In E-commerce, a Packaging Paradox

To continue its incredible upswing, e-commerce applications must downsize to deliver a key customer demand: sustainability. © Nico Vincentini – stockadobe.com.

Packaging Materials are Evolving to Meet New Consumer Demands

By David Goodrich, President of HexcelPack

The e-commerce industry is undoubtedly booming. Retail e-commerce sales in 2022 were estimated to exceed $5.7 trillion worldwide, according to Statista. Experts predict this figure will grow by 56% over the next several years, reaching nearly $8.1 trillion by 2026.

With the global e-commerce market continuing to expand, packaging has become a critical component of the online shopping experience. Packaging trends are evolving to meet the demands of both environmentally-conscious consumers and cost-conscious businesses. Since packaging plays a pivotal role in how customers perceive the value and quality of products, staying ahead of the curve is crucial for any online retailer’s success. After all, with more growth comes increased competition.

One way to do this is by using e-commerce packaging that appeals to your audience. Utilizing sustainable, plastic-alternative shipping materials, embracing packaging automation for faster processing, and striving for minimalist, right-sized packaging are all crucial steps toward more eco-friendly, efficient, and customer-centric packaging practices that enhance overall consumer experience.

As an added bonus, companies that adopt these trends are not only contributing to a healthier planet, but also improving their bottom lines.

Paper vs. plastic

With increased awareness about the impact of packaging waste on the environment, especially plastic, many consumers are taking a stand for sustainability. A recent report  by Shorr found that 86% of consumers are more likely to purchase a product from a brand or retailer if the packaging is considered sustainable. According to the same report, 77% of consumers expect more brands and retailers to offer 100% sustainable packaging for their products in the near future. This movement, which has gained even greater momentum in the last year, has put a much-needed spotlight on diminishing or eliminating many plastics from packaging materials.

In e-commerce, where packaging waste is substantial, the move towards plastic-free packaging is both a moral and market-driven one. Many e-commerce companies are transitioning to sustainable packaging materials, such as paper-based packaging products like recycled cardboard or biodegradable plastics. These materials provide a more environmentally friendly option without compromising on functionality and protection.

Paper-based packaging products offer drastically improved sustainability, with little to no impact on the environment. Furthermore, they deliver product protection proven to outperform plastic alternatives. Unlike single-use plastic bubble packaging, paper is fully curbside recyclable. Conversely, plastic pollution is growing: twice as much plastic waste being produced than two decades ago, and just 9% of the 460 million tons of plastic waste produced annually was successfully recycled, according to an Organization for Economic Co-operation and Development (OECD) report. The bulk of the waste ends up in landfills, incinerated or leaking into the environment – especially our oceans.

Making e-commerce product protective packing from the same materials as the boxes in which they arrive – namely, paper – is the simplest, most streamlined path to a dramatic rise in eco-friendliness. This is an obvious solution for any business looking to do its part to fight the mounting waste crisis – and in doing so, reap the benefits of a consumer base increasingly considering a brand’s eco-consciousness when making purchasing decisions, online or otherwise.

Minimalist packaging and box size reduction

In the competitive world of e-commerce, embracing minimalist packaging and box size reduction is a win-win strategy. This trend, which involves streamlining and simplifying packaging design, while also choosing the most appropriately sized box for each order, not only aligns with the global sustainability movement but also offers substantial cost savings, improves the customer experience, and enhances a brand’s image.

In the past, many products have been shipped in oversized boxes filled with excessive void fill materials, resulting in higher shipping costs and greater environmental impact. By using fewer materials, which typically require fewer resources – cardboard, inks, adhesives etc. – brands can reduce packaging costs while minimizing waste.

In addition, shipping costs continue to rise, and many shipping carriers now factor in a package’s dimensions to determine pricing, as opposed to conventional weight-based pricing. Using right-sized boxes allows for reduced weight and space requirements when shipping, which can optimize shipping costs and significantly bolster a brand’s bottom line. Likewise, a reduction in box size reduces the warehouse footprint needed for packing areas and allows for increased storage capacity of saleable product.

E-commerce brands that make the transition to minimalist packaging and reduced box sizes are not only contributing to a healthier planet and improving their bottom line, but also improving their image by earning brand loyalty from today’s growing number of environmentally conscious consumers.

Packaging automation

Inherent to e-commerce’s exponential growth is the overall volume of products shipped. In 2022, global parcel shipping volume amounted to over 161 billion parcels, according to Statista. This volume is expected to reach 256 billion annual parcels shipped in 2027, a compound annual growth rate (CAGR) of 59%. To keep up with this growing demand, packaging automation has become an increasingly vital trend for e-commerce companies, who face ever-escalating pressure to make shipping processes more efficient and customer-centric.

Aside from the e-commerce industry’s explosive growth, business challenges over the past few years including labor shortages, supply chain issues and inflation have only strengthened the push toward packaging automation and its numerous benefits.

For one, automated packaging processes are significantly faster than manual ones. This means quicker order fulfillment and faster shipping. Trending now is automation equipment that sets up the correctly sized box and delivers it to the packer. The packer then loads the purchased items, fills the box with the void fill packaging, immediately conveys it to the automated box closure and labeling system and then off goes the package to sorting and the outgoing shipment trailer.

In addition, automated packaging equipment allows for less dependence on manual labor, which not only decreases labor costs, but also positively impacts customer satisfaction by minimizing shipping errors. This means fewer shipping mistakes and potential returns, enhancing the overall customer experience.

Trends may come and go, but in a rapidly growing industry like e-commerce where customers increasingly demand fast order processing and eco-minded values from retailers, these trends are likely here to stay and it’s wise not to be left behind.

About the Author

David Goodrich is President of HexcelPack, a developer of eco-friendly, paper-based protective cushioning solutions to replace bubble wrap and other plastic or foam-based materials. The company’s internationally-patented HexcelPack™ portfolio provides sustainable, superior product protection for retail packages, corrugated shippers, envelopes and other containers. Learn more at www.hexcelpack.com.