Page 14 - Packaging News Magazine Nov-Dec2020

14 INDUSTRY INSIGHT | E-COMMERCE
www.packagingnews.com.au | November–December 2020
Lockdown changed the way Australians shop – maybe forever. What was previously a steady stream of e-commerce turned into a raging torrent. And it might keep running. What’s the flow-on effect for the packaging industry? Tim Grey reports.
Covid-19’s silver lining
THE coronavirus pandemic has fundamen- tally reshaped the economy. Everyone is aware of the sweeping unemployment the virus has caused. While the official unemployment rate sits at 6.9 per cent, the ABC reckons the rate is closer to 10 per cent, with at least 1.5 million Australians
having lost their jobs.
But there are a few sparkles of gold-dust
at the bottom of this hole. As is often the case, widespread destruction carries with it the seeds of new growth. For instance, while internet shopping had been steadily taking hold, the closure of retail forced almost the entire population online.
ALREADY ON THE UP
Before March 2020, online retail spending was already hot, kicking upwards at a rate of 24.4 per cent per year. By comparison, the retail sector as a whole grew a measly three per cent. A report by Australia Post found that online sales made up around 10 per cent of Australian’s total spend. It also found that more than 73 per cent of Australian house- holds shopped online in 2018, and number of purchases made online were up 20.2 per cent.
And businesses were getting pretty savvy with tailoring their online experience to meet a customer’s needs. According to Australia Post, it’s becoming increasingly important to connect the physical and digital shopping experience to create a seamless environment for the consumer. Some retailers are provid- ing consumers with a more holistic approach when purchasing their products.
“Retailers are also increasingly looking for ways to stand out from their competi- tors,” Ben Franzi, general manager, parcel and express services at Australia Post said.
“Speed of service is being used as a com- petitive marketing tool to convert more sales and retain loyalty. As more retailers provide faster fulfilment and delivery, shoppers’ expectations will continue to grow. As the e-commerce landscape is constantly evolv- ing, retailers must adopt new ways to grow their market share.”
What was already a powerful increase in market share got supercharged by the pan- demic, with small to medium businesses establishing e-commerce platforms to jostle with the big dogs. And the packaging indus- try had to rapidly up its own game in order to meet demand.
THE PACKAGING STORY
Amcor, for example, opened a pair of new labs to test and certify packaging for e-com- merce. With global e-commerce sales fore- cast to triple between 2014 and 2021, the new Amcor facilities in Ghent, Belgium, and Manchester, Michigan will employ indus- try-leading experts to improve packaging for global customers, Virginie Maes, vice presi- dent of e-commerce and business develop- ment at Amcor, said.
“With these new labs, Amcor is ready to help customers harness significant online sales growth; particularly in pet food, sauces, beauty and personal care, and home cleaning products,” she said.
According to Maes, brands trading online need to balance durability of packaging with attractiveness, convenience, and sustainability.
“Distributors often try to reduce the risk of product damage by adding cushioning, over-wrapping and packing materials inside the shipping box. Consumers are pushing back against this excess packaging and waste, so the best option is to make sure primary packaging is designed differently to protect products better,” she said.
Meanwhile, other local companies have been looking for ways to improve the envi- ronmental impact of online shopping. E-commerce industry reports show that 48 per cent of consumers want recyclable pack- aging. So, New Zealand home compostable packaging supplier to the global e-commerce market, The Better Packaging Co are giving it to them, partnering with SEKO Logistics to help significantly replace single-use plastics in global e-commerce fulfillment supply chains.
Through the deal, SEKO plans to use com- POST pack courier satchels and comPOLY gar- ment bags within its own e-commerce fulfill- ment operations. SEKO customers performing their own packing will also qualify for price discounts when they choose to source and/or custom brand Better Packaging products.
Speaking to Lindy Hughson at PKN, co- founder and director of Better Packaging, Kate Bezar said: “The Better Packaging Co feels a great sense of urgency to replace single-use plastics with more sustainable alternatives