening focus on food safety and hygiene. Understanding consumers’ sentiments and preferences around sustainability at a granular level will be a key early indicator for the value chain as to future regulatory pressure and instances where large packaging-substrate shifts could occur. Proactively identifying these sentiments and potential shifts could allow packaging suppliers to stay on top of trends as they develop and to become a thought partner by supporting customers in revamping their packaging portfolio—ultimately creating significant growth opportunities.
  • 30. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 26 of 42 DID YOU KNOW The Chinese takeout box with its Japanese- influenced origami folds is actually an American Invention. On November 13, 1894, in Chicago. Inventor Frederick weeks Wilcox patented his ‘paper pail’ a single piece of paper creased into segments and folded in such a way as to create a leak-proof container which he secured with a wire handle. ------------------------------------------------------------------------------
  • 31. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 27 of 42 AN EFFECTIVE HANG TAG angtags are the labels attached to clothing that usually contain the basic information about the item. Size, price, brand… all this can be found on the hangtag. But what is now becoming more prevalent in the industry is the practice of using hangtags as another weapon in the battlefield of marketing. Although many people think they are just there to tell the customer how much the item costs, hang tags are a branding opportunity that is often overlooked in the retail industry. Not only are they important for the end-user, but they can support brand identity and increase awareness. From what a hang tag means to the consumer to the different finishes available to further your branding, learn about the importance of the underestimated hang tag. H
  • 32. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 28 of 42  What a Hang Tag Means for the End User of Your Product  A Famous Hang Tag That Demanded Attention and Broke Through the Noise  More Important Than Ever: Eco-Friendly Retail Hang Tags  Different Finishes Can Create a Distinctive Effect for Your Branding WHAT HANG TAG MEANS FOR THE END-USER OF YOUR PRODUCT Hang tags are beneficial for the details that are important to a customer such as sizing, pricing, and brand. But they are so much more than that in today’s bustling retail industry. Here’s just some of the information you could include:
  • 33. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 29 of 42 Care information - Advises the customer on how to wash their garment and makes your brand feel more credible. Material details - This is especially important to environmentally conscious shoppers who want to shop sustainably. Unique selling points - Differentiate your garment from the rest and flaunt its best attributes. A high-quality branded swing tag ensures the customer that the product is of the same standard and adds to its credibility. Also, it gives you the space to demonstrate why they should choose your garment over any other brand. Whether you’re showcasing the standout features that are a major selling point for the garment or including important material information, customers will resonate with this and take notice that the design includes these details that are often neglected. Connecting with consumers has never been more important. A FAMOUS HANG TAG THAT DEMANDED ATTENTION AND BROKE THROUGH THE NOISE Innovative hang tags can be a selling point for your garment and in some cases, will be left on to showcase value, quality, and the brand itself. For example, Off White’s iconic industrial zip tie paired with the black and white striped hang tag. It contrasts with the luxury and expense of the fashion brand and everybody thinks twice about cutting that prestigious tag. This bold statement has created brand loyalty and customers will buy most things with that famous hang tag. It shows that hang tag designs don’t have to be overly complicated and that a well-made one can establish itself as an industry leader. Breaking through the noise isn’t easy, but creating something with the potential to do so is made easier with the creativity hang tags give you. MORE IMPORTANT THAN EVER: ECO-FRIENDLY RETAIL HANG TAGS The fashion industry is one of the major contributors to pollution in the world. People are quickly becoming more educated about the brands they purchase from and their environmental impact. This includes the sustainability of the fabrics used right down to the material of the hang tag.
  • 34. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 30 of 42 Opting for an eco-friendly alternative such as sustainable papers for hang tags and vegetable inks is a step towards reducing the harmful impact fashion has on the environment. Taking a position on sustainability ensures a place within the ever- changing industry. DIFFERENT FINISHES CAN CREATE A DISTINCTIVE EFFECT FOR YOUR BRANDING When your product is competing amongst others in an oversaturated retail environment - you need to stand out. Hang tags play a vital role in brand awareness and you’re missing the chance to extend your narrative if you’re not utilizing them. You’re no longer restricted to the traditional rectangle hang tag with the usual plain font price, sizing, and logo. Bespoke clothing branding specialists can give you the tools to make truly individual garment trims. Using cutting-edge printing techniques, you can create compelling designs for your retail hang tags that not only make an impact but are in line with your branding. Matte Lamination - Create a soft and subdued look with this technique that works well with a minimalistic design to really create a sophisticated hang tag. Foil Stamping - Enhance the look of your hang tag by bonding metallic foil to create a highly visual and attention-grabbing finish. Embossing - Using heat you can accomplish a raised effect which works especially well to make logos stand out against an intricate background. These are just a selection of innovative printing techniques that you could use on your hang tags. But as you can see, you really do have the power to create totally unique tags. ARE YOU OVERLOOKING THESE INNOVATIVE TAGS, BADGES, AND TICKETS TOO? So you know the importance of hang tags now. But are you neglecting the other important garment trims that could elevate your branding further? We’ve created an all-in-one guide that covers everything you need to know about adding a fashion-forward finish to your garments.
  • 35. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 31 of 42 DESIGNING A HANG TAG? HERE’S WHAT INFORMATION TO INCLUDE Why hang tag your custom apparel? 1. They draw attention: In a retail setting, people come into contact with a lot of brands, often displayed close together with similar products. Anything you can do to differentiate your apparel will help get your brand noticed. 2. They tell a lot about your product and your brand: Any marketer will tell you that a customer's buying cycle goes something like this: emotional decision, rational justification. Hang tags provide you the valuable opportunity to appeal to both considerations. The color or material choice, your logo, or tagline may all evoke a feeling for a customer, while your highlighted features and benefits can add the validation necessary to justify their purchase. 3. They add perceived value: Among the more tangible advantages, when it comes down to it hang tags also just look great and give a certain oomph to your apparel that customers will notice. In marketing terminology, a hang tag adds to your apparel’s perceived value, the customer’s evaluation of a product’s ability to fulfill a need and provide more satisfaction than a
  • 36. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 32 of 42 competing product. Luxury brands are built on this. It’s the perceived value that justifies the price. So, what information do you REALLY need? In this case, need is a pretty relative term. Unlike custom relabeling, where certain information is legally required, hang tags can be as varied as the apparel itself. Since there’s nothing you absolutely must have--though your brand name would probably help--there’s a lot of potentials to be creative with what information you decide to include. A great place to start is to consider the questions a customer might ask before purchasing your apparel. Are there special features of the product that aren’t instantly recognizable? Or there a mission statement or a company ethos that would resonate with your audience? Your hang tag is valuable, but small, a bit of real estate. Choose what will actively work to sell your product, engage your customers and create return buyers. Here are a few different things you might want to include.
  • 37. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 33 of 42 Brand name and/or logo: Your brand name and your logo are probably the closest things to a must-have. After all, if someone can’t tell whose product they are buying, the chances of them becoming a return customer are pretty slim. It’s important to keep on-brand here, avoiding inconsistent typography and making sure your logo scales well without being significantly altered. Tagline: Your tagline sums up your company vibe in a concise, catchy way. What could be a better addition to your hang tag than that? A brief “About Us”: If you’ve got a manifesto, a back story, or a cause that a tagline just won’t cover, it’s worth including a lengthier message. What your company is passionate about matters to your customers and if it’s something unique to you, they definitely want to hear it. This is especially important if the part of the proceeds of their purchase goes toward a charity or fundraiser. Your customers will feel good about contributing to a bigger cause, and statistics show it can even be a deciding factor when making a purchase. Point of contact: Whether it’s your website, social media handle, email address (even physical address!) by including an avenue of contact, you open yourself up to return customers. It will allow them to see your other products, learn more about your company, tell their friends and, hopefully, stay in touch. And if they already liked your tee enough to buy it, there’s a good chance they’ll like that hoodie too. Product information: If your apparel has benefits or qualities that aren’t immediately apparent, you’ll definitely want to include some additional product information. Don’t assume everyone can tell your garment is sweat-wicking, has a special hidden pocket, or will stay magically wrinkle-free. Choose to highlight the specific qualities your target audience will care about. Call to action: A call to action asks your customer to do something. Whether it’s tagging or following you on social media or viewing a specific promotion or website, always consider what might motivate someone to follow through. Your call to action can also function as a thank you by providing a discount code customers can use on their next order.
  • 38. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 34 of 42 Care instructions and fabric compositions: These bits of information are important if you’re selling an entirely bespoke garment or if there’s a quality of your fabric you’d really like to emphasize, like “100% organic cotton”. If not, consider leaving this off. Your manufacturer’s tags, or custom relabeled replacements, will already have this information listed. Price and UPC: If you see your apparel in a bigger retail setting, you’ll want to include a price and maybe even a UPC. A UPC, or Universal Product Code, is a 12 digit code assigned to retail merchandise that identifies the product and the vendor who sells it. You don’t need a UPC code to sell in a retail setting, but if you’re planning on selling a lot of garments, it may help keep things running smoothly. Photo or illustration: When you include a hang tag, your garment becomes a branded package. Because of this, an effective design is not only informative, it’s visually engaging. While we’ve focused a lot on what your hangtag says, don’t underestimate the benefits of featuring a photo or illustration. An image can tell a customer a lot about your brand, the lifestyle its wearer might embody and will be more eye- catching than an overly text-heavy design. Stand out on the rack: Products, especially garments in crowded retail stores, can easily get lost on the racks. Having a distinctive hangtag that’s strategically attached to your product can make it stand out from the crowd. A distinctive logo, bright colourful designs, or even a strange and unique shape; these are all things which draw attention, and as a result, make your product stand out from the rest and help customers identify your product. Help customers invest in your brand: By using a hangtag to share your brand’s unique story, you allow customers to become attached to your brand, and to foster a sense of loyalty. This is especially true in the case of eco-conscious, locally made, or one-of-a-kind pieces. Explain your mission statement and fair trade policy on a hangtag, and this will allow customers to feel part of something bigger. People are becoming more and more environmentally conscious and are happier to pay extra if there’s a good reason to, but they need to see that reason!
  • 39. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 35 of 42 Give easy access to care and pricing information: Presenting this information on the hangtag makes your brand feel more transparent and helps your customer make an informed purchase. Many of our clients’ pricing strategies account for the cost of ethical materials and their own labour, making their products appear pricier than mass-produced products in the same store. Asking a fair price (alongside your brand’s story) can help educate customers on the true cost of consciously designed products. If there’s too much information for the space available, then a QR code will allow customers to go directly to a webpage, where you can explain in detail exactly what has gone into the product they are holding in their hands. Promote your business: Think of a hangtag as a business card. Use it to not only sell the product it’s attached to, but to advertise your business at the same time. Print information on there that draws people to your website. Advertise your social media channels like Facebook, Twitter, or Instagram. Use the hangtag to offer discounts on the customer’s next purchase. It’s an opportunity for promotion as well as simply communicating basic information. ADVICE ON CREATING A HANGTAG If you are an emerging designer and would like to create a hangtag that does more than simply give the size and price, then we have these suggestions: RESEARCH OTHER BRANDS Look at other brands in your similar market space and assess what you like and don’t like about the branding. THE DEVIL IS IN THE DETAILS Make sure that every detail of your hangtag is well thought out: your typeface, brand colors, paper texture, and method of attaching the hangtags must match your overall brand identity, and appeal to your target customer. GRAB THEIR ATTENTION You are competing in a sea of other apparel brands and you want to impact your customer immediately. LOGISTICS PLAY A PART If you are wholesaling, make sure to leave space for the retailer to include their SKU and pricing information.
  • 40. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 36 of 42 REMEMBER THE GOLDIE LOCKS RULE Not too much information, but just enough to make a memorable impression. USE IT FOR PROMOTION Include your website and social media usernames on the card, so customers can find you later. Maybe offer discounts or advertise specials. FIRST IMPRESSIONS COUNT If a package is expensive, there’s a perception that the garment is of a higher quality. If you go that extra mile with your hangtag, the customer will notice. THINK OUTSIDE THE BOX You can combine different materials, such as hang tags, price tickets, barcode tags. Show your uniqueness and add an extra eyelet, a gold diamante, or something special so your customers remember their purchase. Whichever design you come up with for your hangtags, Image Label Systems can create them. We take the time to get to know your specific requirements and create solutions that work for you. Product packaging is the face your brand presents to the world, so it always pays to put your best face forward.
  • 41. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 37 of 42 PACKAGING IS A LIFE CELL OF YOUR PRODUCT LEADLINE PACKAGING IS A LIFE LINE TO YOUR PRODUCT Every year, 95 percent of new products fail. The reason is simple: Most customers don't have the time or energy to weigh the advantages and disadvantages of the products in their shopping carts, so they use a shortcut to make their decision. That shortcut is your product's packaging. First impressions are very important, and your packaging is often a consumer’s first introduction to the product. As such, product packaging is a factor that manufacturers should never overlook. The importance of product packaging is multi-faceted and can go a long way in securing a good first impression and lasting brand loyalty. ATTRACT BUYERS When considering the importance of product packaging, it’s crucial to consider the wants and needs of the consumer. The main goal of creating any product, after all, is to attract customers and encourage them to buy your product. Because first impressions are so important to the buying process, well-designed product packaging can go a long way in putting your product into the hands of buyers. Choosing a style and colours that will appeal to consumers and encourage them to pick up your product is very important, as is choosing high-quality packaging materials. The product packaging is a reflection of the product inside and the brand as a whole. Therefore, when designing product packaging, many brands conduct extensive research into the wants and needs of consumers to ensure their packaging is attractive and compelling.
  • 42. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 38 of 42 Packaging counts key part of the product brand and marketing. A unique packaging can increase the product attractiveness and thus affect to the willingness to buy the product. Packaging is as important as the product itself. Its purpose is to stand out from the shelf or website, enhance sales, provide relevant information on the product and augment interest. Two thirds of people say that the packaging has an effect on their buying decisions. A packaging can also tell a whole story about the business behind the product and the product’s environmental, social and economical impacts. It is a tool to communicate company’s values and great benefits that the product brings to the consumer. GREAT PACKAGING IS ESPECIALLY SIGNIFICANT FOR GROWING STARTUPS BECAUSE IT CAN HAVE A DIRECT IMPACT ON SALES AND A COMPANY'S OVERALL APPEAL. MAKING YOUR PRODUCT THE STAR The colours used in your product packaging play a key role in consumer buying decisions. Your brain reacts to colours in different ways, so choose your packaging colours accordingly. For example, products with white packaging convey simplicity, safety and purity. Colour experts cite that the more colour added to a product’s package, the less sophisticated the product is. Other colours, like blue, convey many different meanings. A light sky blue colour is considered more playful, while a dark navy is considered much more professional. Worldwide, blue
  • 43. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 39 of 42 is the most liked colour, but that doesn’t mean you should automatically choose the likable colour. It’s important to study your target demographic before deciding on a colour scheme for your product packaging. A product’s packaging should highlight its positive attributes, accentuating the elements that will get a consumer from “thinking about it” to ‘purchasing it’. It should be consistent with your overall branding efforts, from color scheme to fonts and images used. It should also send a clear message – is your brand all about luxury, or having fun, or being environmentally responsible and all-natural? The types of materials, colors, and images you use in packaging should all point to your overall branding theme. Packaging designs that incorporate clear plastic windows into cardboard designs or rely on clear plastic folding cartons have the added advantage of literally showcasing your product, displaying it while the same time being able to highlight key features with text and illustrations. …IT DIFFERENTIATES YOUR BRAND FROM OTHERS There are thousands of products on the market vying for your customers’ attention. According to The Paper Worker, one-third of a consumer’s decision making is based solely on product packaging. To succeed, your brand packaging has to stand out and look different from your competitors.
  • 44. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 40 of 42 PRODUCT PACKAGING IS A MARKETING TOOL You know what makes your product exceptional and unique, but the average consumer in a retail venue might not. The goal of marketing is to develop your brand and make it appeal to consumers, and the packaging you choose plays an integral role in this process. Nothing defines the image or solidifies a consumer’s impression of your product more than its packaging. Your product’s packaging can be a helpful marketing tool through in- store advertising. Branded products are easily recognized, so designing packaging with your logo front and centre helps consumers remember your product next time they are shopping. Consider what your packaging is saying about your product and your brand. Is it good? Can it be better? It’s also wise to think about what messages your product’s packaging is conveying to shoppers and consumers. STAND A PART AS A LEADER IN YOUR CATEGORY When your brand is one in a sea of competing products, standing out on the shelf is of the utmost importance. Visual appeal plays a key role, but the packaging
  • 45. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 41 of 42 design itself can also set your brand apart. An elegant, durable, or convenient packaging design will stand out from the crowd, and by extension will make your brand seem like it, too, is on the cutting edge of innovation and design. PACKAGING TO MATCH YOUR BRAND’S QUALITY AND RECOGNITION Subconsciously, consumers will associate the qualities of your brand’s packaging with the products themselves. Whatever your branding goals may be, CPP is committed to finding unique and creative packaging solutions that allow your brand to put its best foot forward. Don’t risk your brand’s image with packaging that misses the mark – contact CPP Insights at insights@creativeprintandpack.com for a consultation on your packaging needs. Take a moment to think about some of your favourite brands. They all have one thing in common: they are memorable. Over the decades, brands like Coke have made minor changes to their packaging and stayed true to their original look. Keep in mind that recognizable brands should not change a thing because many successful brands that changed their logo, colours or packaging have seen a sort of backlash from shoppers after making a big change. Consider eco-friendly options. Packaging that's recyclable or reusable is always a reason for a consumer to choose your brand over your competitor's. In fact, 52 percent of people around the world make purchase decisions partially due to packaging that shows a brand making a positive social and environmental impact. Remember, your product's packaging is meant to communicate a purpose: what your brand stands for and what it means for your customer. Don't miss this opportunity to create a lasting impression on the shelf and in the minds of your customers.
  • 46. CPP INSIGHTS | ISSUE 5 www.creativeprintpack.com Page 42 of 42 The Complete Print and Packaging Guide SCAN AND WATCH