Pack to the future: Connective packaging technologies set for landmark year

06 Mar 2019 --- Near-Field Communication (NFC) and other connective packaging technologies are readying for full-scale deployments across multiple markets in 2019, industry experts are predicting. The increased cost-effectiveness and standardization of connective mechanisms, notably NFC tags, means that brand owners are now able to integrate connective technologies in packaging onto existing production lines.

Some experts, such as Maciej Kiryllo, New Business Director of IoT smart packaging innovators Talkin' Things, expect the first full-scale deployments to originate in the pharmaceutical industry. This will be followed by wide-scale rollouts from FMCGs.

“NFC will really expand a lot [this year]. Pharmaceutical companies will be the first on the market with NFC. They have a real need for customer engagement but also for brand protection – mainly to ensure the product has never been opened before – and NFC can provide this,” Kiryllo tells PackagingInsights.

“Not only can they track and trace the product, but they will also then have all this post-purchase communication with patients. After pharmaceuticals, I think that FMCG brands will follow with wide-scale rollouts of NFC,” he says.

Talkin’ Things is currently working with pharmaceutical companies and it says that it will soon be able to talk publicly about large-scale NFC implementation. The start-up is famed for its Black Red Ale beer label, which incorporates a large “talking” skull Augmented Reality (AR) facial recognition mechanism on the bottle to communicate with consumers based on their emotions.

Mainstreaming: Breaking down the barriers
Cameron Worth, Founder of IoT agency SharpEnd, agrees that connective packaging technologies – particularly NFC – will experience full-scale deployments this year after a period of restricted brand trials.

Maciej Kiryllo, New Business Director of Talkin' Things, speaking to PackagingInsights during Packaging Innovations 2019.“The big difference between this year and last year with NFC is that the technology is starting to be applied in standardized ways. You now have companies like Guala Closures, for example, who are producing what they call the ‘e-WAK,’ which is an NFC-enabled wine closure. It offers a clear proposition to brands which says: There will be no change to your production lines but this is now NFC-enabled. They have removed all those barriers to entry,” he explains to PackagingInsights.

Worth notes that SharpEnd is experiencing more and more brands coming on to the connective network and wanting to kick off pilot programs. But he believes this year will see the start of first real mass-scale deployments, breaking past the half-million barrier, going across different markets.

“Three months ago you could only get NFC tags for around US$0.12 but now they can be purchased for half that. Cost reduction was one of the things holding back NFC. It’s also becoming easier to sell the idea of connective packaging to brand owners as the brand stakeholders start to shift their perceptions in favor of these technologies,” Worth says.

“The last barrier is around consumer attitude. Consumers are becoming more comfortable with technologies like Apple Pay – I think there has been a 100 percent year-on-year increase in the UK – so that will obviously help to drive better engagements in connective technologies,” he adds.

Recently, Danone’s Spanish natural mineral water brand Font Vella introduced a cap device that tracks water intake and instructs people toward adequate hydration. Coach20 is being developed in partnership with smart packaging start-up water.io.

Engaging consumers, protecting brands
After successful brand trials like SharpEnd’s collaboration with Malibu on the “Coco-nect” cup project – in which the customer twists the cup to request a refill during events – the huge potential of connective packaging technologies to engage consumers and protect brands is increasingly apparent.

“At Talkin’ Things, we are helping the products become the media platform,” continues Kiryllo. “Before, brands were communicating with customers on a limited level – but now we see the best way to engage consumers is through technologies like AR.”Talkin' Things' Talkin' label in action.

“Imagine you can purchase a soda as a consumer and collect loyalty points every time you purchase that product. This is the first time retailers can do this without retailer involvement,” he ponders.

More importantly, Talkin’ Things is using NFC technology to enable ‘open detection’ and a proof of purchase. “With this technology, we can organize brand loyalty programs independently from the retailer,” Kiryllo notes.

Through this big data accumulation, brands can better understand consumer behavior, especially in the “post-purchase channel” which was previously restricted, and tailor business and marketing strategies with more precision.

The sustainability challenge
Worth concedes that the popularization of connective packaging technologies like NFC is sometimes restricted by the dominant driver in NPD: sustainability. However, he does note that, while printed technologies will have no effect on the recyclability of products, companies are also innovating to increase the sustainability of plastics-based NFC.

“NFC will have a negative effect – that is the unfortunate answer. Still what I am starting to see from companies like PragmatIC – which works on the commercialization of plastics-based NFC – is less impact on the sustainability of products,” Worth says.

“Overall, I think the focus of brands on sustainability doesn’t help the popularization of NFC right now, but there are companies that are actively addressing that.”

Unexplored opportunities
The two major benefits of connective packaging technologies are enhanced consumer engagement and brand protection. NFC is able to provide both of these benefits simultaneously.

Cameron Worth, Founder of IoT agency SharpEnd.“At the moment, companies are using different technologies to solve different problems. I believe that NFC is the ultimate technology because it can both enhance customer experience, provide brand protection and facilitate track and trace,” Kiryllo says.

Worth agrees that of the various connective packaging technologies, NFC has the brightest future. SharpEnd is the appointed IoT agency of Pernod Ricard, charged with driving its connective NFC bottle program forward across its brands.

“When you are able to look at connective packaging technologies at an HQ-level, rather than just an individual brand, you start to benefit from economies of scale and larger conversations about partnerships,” Worth says.

“We are trying to move the conversation away from brands and move it into a group level discussion, because obviously the cheaper the technology the more accessible it is for multiple brands,” he adds.

Beyond mobile technology, Worth believes that there are numerous unexplored avenues in the NFC and connective packaging technology space at large. He highlights a recent SharpEnd point-of-sale installation in Copenhagen, which essentially uses the product as a type of remote control.

“Right now, people only think about mobile phones, but there are actually many more creative possibilities beyond that,” Worth concludes.

By Joshua Poole