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Economic concerns battle convenience for supremacy

Escalating oil costs have an impact on both packagers and consumers, driving new food and beverage packaging trends. But convenience is still top-of-mind for many.
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FILED IN:  Sustainability  > Strategy
     

Food and beverage products and packaging are inextricably linked to the trends taking place within the larger economy, society, and consumer culture. In the past 12 months, rising oil prices have forced consumer packaged goods companies to re-evaluate packaging formats and materials, as well as their transportation and distribution methods. At the same time, consumers, hit hard at the pump and watching their wallets, are turning more and more to packaged food and beverage solutions that provide healthful, convenient, at-home alternatives to dining out.

And, as consumers grow more concerned about energy consumption and the environment as a whole, they are increasingly demanding more eco-friendly and socially conscious products and packaging. Research from the Mintel (www.mintel.com) Global New Products Database puts it this way: “More than ever, shoppers want to purchase goods that help protect and preserve the world around them. Manufacturers have responded with everything from recyclable packaging to products that maintain the body’s health to entire brands that support environmental causes.”

Nonetheless, convenience still reigns supreme in many categories, with consumers continuing to place great value on products that offer such ease-of-use traits as portability, resealability, and simple preparation and consumption. Driving this desire for convenience is the consumer’s busy, on-the-go lifestyle, as well as changing demographics. “Greater numbers of single-person households and older consumers are supporting the demand for more convenient prepared foods and single-serving portions,” notes “Rigid Food Packaging,” a study from BCC Research (www.bccresearch.com).

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Following are some examples of how CPG companies are addressing these trends through new food and beverage products and packaging.

Holiday season gets greener with 100% recycled materials

Global spirits, wine, and beer producer Diageo, U.K., is moving its portfolio of premium brands closer to sustainability this holiday season with the launch of 100% recyclable materials for its U.S. Value Added Packaging (VAP) gift packs. Diageo’s VAP programs involve pairing the company’s popular brands—among them Crown Royal, Ciroc, Jose Cuervo, VO, and Captain Morgan—with gift elements in elegant, eye-catching holiday packs.

“Diageo is committed to finding ways to reduce energy usage and related greenhouse gases, improve water-use efficiencies, and reduce or eliminate the amount of waste sent to landfills,” says Diageo Brand Technical Center senior vice president Dave Wengerhoff. “The gift elements used in the VAP program, such as glassware, typically require more and/or reinforced packaging to keep the gift secure. Our recyclable VAP program allows us to provide consumers with a great gift item while empowering and educating them to recycle packaging components that would otherwise find their way into a landfill.”

The new gift-pack cartons eliminate the use of metallized polyester-laminated board and use recycled PET rather than polyvinyl chloride for display windows. Each carton includes one of three custom graphics, placed near the product’s UPC code, that lets consumers know that packaging components, including inserts or trays, are completely recyclable. For example, the graphic used for packs with a window on multiple panels and with one or more internal trays reads: “This package is 100% recyclable. All pieces are marked for proper recovery, and window detaches from frame.”

The change in packaging materials, Wengerhoff relates, is in part a response to the consumer’s greater desire for more sustainable products. “Consumer awareness of environmental issues has increased significantly,” he says, “and as a result, people are increasing their demand for more environmentally friendly products.”

He adds that no compromises in packaging quality were required when greening the gift packs. “The recyclable materials produced today look as good, if not better, than the materials previously used,” he comments. “In the last two years, we have made great progress in this area, and 100% recyclability of VAP packaging components has become our new standard.” As of presstime, the Diageo holiday gift packs were just hitting retail shelves.

Mini bottles fuel energy rush

PET is still the dominant resin for food and beverage packaging, with high-density polyethylene having the second-largest share. A study from The Freedonia Group (www.freedoniagroup.com) called “Plastic Containers” notes that “U.S. demand for plastic containers will advance 5.4% annually through 2012 to nearly $32 billion, creating demand for 15.7 billion pounds of resin.”

While Freedonia predicts that growth in resin volume will be restrained by light-weighting and down-gauging efforts aimed at reducing resin consumption, it also notes that “unit expansion will outpace volume increases as a result of consumer preferences for smaller, single-serving containers.”

One interesting phenomena to note in the area of single-serve “beverages” is the advent of the energy shot—a product that addresses the consumer’s hectic lifestyle and need for supplemental energy. Packaged in miniature bottles (most often made of PET), these liquid products typically provide 2 oz of concentrated energy beverage and include such ingredients as caffeine, taurine, and guarana. As of October, A.C. Nielsen Monitor Plus (www.nielsenmedia.com) noted the availability of 28 different energy-shot brands.

Not new, but notable for its 76% to 77% share of the market, according to Nielsen, is 5-Hour Energy® from Novi, MI-based Living Essentials. One of the first in the category, 5-Hour Energy was launched in late 2004 for $2.99 per bottle and employs packaging with a high-end appearance that has set the example for competing products. Recalls Living Essentials creative director Carl Sperber, “We were trying to achieve the look of a premium energy product. The price point was really a strategy for us. The product works so well, we wanted people to understand that it is worth the money.”

Primary packaging is a 2-oz Boston round-style PET bottle (from a proprietary supplier) that Sperber says was chosen for its convenient, portable size and its marketability. “The bottle gave us a shape that was not only appealing, but it also provided enough billboard space to tell the story of the product,” he says.

A bold, eye-catching color palette decorates a full-body shrink-sleeve label, which is gravure-printed by an unnamed supplier. Shrink sleeves, as well as gravure technology, were selected for their ability to create a premium appearance, Sperber relates. The label’s graphics show a black silhouette of a figure running up a mountain, “an experience that everyone can aspire to,” Sperber says, against a background of vivid red, yellow, and blue streaks.

Apparently, the selections of product ingredients, packaging components, and price point hit their mark: Sperber reports that 5-Hour Energy will achieve sales of $200 million in 2008.

Among the newer energy-shot products on the market making a run at Living Essential’s share are 2.5-oz Rockstar Energy Shot from Rockstar, Inc., and 2-oz Jolt Endurance Shot from Wet Planet Beverages—both found at a Chicagoland Walgreen’s for $4.99 per two-pack—and Amp™ Energy Shot from Pepsico, Inc., found at a Chicagoland Target store for $2.99 for a 2-oz bottle.

Package becomes part of convenient lunch product

The epitome of convenient, single-serve food in plastic packaging is a newly launched line of shelf-stable, microwavable Healthy Choice meals from ConAgra Foods of Omaha, NE. Promoted as a healthful, portable lunch option for busy deskbound employees, the Fresh Mixers™ line uses several interlocking plastic packaging components that enable quick and handy meal preparation and consumption. Each of the six varieties includes rice or pasta along with a separately packaged serving of sauce and meat.

“With the growing trend of office workers working harder and increasingly eating at their desks, people are getting into a lunch rut of eating the same food every week because of the lack of convenient and healthy lunch options,” ConAgra director of Product PR Regina DeMars tells Packaging World. “Strapped for time and cash, many working Americans are compromising on the nutrition and quality of their lunches.”

While DeMars declined to provide specifics on the packaging materials and technology used for the shelf-stable meals, some information can be deduced by examining the package. Similar to Healthy Choice’s Café Steamer frozen, microwavable entrées introduced earlier this year, the Fresh Mixers line uses the company’s Steam Cooker™ technology to circulate steam throughout the primary package during cooking. The package consists of a squat, oblong bowl made of clear polypropylene that holds the uncooked rice or pasta. A second PP tray of the same width rests on the flanges of the primary package and holds the sauce and meat mixture. Presumably this component is retorted to allow for shelf stability.

Topping the sauce tray is a heavy film lidstock that has a peel-back, pressure-sensitive tab placed in its center. Both the bowl and tray are covered with a green, snap-fit PP lid dotted with holes for microwave steaming. Covering the top of the lid is a peel-back film label with product graphics, ConAgra MyPyramid food guidance information (see packworld.com/package-25222), and food preparation illustrations. More extensive microwave directions are shown on a p-s label on the side of the primary package.

Explains DeMars, “The technology behind the meals enables the starch ingredients and sauces to be separated during storage and preparation to preserve the ‘locked in’ flavor and texture of both, producing a fresh taste upon preparation.”

To ready the meal, consumers remove the pack’s steamer lid and sauce tray and add water to the rice or pasta, filling the bowl up to a clearly marked line. The steamer lid is replaced, and the rice/pasta is microwaved for approximately five minutes (depending on meal variety). Next, the consumer peels back the tab on the sauce tray and microwaves the sauce and meat for about 30 seconds. Once heated, the sauce and meat mixture is poured over the rice or pasta in the bowl, and lunch is ready.

In the case of Fresh Mixers, DeMars thinks consumers are willing to accept the relatively large amount of packaging versus product for the sake of convenience. “The overall convenience, taste, quality, and nutritional value of Healthy Choice Fresh Mixers are the result of the innovative packaging and cooking technology,” she says.

The meals are priced at $3.49 a piece and can be found in the pasta or prepared-foods aisles of retail food stores nationwide.

Paperboard promotes design innovation

While rigid plastic packaging is replacing traditional materials in many applications (see sidebar on p. 32), a recent study from Freedonia still reports that “folding paperboard box demand will increase 1.7% annually through 2012 to $10.5 billion.” The study, “Corrugated & Paperboard Boxes,” explains that folding carton sales will be supported by advances in printing and paperboard graphics capabilities and a better environmental image than plastic packaging.

When Target Corp., Minneapolis, MN, introduced a first-of-its-kind cereal pack in March, aesthetics and sustainability were certainly major considerations, as was creating consumer convenience in a category plagued by packaging complaints. “Target wanted to surprise and delight their store guests with an innovative package that merged design, function, value, and convenience all together for a refreshing approach to breakfast,” relates Derek Trader, market segment manager for Sonoco’s (www.sonoco.com) Consumer Marketing Group. Sonoco worked with Target to develop a custom-sized Linearpak® shaped paperboard container for the retailer’s Archer Farms brand breakfast cereal line.

Says Target spokesperson Jan O’Leary, “Customers continue to look for and appreciate convenience and value when it comes to food. These are key strategies for Target’s own-brand foods team with respect to both product and packaging.”

Replacing a standard, bag-in-box cereal pack, the new container sports an oblong shape and measures 53⁄4 in. wide, 10 in. tall, and 21⁄2 in. deep. According to Sonoco, the cereal pack is constructed of a film-coated foil liner, two plies of 100% recycled paperboard, and an eight-color flexo-printed paper label. Says Trader, the construction was chosen after rigorous laboratory testing ensured that it provided adequate product protection and met functional performance requirements.

The container is sealed with a peelable, tabbed, foil-laminate lidstock printed with product information. Critical to the container’s convenience factor, a custom injection-molded, friction-fit PP overcap, also from Sonoco, ensures that the cereal stays fresh after lidstock is removed, eliminating stale and unused cereal. The overcap is hinged at its midsection, allowing half of the lid to be flipped up for easy product dispensing. A transparent, circular “window” in the cap enables the consumer to easily check the volume of cereal in the pack after opening.

“A first for the breakfast cereal category, the new reclosable spout and lid design provides a facelift to traditional bag-in-box packaging,” says Trader. Available in 10 existing and eight new flavor varieties, the Archer Farms cereal line varies in weight, depending on the fruit, nut, and cereal combination and is priced from $3.49 to $3.99 per box.

Functional products demand packaging innovation

A rapidly growing segment in the food and beverage industry that is having an impact on both food content and packaging is the functional food and beverage market. “Functional foods providing health and beauty benefits are experiencing overwhelming growth, with Americans spending more than $27 billion on such products in 2007,” reveals a new report from The Center for Culinary Development (CCD), (www.ccdsf.com) and Packaged Facts (www.packagedfacts.com).

Reports another study from Euromonitor Intl. (www.euromonitor.com), “Sales of functional foods and beverages—including those positioned as ‘beauty foods’ (a.k.a., ‘nutracosmetics’ or ‘neutraceuticals’) as well as more health-positioned products—are growing faster than vitamins and dietary supplements.”

According to the CCD report, Baby Boomers, who account for a third of the U.S. population and spend about $2 trillion each year, are spending a growing proportion of that money on products that meet their desire for vitality. In addition, “their Gen Y kids are convinced that a little delicious daily maintenance can keep them youthful for years to come,” adds CCD CEO Kimberly Egan.

For many functional food and beverage products, maximum potency and effectiveness relies on the way in which ingredients are delivered. In July, Los Angeles-based Activate launched a line of functional beverages that depends upon a custom-designed cap to keep vitamins and other healthful ingredients fresh until consumption. According to the company’s Web site, “a study conducted by an independent analytical laboratory [shows that] vitamins and other healthful ingredients deteriorate sitting in water. Vitamin C loses 80% of its potency after only 30 days.”

Activate™ in four varieties—Immunity, Antioxi-dant, Energy, and Vitamin—consists of 16 oz of water packaged in a PET bottle capped by a custom closure that stores 3 g of dry ingredient. The bottle, from MPI Packaging (www.mpi-pkg.com), is distributed by Zuckerman Honickman (www.zh-inc.com), while the cap is from a proprietary supplier. When the consumer twists the upper cavity of the cap clockwise, an internal blade within the closure turns and pierces a plastic membrane separating the powdered formula from the water. After the membrane is cut, the ingredients are released into the beverage, which is then ready for consumption. A new iteration of the cap is planned for introduction in the spring that will hold more ingredient and will be more “distinguishable,” says the company.

Activate co-founder Anders Eisner tells PW that the greatest challenge in launching the functional drink was in engineering the packaging process. “We had to invest in very specific and fine machines that allowed us to fill the caps at a reasonable speed. Then we had to find just the right capping machines to be able to place these uncommon caps on the bottles. It took months of trial and error to find the right combinations of machines to run Activate at normal filling speeds.” Cap filling and application equipment is supplied by Nuspark, Inc. (www.nuspark.com).

Since Activate was introduced at retail—the beverage is currently sold in stores in Southern California, as well as on the company’s Web site, for $2.29/bottle—the challenge has become educating consumers about the how and why of the package. “We must get out there and show them,” says Eisner. So far, in-store sampling has proven successful. “The response has been very, very good,” Eisner says.

“Consumers totally understand that vitamins lose their potency sitting in water. It just makes sense. They love the fact that we provide a very functional, all-in-one delivery system. I can honestly say that people love Activate.”

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