I know I’m lucky. I know that the rooms I get to speak in and the people I get to meet, gives me a privileged understanding of what is happening in today’s world of print & packaging. To a certain extent, I am being asked for my opinions and helping to influence those happenings too. Now, of course I would never betray the non disclosure agreements that I have in place for these conversations but what I wanted to write about this month is a phenomenon that could have a huge effect on the packaging industry as a whole.
The biggest single change in all of our world’s in the last 25 years has been the internet. Everything has changed, and I mean everything, about the way we live our lives as a result. From sharing cute videos of your pets, to controlling your central heating via WiFi, to communicating with relatives all over the world instantly, to carrying a powerful computer in your pocket – that occasionally makes calls. Everything has changed. And one of the biggest changes has been the way we shop, the places we shop, the times we shop and even if we leave the house anymore to shop. I’m talking about the Amazon effect.
I won’t bore you with the statistics and quote the huge gazillions of sales (although curiously no profits) that Amazon enjoy, as this has all been very well documented. What I want to talk about is the effect this has had on the traditional bricks and mortar retailers and grocers. Anyone who has supplied packaging to these guys over the last 30 years will still have the bruises to show for it! The endless driving down of costs has turned print and packaging into a penny parade of commodity pricing. But something has changed and I think you are going to like it.
I sat in a two-day advisory board meeting in Belgium last week with five of the world’s largest consumer brands, and by large I mean a combined €300 billion of global sales between them. The focus of the meeting was on packaging and how digital printing for folding carton, flexo and corrugated is going to add value back in to the commoditised world of printed packaging. One by one, these brands all said the same thing: Amazon has changed how retailers and grocers are behaving. Suddenly, instead of just asking for cost reductions, they are asking for help. Help to compete with Amazon. Help to differentiate themselves in the crowded and noisy world of retailing.
We are at the inflexion point. The exact moment when the worm turns and the value is added back into an industry that has suffered for a long time. But you can’t just keep calm and carry on as before – the theme of my recent speeches to the packaging industry has been constant. You can’t just change the tools (digital printing) – you have to change the behaviour. No longer can you think analogue in a digital world, especially when these brands and retailers are crying out for your help.
The next generation of consumers know what they want to buy and how they want to buy it and that will dictate the next phase of your businesses. The much talked about millennials are as interested in experience as they are in price. It’s time to embrace the opportunity rather than defend the legacy. It’s easy for me to say that of course as I don’t have a vested interest in the packaging industry, but as an optimistic and enthusiastic commentator on the whole print and packaging world – I hope I can help give you some tips on how to navigate the Amazon…