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Smart Packaging will Transform the Fast Growing Online Grocery Space: Tetra Pak Index 2018

Jul 26, 2018   17:48 IST 
New Delhi, Delhi, India

Smart packaging technologies based on unique digital codes will take both online and off-line grocery in exciting new directions over the next few years, says the Tetra Pak Index 2018, launched today.

Online grocery shopping is growing at a double-digit rate, including in India, while traditional stores are being reinvented, merging together into an omnichannel where consumers expect to be able to buy whenever, wherever and however they choose, with the smartphone as their compass. Packaging will play an important role in response to the trends that are shaping the growth of on-line grocery, says the company.

Tetra Pak India & BigBasket

UHT milk has been selling well on online platforms in India, especially in metropolitan areas, driven particularly by convenience and food safety factors. As part of its strategy to convert consumers in India to UHT milk from other formats, Tetra Pak partnered with BigBasket, the country’s #1 online grocery platform with around 0.5m consumers ordering every month across more than 25 cities.

The joint campaign targeted 100,000 non-buyers of UHT milk in New Delhi, Mumbai and Bangalore, with banner advertising on the BigBasket portal and mobile app offering free samples of Amul Tazaa and Nandini branded milk in Tetra Pak® packages. Tetra Pak sponsored the cost of the initiative, while BigBasket managed the logistics, delivery and data analytics.

BigBasket tracked six to eight weeks of purchase data to check the uptake in UHT purchases and increase in average business. The result? More than 15,000 new UHT milk buyers after the promotion period.

Four trends shaping the growth of on-line grocery
The Tetra Pak Index 2018 highlights the four key trends shaping the growth of on-line grocery:
Convenience: The main driver for on-line consumer take-up, as time-crunched consumers look for new ways to make their life easier. Key opportunities include easy product replenishment, voice, and convenient packaging

Personalisation & uniqueness: Customisation of products and personalisation in the consumer journey will be important differentiators going forward. This is accelerating the direct-to-consumer trend and as many as 80% of consumer-packaged goods companies are predicted to migrate to this model by 2025

Technology & performance: Super-fast delivery in as little as 10 minutes is expected by 2025, changing consumer behaviour to buy more frequently and in smaller amounts, adding more complexity to the logistics. Supply chains will continue to be transformed by a raft of technologies, notably radio-frequency identification (RFID) and robotics, boosting efficiency and transparency

Sustainability: Pressure on plastic and awareness of the circular economy will continue to grow, and recycling will become ever more important. Consumers want to know whether brands are ‘doing the right thing

Saumya Tyagi, Director Marketing, South Asia Markets, Tetra Pak, says: Globally, the growth in online grocery channel is driven by increased convenience, opportunity for personalisation, faster last mile delivery, enhanced value offering to the consumers and sustainability. In India as well, online food and grocery is expected to grow at a CAGR of approx 70% to reach USD 5bn by 2020. ‘Smart’ packaging can play an important role in accelerating this growth, by offering significant advantages in consumer engagement solutions as well as traceability for our food and beverage customers.

The role of smart packaging 
Smart packaging technologies based on unique digital codes allow each and every product package to be given a unique identifier. These codes can be read by either data scanning devices or an ordinary smartphone, linking to vast amount of information and opening up all kinds of possibilities.

It creates an interactive channel with individual consumers, allowing brands to have a real time conversation with the consumer, sharing details on the sourcing of raw materials, nutritional facts, as well as games, promotions and environmental information.

At the same time, with insights captured through these digital codes, brands can continuously improve the shopping experience and make it ever more personalised for the consumer.

e-Retailers are also calling for unique identifiers compatible with the robotic technology used in their warehouse and distribution, as this is widely seen as the key to success in e-commerce. Data and full traceability helps them navigate complex logistics and improve efficiency, moving closer to real-time order fulfilment.

Tetra Pak Index 2018 is based on consumer research conducted select countries, a global market segmentation study, as well as interviews with e-retailers. 
Download the free Tetra Pak Index report here.

About Tetra Pak
Tetra Pak is the world's leading food processing and packaging solutions company. Working closely with our customers and suppliers, we provide safe, innovative and environmentally sound products that each day meet the needs of hundreds of millions of people in more than 160 countries. With over 24,000 employees around the world, we believe in responsible industry leadership and a sustainable approach to business. Our motto, “PROTECTS WHAT’S GOOD™," reflects our vision to make food safe and available, everywhere.

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Notes to Editor

  • The Tetra Pak Index, currently in its 11th iteration, is an annual report focused on providing insights into the global trends and opportunities shaping the future of the F&B industry. With online being the fastest growing channel for groceries today, this year’s report focuses on how  brands can leverage the rise in e-groceries to improve efficencies, strengthen consumer relationships and, ultimately, grow their business.

  • Looking to 2030, China will continue to lead the way in disruptive innovation – both online and in “new retail” offline – due to heavy investment and consumer enthusiasm, plus it has no entrenched traditional modern trade to defend. Other pioneering hotspots in the developing world include Bangkok, Jakarta and Seoul. Notable resistors, where an abundance of physical stores and associated buying experience will continue to drag digital trade, include India, Brazil and Russia.

  • In the developed world, rising consumer confidence in online delivery and quality are expected to drive rapid online trade growth in France, Belgium and the UK. Relative laggards include the US, Germany and Japan, where rising emphasis on quality and innovation are expected to keep modern trade competitive.

  • Robot picking through visual recognition aided by smart packaging, enables e-retailers to handle four times more orders than when processed manually, and move closer to real-time order fulfilment.

  • E-retailer private labels are well accepted by consumers and search for grocery products is done more by category, rather than by brand, which may well also be the case as voice ordering becomes more mainstream.

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