Top 10 Trends Driving the Future of Beverage Packaging

Transcript

Tracy: Welcome to Beyond the Mold: a podcast about the breakthrough innovations and the experts who are pushing the boundaries of traditional injection molding, packaging design, and sustainability. I'm Tracy Broad of Husky Injection Molding Systems.

Tracy: Hello everyone. Today, we're speaking with Sylvain Talarico, our Global Director of PET Tooling here at Husky Injection Molding Systems. Sylvain, to kick things off today, can I have you tell us a bit more about what you do, and for how long you've been in this role?

Sylvain: Sure. Thanks Tracy, and hello everyone. I am part of the Husky organization since the late 90s, and I have always been around PET preform injection and PET application since that time.

Sylvain: The beauty of my personal journey is that I've been part of and have supported all the major trends you observed during these years. It started with the standardization of specific dispensing system for segments like water, carbonated soft drinks, and even sensitive product including juices and dairy. And over the 2000s, we started to work on the first lightweighting initiatives, bringing, of course, lighter package solutions and lighter neck finishes.

Sylvain: And my journey never stop until today. We furthermore sustainability focus and environmental consciousness.

Tracy: Sylvain, can you tell us a little bit about what we're going to cover off today?

Sylvain: Sure. Today we'll go through the latest beverage packaging trends and, of course, how Husky will help you to move forward.

Tracy: What insights does Husky bring to this conversation? And why is Husky best positioned to deliver these insights, in your opinion?

Sylvain: Actually, Tracy, Husky is in the fortunate position of being at the forefront of market trends and the evolution of beverage packaging. Thanks to a wide mission install base, Husky is deeply involved in many new and innovative package development project in close collaboration with all main customers, design agencies, and whole major packaging line equipment supplier. This is a reason why we have a clear understanding and analysis of the beverage market trends.

Tracy: What are the major forces driving these trends, and why do you think these trends are appearing now?

Sylvain: Beverage packaging has really evolved a lot in the recent years, Tracy. Driven by a number of forces including technology innovations, changing consumer preferences, increased competition, and last but not least new legislative requirements.

Tracy: In your opinion, Sylvain, what should brands be thinking about now as these trends unfold?

Sylvain: The evolution of these trends was disrupted over the past year as COVID-19 sent shockwaves throughout world markets. This year, we do expect the disruption from COVID varients to continue, but that the longer term evolutionary market trends will continue to unfold at varying rates. Some trends are still connected to COVID variants and some are more mid- and long-term involving sustainability, smart packaging, and tethering functions.

Tracy: Let's get into it. Trend number one. We look at how consumer shopping habits have been altered during the global pandemic and the shift from single use packages through to large format packaging. Tell me about how that has impacted beverage producers and brands.

Sylvain: The global pandemic had a big impact on pattern of consumptions. Since consumers are doing fewer trips to the grocery stores, we saw an increased demand for larger beverage packages and multi-packs for smaller sizes. It may be some time before this consumption trends stabilize into the next normal, so producers needs to remain agile and adaptable.

Sylvain: What is clear is that PET has many great advantages compared to other packaging materials. With its freedom of design, flexibility, and its convenience for larger sized containers.

Tracy: Trend number two. I find myself shopping more online and having products delivered to my home. How has the use of e-commerce pushed brands or challenged brands to be more consumer-focused and consumer-friendly in getting products to homes?

Sylvain: We have all noticed that more and more products are delivered than ever before. With e-commerce in mind, PET packaging becomes a very compelling option for producers since it is less prone to breaking or damage during delivery. PET does also help packages to be lighter in weight. That really helps to reduce you to footprints.

Tracy: Sylvain, for trend number three, we're often asking ourselves the question, "Do I feel safe drinking this?" When you think about consumers and their focus on hygiene and safety during this unprecedented time we're living through with the global pandemic, how are beverage packaging trends being driven by hygiene and hygiene related preferences with consumers today?

Sylvain: The global pandemic brought hygiene and food safety to the forefront, and consumers are now more hygiene consumers than ever. Many more consumers opting for safe packaging options, such as PET bottles, which are resealable and have drinking surfaces free from exposure to airborne contaminants, unlike metal cans. Regardless of what lies ahead with COVID-19, it is likely that these hygiene related preferences are here to stay for the long-term. Producers will need to take this into account as they choose packaging solution for their applications.

Tracy: Looking at trend number four, Sylvain, the impact of COVID-19 has seen products now sitting on shelves in grocery stores for longer periods of time, and now preservation and quality have become a concern for producers. How does beverage packaging and how do beverage packaging producers take this into consideration when looking at their packaging options?

Sylvain: Indeed, this is another impact of COVID-19, and it makes it more of a challenge to keep products preserved up to the point of consumption. As a result, we are seeing more producers focusing on ways to prolong shelf life using technologies like cutting and multi-layer packaging solutions. The multi-layer packaging solutions offered by Husky suit well application like dairy product, sensitive beverages, and small format carbonated soft drinks. Each of these applications need specific protection from oxygen ingress, CO2 loss, and light exposure to guarantee product shelf life. And of course, these technologies head in preservation and protection for these applications.

Tracy: Sylvain, being halfway through the list now at trend number five, we're seeing a rising demand for nutritious health focused beverage. Tell me about this trend and what this means in terms of SKU proliferation and having a more fragmented product landscape. What does this mean to beverage producers

Sylvain: Pandemics put more attention of personal health as immune system, for example. Brands offering a wider variety of products to meet the demand. In functional drinks, here are many, many different products, categories with, for example, antioxidant, nutraceutical, bioactive compound, probiotic, prebiotics, and that list, of course, is not exhaustive.

Sylvain: All market segments are concerned, and this is part of an overall trend toward consumers looking for more diverse beverage options, leading to what we call SKU proliferation, which is relating resulting in a larger and more fragmented product landscape. Again, this means that in order to remain competitive, brands needs to be agile and adaptable to produce larger portfolios of applications.

Tracy: Trend number six. We're seeing a push towards sustainable packaging. How are consumers driving this trend in their desire to associate themselves with brands who offer packaging that is made out of recycled materials?

Sylvain: Because simply the trends toward more sustainable packaging is here to stay for the long term. Legislation is a huge driver of this, and the single use plastic regulation here in Europe is a great example. The top sustainability trends we expect to see include the reduced use of PET resin through lightweighting initiatives, increasing use of recycled PET, as known as rPET, and increase conversion to recycled PET from other packaging materials that are non-food grade recyclable in a circular economy stream like polypropylene or polystyrene.

Sylvain: We see this evolution embraced by leading brands introducing packaging made from 1% recycled PET. Please keep in mind recycled PET price is higher than virgin PET price because of its current volume of production, so any kind of lightweighting initiatives like neck conversions are most welcome to optimize the total cost of ownership of a package.

Tracy: And trend number seven. When selecting a product or standing in front of a fridge and a consumer is looking at packages, many are driven towards a premium packaging or one that's different than the others. Talk to me about trend number seven where we see a premium look and feel, and how does that stand out on the store shelves?

Sylvain: This is another driver of SKU's proliferation appealing to niche markets. The success of this product is due in large part to packaging innovation that gives products a premium look and feel thanks to design features such as color gradient or thermochromic effect that help them stand out from the competition

Tracy: Trend number eight looking at personalized packaging and engaging with consumers. Producers are looking for new ways to differentiate themselves from competitors and stay engaged with consumers long after the package has been consumed. Talk to me about this personalized packaging to order and how brands are now taking this to the next level.

Sylvain: As producers seek new ways to engage with consumer and differentiate from their competitors, we are also seeing a rise in more personalized packaging. A popular example of this was a campaign of a major carbonated soft drink brand placing individual names on bottles. Many brands are now taking this to the next level, offering personalized packaging to order with e-commerce with customizable imagery and texts configurable by the consumer on the internet hub. These are great ways to engage consumers as it make it easier to order products.

Tracy: Trend number nine we look at smart packaging. As we see a growing number of beverage package designs that incorporate smart technologies, we see QR codes, NFC, and RFID chips. These technologies are designed to provide an immersive and interactive experience. How is this trend now emerging as something that's really important for brands to make sure that they stay engaged with their consumers?

Sylvain: We are seeing a growing number of beverage package designs incorporate smart technologies, including QR code or even chips that do not require any internet connection to transfer data. These technologies are being used to deliver immersive and interactive experiences for consumers, anti-counterfeiting for premium brands, and provide valuable additional information about products.

Sylvain: Another key driver of smart packaging is that it enables products to be easy to trace in the supply chain and authenticated. Smart packaging is an exciting vector for beverage packaging, and we expect to see much wider adoption in the coming years.

Tracy: Thanks, Sylvan. And trend number 10, which I think is probably the one that's the most at the forefront at the moment, is tethered closures given the impending legislation and other trends we're seeing around the world. Can you tell us more about this one?

Sylvain: Clear. Clear, Tracy. As part of a broader sustainability initiative, the European Union, with the single use plastic regulation, will require tethered closure for most single use plastic container by 2024. We expect other regions around the world to adopt similar legislation soon. It is just a matter of when, not if. We are seeing growing trend of adoption of tethered closure by producer who are looking to get ahead of the legislation. Brands have also turned to tethering as a way to introduce a unique premium experience as a point of differentiation from the competitor. Current interest in tethering suggests that the coming year will be a breakout year for tethered closure worldwide.

Tracy: Thanks, Sylvain. If we look at top 10 trends, we've covered a lot today. What would you say are the big takeaways for beverage packaging producers?

Sylvain: You see, Tracy, the review of the trend shows that this is one of the most dynamic periods in the history of beverage packaging. Capitalizing on these trends will require beverage packaging producer to get to know the different PET applications. It will also require staying agile and alert to the ongoing changes. Successful producer will learn into the expertise of experienced partners, such as Husky, who can help them evolve quickly and with minimal risk. Finally, producers will get to know their own home countries' policies to all the recycling and tethered closures.

Sylvain: And of course, we at Husky are privileged, and will be excited to be part of a journey for so many customers worldwide.

Tracy: Great. Thanks, Sylvain. In closing, what are the best resources available for producers to educate themselves on these trends and some of the ones that perhaps they're not as familiar with that they should consider?

Sylvain: You see, Tracy, ideally, let's lead them toward us, toward Husky resources. In case they have a packaging idea they like to explore, I am really inviting them to stay in touch with us as they will get a specific assessment of their case.

Sylvain: Our idea here is to guide them through the examples and experiences we build up globally over years. We, of course, also including this podcast, all the accesses to the latest webinars, guide, and calculators we recently published. So let's stay in touch.

Sylvain: Tracy, let me thank you for hosting me today.

Tracy: It was a pleasure having you, Sylvain. Thanks for joining me today.

Tracy: Thanks for joining us. Check out our show notes for resources discussed in today's episode, and if you like what you heard, rate and review us on Spotify, Apple, or wherever you get your podcasts. We'll see you next time as we venture beyond the mold.