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Packaging’s changing role in an online world

New study uncovers how the migration from in-store to online shopping is affecting the retail environment, and the changing role of packaging in these environments.

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Online shopping is growing by leaps and bounds in every retail category from household goods and mass merchandise to clothing and electronics, at the expense of the bricks-and-mortar shopping experience. In late 2012, Canadian branding and design firm Shikatani Lacroix released results of a survey it conducted with research firm Hotspex to understand the breadth of this change in shopping behavior and its impact on the retail industry. For consumer packaged goods companies, the challenge is to optimize both online and in-store sales opportunities. And in this new environment, where value and price rule, packaging innovation will play an even greater role. 


According to Jean-Pierre Lacroix, R.G.D., president and founder of Shikatani Lacroix, one of the greatest insights gleaned from the new study, “Re:Store - Redefining Retail,” is that “consumers are very predisposed to do online shopping,” he says. “And, when they shop online, Amazon.com dominates.”


Notes the study, depending upon the category, approximately 30% to 50% of American shoppers make half their purchases online. In electronics/appliances, that percentage jumps to 52%. In the next five to 10 years, the study estimates that consumers’ online shopping activity will continue to grow, with shoppers expecting to move at least half of their shopping activity online rather than in store.


Currently, when it comes to crossover shopping (shopping in-store and online), Re:Store notes that between 50% to 70% of shoppers browse in-store and then buy online, depending on the category. “Only 29 percent of the people who decide to shop outside the store and do so online go to the retailer’s Web site,” says Lacroix. “The remainder goes to non-retailer Web sites, of which Amazon.com is 45 percent.”


For a retailer, this is a huge concern. “For a packaged goods company, this means that Amazon.com is now one of your biggest customers when it comes to your retail network,” advises Lacroix. “So start looking at Amazon.com as a retail channel, and give it the same attention that you would if you were talking to Costco or Kroger or any other channel. Develop products that appeal to their segment of the marketplace.”


In the online environment, it is price, not packaging, that drives purchase. According to Re:Store respondents, the overriding reason they purchase products online versus in-store is price, with over half the respondents saying that online prices are better. But there are ways CPGs can bring value through packaging to online shoppers. One way Lacroix suggests is by bundling frequently purchased products.

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