Retailers' need for full-fledged omni-channel marketing strategies blew up in 2020, with consumers' intensified reliance on e-commerce for essential and non-essential products. Millions of consumers already familiar and comfortable with online shopping increased their use, while many new users tried it for the first time to work around pandemic-related restrictions.
Fortunately, most retailers had been building up e-commerce offerings long before COVID-19 hit. Still 2020 demanded rapid acceleration in the buildup and deployment of new delivery models and packaging solutions that were up to the challenge.
This convergence of changes in both retailer and consumer behavior, coupled with pandemic restrictions, was quickly illustrated in corrugated cardboard box demand.
In March 2020, corrugated shipments grew 9% over March 2019 shipments, boosted by overstocking of household paper, cleaning supplies and food. Shipments grew again year-over-year in June, July, and September, with October, November and December shipments hitting record highs and boosting industry shipments up 3.4% in 2020, the largest annual increase since 1994. The corrugated industry ended the year at 407 billion square feet (BSF) of product shipped, its highest level of shipments recorded, surpassing the previous high of 405 BSF in 1999.
Simply put, corrugated cardboard boxes were recognized as the backbone of the American supply chain and the fast-tracked shift to e-commerce has kept the industry on its toes, working with brand owners and consumer packaged goods (CPG) customers to adjust box sizes, enhance the consumer's in-home experience with high-quality graphics, and communicate brand values.
Today, products are shipped in smaller units, to far more end destinations. Protecting those products along the way, throughout the supply chain, is different than bulk delivery to retailers.
That means the packaging is different. Instead of shipping a pallet of products to a store, sellers are shipping single units to many more destinations. Those packages end up in people's homes, instead of in stores. There, the consumer's experience will shape their perception of the brand.
Direct delivery to consumers opens a golden opportunity for brands to shine. The product must first arrive in perfect condition – adequately protected through shipping and delivery, looking good, in a container that has withstood its journey to their homes.
To really score points, the package can become a branding vehicle used to delight shoppers. Corrugated printing technologies have advanced in the past few years to make high-quality graphics better than ever – so the box can be used to deliver a powerful brand message. It's an opportunity to brighten someone's day by showing up looking beautiful and speaking directly to them.
The package can also be used to communicate brand values, in addition to merchandising. Consumers care more than ever about sustainability. They do not want to receive items over-packaged, so right-sizing the box is important. The fewer packing materials needed to fully protect the product inside the box, the better. The less waste generated in a consumer's household, the more positively they will feel about the package and the brand.
Corrugated boxes are recycled more than any other packaging material (over 90% for the past decade) and are used to make new boxes that are needed to keep the supply chain running. On average, boxes contain 50% recycled content. The majority of corrugated boxes historically recovered for recycling have come from retailers, where they are baled and sold to recycling companies. With the increase in e-commerce, the corrugated industry needs to capture more of the boxes that are going directly to consumers in order to continue recycling as much as possible and make up for the volume no longer going through traditional retail locations.
Most consumers have access to corrugated recycling programs in their communities and consumers should be regularly encouraged to recycle the boxes. Community education is key, but CPGs can do their part by making sure their packaging is recyclable and their consumers know it.
Brands that successfully adapt to continue selling and delivering positive experiences, through whatever channels consumers prefer, have an opportunity to pull ahead and gain loyal customers for the long haul.