Canadian Vending

Features Innovation Trends
Packaging innovation: link to the vending experience

May 25, 2017
By Michelle Brisebois

Last year, KitKat chocolate bars in Japan were offered in a mail-friendly package that converts to a smartphone holder with space for a personal message in response to the Japanese tradition of giving a pack of KitKat chocolate to students for luck on exams. Photo courtesy Nestle Japan

Steve Jobs once said, “Packaging can be theatre, it can create a story.” Anyone who’s purchased an Apple device knows that the products are presented in the most premium way. There’s a sense of gravitas to the first opening of the box. While Jobs is correct in noting packaging’s role in the brand experience, it’s also expected to serve functional requirements. Protector, marketer, salesman, environmental steward and,increasingly, digital beacon: the humble package will play a key role in all retail channels going forward.

Mintel explored five key packaging trends in its look ahead to 2017, so we wanted to examine those trends as they relate to vending and micro markets.

The [re]union of package structure and branding
Mintel notes that one-third of U.S. adults say they perceive a food product housed in high-quality packaging to be of quality as well. A solid construction protects the product and communicates freshness. Mintel also reports that “21 per cent of Canadian consumers are interested in re-sealable or re-closeable packaging in order to reduce waste.”

Although clean label messaging continues to trend around the world, there is some confusion as to exactly what the term “clean label” means. According to Canadean’s Q4 2015 global survey, 34 per cent of consumers not understanding its meaning, Canadean also found that of those respondents who do recognize the term “clean label,” most consumers think it means the product is free of pesticides, chemicals or artificial ingredients, or is organic. Some believe it means the product is allergen-free. Social media hashtags such as #cleaneating are promoting the trend. Examples of the structure and branding synergy can be found in the various yogurt products aimed at children.  Formats include: drinkables and delivery by squeezing a tube like toothpaste and the result is a fun but nutritious product that’s easy for parents to feed kids while on the go or to pack in a lunch. Branding is bright, exciting, interactive, and easy to hold, and packaging is often shaped
like animals.


The face and role of packaging online
The grocery industry is keen to grow its online share, and increasingly, vending channels and micro markets are leveraging digital tools to allow consumers to view inventory and order from afar. As e-commerce continues to develop, packaging must pop – both on the shelf and on the screen – to appeal to consumers. Many companies are enlarging their brand presence on packages and removing visual clutter as they understand that often the product is viewed on mobile devices as a thumbnail image. Other companies such as Nutpods dairy-free creamers have designed the package to have a large image of the creamer being poured into coffee so the consumer can see easily online what it does. The structural integrity of the package is shatter-proof, resistant to fluctuating temperatures and compact for ease of shipping.

Packaging gets smart, active and intelligent
The Internet of Things will see our homes, cars and consumer packaged goods all connected to the Internet. The first wave of packaging seems to use this technology to communicate product origin stories. According to Mintel, “50 per cent of U.S. consumers are interested in scanning food packaging to learn more about the provenance of fresh produce.” Electronics company Insignia has developed a label containing a dot that changes colour with time to communicate product freshness. Best-before dates – often so hard to read – are no longer required. Xerox has created a thin-film rewritable label with 36 bits of non-volatile memory. This technology prevents counterfeiting, which is a concern for highly regulated products such as drugs and beverage alcohol. Smart labels can store a lot more information than traditional bar codes can. QR codes allow consumers to connect to instruction manuals, video content and data sheets. The individual product’s supply chain experience, including storage, transportation, handling and inventory, can be tracked. As vending moves increasingly from products with longer shelf lives and more additives to an offering more skewed to perishable foods, smart tags will help both operators and consumers track freshness.

The experience of packaging
This trend speaks to the ways in which packaging can entertain, engage and give the consumer an experience that enhances their enjoyment of the product. Mintel cites globalization and production efficiencies as factors contributing to a sea of of mediocre packaging overloaded with information. Smart brands are decluttering their labels and some are effectively tapping into the consumer hunger for brand co-creation and personalization. Coca-Cola’s European limited edition label with a roll-fed feature that creates a bow is intended to reinforce their brand values of happiness and sharing. KitKat chocolate bars in Japan were offered in a mail-friendly package with space for a personal message. This option was offered in response to the Japanese tradition of giving a pack of KitKat chocolate to students for luck on exams.

Extend my brand
While price is an important consideration for consumers’ purchasing decisions, strong brand equity and trust can allow a brand to extend its reach into new channels of distribution. Kraft Snack Trios leverages Kraft’s established brand equity to tap into the growing healthy snack market. The chambered package contains dried fruits and granola along with the cheese curds for an indulgent energy kick. In a more dramatic departure from its core business, Carlsberg has launched a line of male grooming products containing the beer’s main ingredients. Originally designed to be a limited edition release, the line was expanded due to its success. The packaging ties directly in to the beer brand and taps in to the growing movement around male beauty products. This trend is driving the estimated $579 million of growth in the Canadian men’s beauty product market by almost 70 per cent between 2003 and 2008, according to Euromonitor.

The vending industry’s trajectory is now solidly linked to that of emerging technology.  Self-serve delivery has been completely reinvented and it’s incredibly exciting for operators. When you consider what products to offer your customers, think about their paths to purchase, consumer trends and then build in a bit of fun. If you choose well, packaging can function as the sales associate that never leaves the store.