FMCG product packaging is at the core of a growing informational system, encompassing regulators, packaging producers, their clients, and consumers. Through the ongoing evolution and roll-out of new forms of smart packaging, its overall impact is increasing beyond the boundaries of a simple product container, says GlobalData, a leading intelligence and productivity platform.

With regulatory changes such as Extended Producer Responsibility and recycled-content mandates proliferating, there is an ever-increasing requirement for proof and traceability. This is making smart packaging essential for accurate reporting, consumer guidance, and compliance across fragmented global regulatory systems. 

Richard Parker, Principal Consumer Analyst at GlobalData, comments: “Regulators’ complex reporting demands combine with opportunities for consumer engagement to increase the prevalence of scannable and trackable features. Furthermore, active materials and on-pack tools like those that can confirm freshness are important practical utilities that, in combination with digital elements, help build confidence in quality and transparency.”

Smart packaging is physical and digital

According to GlobalData’s latest Industry Insight report, Industry Insights: Smart Packaging, smart packaging consists of two segments. Active packaging is where material design and integral features focus on characteristics such as stabilising and extending shelf-lives, using antimicrobial coatings, chemically activated on-pack indicators of temperature, freshness, etc. Digitally smart packaging, or connected packaging, using QR codes, RFID, NFC tags, etc., can communicate both within the supply chain and to consumers.

Smart packaging growth is driven by the need for traceability and real-time monitoring for compliance in areas such as food and drug safety, and environmental responsibility. It also offers brand-consumer engagement, such as education and gamification.

On the other hand, challenges to smart packaging’s adoption are the sheer costs of upgrading production lines and digital infrastructure to process the data effectively. Also, consumers are sceptics, and smart functionality is of much lower importance to them than value-for-money.

Sustainability’s influence on packaging material trends has consequences for how smart function is implemented

Pack material evolution has consequences for smart technology choices and function; the core theme of recycling means codes tailored by material and particular sets of consumer instructions, along with a layer of data for Extended Producer Responsibility and other forms of regulation. This information may also be locally specific – where regional/state rule variations may apply within countries.

Smart packaging can aid brand-consumer relationship building

Consumer tracking and engagement can inform NPD. Smart data can reveal what consumer interest stems from – sizes, flavors, regional variations in appeal, etc. It can also capture direct feedback, as micro-surveys can be placed behind scan codes to capture immediate responses to taste, texture, and limited-edition releases. However, it is important is that smart function on packaging adds genuine value rather than gimmickry. Consumer mindsets must be nurtured to view smart packaging as a practical and advantageous norm.

Parker concludes: “Near-term, the packaging industry and its customers need to work on achieving the right balance between compliance, cost, performance, and customer experience. Smart packaging must be integral, practical, and beneficial to their product and workflow. Key will be investing where it adds most value – that regulatory compliance is met, material choices are optimized, and automation is added where it provides the most benefit. 

“Consumer-focused smart functionality must have a clearly defined target audience, provide essential service benefits, trust, and transparency, and engagement programs must not come across as frivolous or expendable.”