Abstract
This paper aims to discuss, define, and analyze a set of perspectives and potentials of smart interactive packaging applied to CPGs to fill up the space between marketing and physical retailing in terms of knowledge distribution. Smart interactive packaging goes beyond the traditional one-way informational flow and triggers dialogue between the package and consumer at several user touch points. The paper takes into consideration two engaged environments: the retail environment and the use environment, where packaging interacts with the consumer. Due to enabling technologies, smart interactive packaging becomes a channel for story-telling and knowledge distribution among the brand, retailer, and consumer. Authors propose that IoP-enabled packaging converts the story told by the digital marketing into a physical artifact presented on the physical retail shelf, as well as contributes to product improvement and innovation due to collected, assessed and distributed knowledge related to consumer data.
TopIntroduction
In the past decades, the world has experienced the quite significant rate of change and speed of advancement in the consumer market (Mason, 2010). In order to fulfill growing consumers’ demand and requirements, businesses are not only increasing their capacity of production (Aarnio & Hämäläinen, 2008), but also the means to sustain their competitive advantage among others. Consequently, the growing competition has led to the expansion of diverse marketing and branding techniques applied in both digital and physical retail environments. Traditionally, before the industry has begun to shift from information age to communication and interaction, advertising was referred as the principal method for marketing (Ford et al., 2012). However, the conventional mass media approaches were becoming less effective due to decreased impact on consumers and reduced budgets (Clarke, 2017; Ampuero & Vila, 2006). Therefore, businesses were in need to come up with other promising and preeminent marketing tools.
Underwood (2003) and Loucanova et al. (2017) claim that the potential of product’s packaging has been largely overlooked in terms of brand symbolism and communication. Overall, it is the packaging that attracts the consumer’s attention at first (Asgari et al., 2014). It is evaluated that 50-70% of shoppers make their decisions in-store (Lamey et al., 2018). Likewise, 73% rely on packaging, whether to purchase a product or not at the supermarket (Sudbury-Riley, 2014). Krishna et al. (2017) contribute to authors and add that package is the outfit of the product and can directly affect the perception of its quality and functionality, consumer attention and comprehension of offered value; thus packaging cannot be longer used only for preservation and handling purposes. According to the authors, the industry of Consumer Packaged Goods (CPG) packaging is heading to different designing directions due to new trends in enabling technologies, sustainability, functionality, and consumer engagement. Regarding the latter, both Krishna et al. (2017) and Lamey et al. (2018) agree that businesses should manage and design their product development and innovation processes including consumer preferences that is well-defined in the concepts of shopper marketing and sensory marketing. The development of product’s packaging with more sensory-based engaging and interaction frames a unique consumer experience with the aim to create additional value that affects the formation of long-lasting brand-consumer relationships (Krishna et al., 2017).
Key Terms in this Chapter
Customer Journey Mapping: A tool for identifying and analyzing logics, pathways and efficiency of the interaction between an organization and the consumers. It applies both to digital and physical customer interactions. It is motivation by the fact that consumers typically needs to take several actions to obtain a service or goods. Like “find good”, “place in cart”, “go to cashier line”, “pay” as a positive examples.
Customer Touchpoint: Any point of encounter of between a product or service offering and consumers. In physical business, it relates to all types of physical impressions and interactions leading to customer satisfaction or dissatisfaction. In digital business, it relates similar encounters e.g. in search results, as advertisements, in blogs, news posting, company websites, mobile data, etc.
Retail Environment: Physical stores with “stores as a brand” (Woolworth, Walmart, Galleries Lafayette, Auchan) or “branded stores” (Levi’s, Apple, Zara, H&M, Vero Moda). The meeting point between consumers and CPG’s. The packaging design in this environment has to attract attention and persuade consumers to purchase the product.
Engaged Home Environment: An environment, where the product is consumed or utilized by the end consumer, once it is purchased. Usually visual awareness is less significant in this environment, thus packaging design has to reflect upon convenience in handling the product and facilitating consumption.
Smart Packaging: Incorporates advanced technologies to enhance the primary function of packaging or adds new functionalities.
Smart Interactive Packaging: Creates a two-way communication between the user and the package by using design-based or/and technology-based systems in order to enhance consumer experience and engagement or/and functionality of the product.
Consumer Interaction: Enhances consumer experience to create emotional, sensory, and physical connections by engaging and entertaining the consumer through interactive packaging solutions.