How smart packaging can create value

The role of packaging has substantially evolved from simply protecting products to driving sales. Smart packaging continues this trend towards greater functionality, employing sensors, printed electronics and wireless communication to add value in novel ways.

With various applications, IDTechEx’s latest report finds the market for smart packaging electronics will be worth around US$2.6 billion by 2033. But where can it best create value?

Parcel tracking labels

Smart packaging can enable tracking at a crate or even item level, rather than a pallet level. Technologies such as printed/flexible batteries and sensors enable this, allowing logistics companies or even insurers to track when/where individual items are being lost, stolen or mistreated.

Logistics labelling can also benefit ‘click-and-collect’ businesses in which stores serve the same order fulfilment role as distribution centres. Real-time item-level tracking, enabled by smart packaging, can improve the accuracy of complex inventory management systems to enable different parts of the value chain to take on the fulfilment role.

Material identification for recycling

Only approximately 10% of all waste is recycled, largely due to difficulties in sorting materials with extremely similar properties or determining the extent of the contamination.

The European Union is exploring technology solutions based on smart packaging that could address this in a project called HolyGrail 2.0. A ‘digital watermark’ embedded into the regular packaging design will enable cameras to identify the product and its recycling requirements. Unlike a barcode, this will cover the entire object, so it cannot be obscured or damaged. If mandated, this would allow recyclers to easily sort through waste without needing to rely entirely on the properties of waste materials.

Consumer engagement

The pandemic has caused a global surge in the adoption of ID technologies, particularly QR codes. This has resulted in an increased focus on ‘connected experience’, with brands interacting with consumers on landing sites accessed via smartphone scans of NFC antennas or QR codes. For companies, this is a useful tool for collecting data and in marketing campaigns.

Digitalisation of the resale markets is an emerging example of a connected experience. By facilitating an authentication process, smart packaging helps brand owners establish their own marketplaces and maintain control over brand equity after the initial point of sale.

Image credit: iStock.com/onurdongel