Why digital packaging is a huge opportunity, and a colossal challenge

April 4, 2017


In a world where tech can be integrated into everything—from brushes that give you a daily update on hair breakage to interactive beer bottles—digitally connected packaging presents both a challenge and an incredible opportunity for companies looking to integrate further into consumers’ lives.

In truth, the possibilities for brands are almost endless. Smart packaging presents an opportunity to transform a physical interface into an interactive brand tool. Brands can add real value to their customers’ lives, going beyond the everyday and offering a means of connecting products to the burgeoning Internet of Things.

Don’t be a branding Icarus

Corporations should not allow themselves to be dazzled by the endless possibilities of the coming smart packaging revolution. Like Icarus flying too close to the sun only to find his wings had melted, brands that make the leap without properly considering smart packaging from the perspective of their corporate brand could find that they’ve both diminished brand value and lost consumer trust.

Brands should approach digital packaging as a means of connecting meaningfully with customers, not as a way to bombard them with pointless features. The real questions brands should be asking: How can we naturally extend each interaction without losing sight of brand meaning or alienating consumers? And how can we make appropriate and meaningful contributions to our consumers’ lives?

Find your relevance

To maintain an authentic connection with consumers, brands should evaluate which areas of a consumer’s life they’re qualified to play a role in and expand their offering from there. For example, not too long ago, Diageo unveiled a prototype smart whisky bottle for its premium Johnnie Walker Blue Label Whisky brand. The bottles incorporated a printed electronic tag, which, in a limited edition run, provided owners with the ability to send personalized digital postcards and VIP invitations, access luxury lifestyle content, and download cocktail recipes.

Through its smart packaging, Johnnie Walker attempted to transform and influence the way we enjoy our favorite spirits. Its approach stemmed from a tight focus on and an awareness of how the brand contributes to consumers’ lives—specifically with regard to how drinks can complement and enhance our social experiences.

It is easy to see how a company like Diageo could extend the capabilities of its smart packaging to other related aspects of consumers’ lives without compromising the meaning behind its brands. Imagine, for example, that you’re hosting drinks before a night out and by the time you leave your house there is a queue at your favorite local haunt, making it unlikely that you’ll get in—a real dampener on your evening. Instead, your spirit of choice has not only alerted you to this, but suggested an alternative venue and offered a taxi to get you there. Every single one of these actions would further integrate the Johnnie Walker brand into your life, while holding true to Diageo’s core mission of adding value to social experiences by “celebrating life every day, everywhere.”

Moving past “zero”

With the potential of further integration into consumers’ lives comes a responsibility that has hitherto been reserved for digital brands. Picture another scenario, in which a coffee brand organizes the start of your day. Previously your first interaction with the brand would have been when you groggily opened your cupboard, desperate for your early morning coffee fix. With smart packaging, however, you could literally wake up with the brand: Imagine that the packaging for your coffee grounds controls your alarm clock, and it won’t tell the coffee machine to start brewing until you stop hitting snooze. In addition, it sends alerts to your phone with alternative travel routes if it anticipates a delay in your morning commute. From a consumer’s perspective, this undoubtedly would be useful. From a branding perspective, invaluable. The coffee brand would have the opportunity to move past the “zero moment”—the moment when consumers first decide which brand or product to buy. By making itself indispensable in an entirely new aspect of the consumer’s routine, the coffee brand prevents the consumer from turning to other brands for their needs.

First, however, it must build up enough trust to be allowed access.

Permissions and branding

If a brand uses digital packaging, it is not only attempting to further integrate itself into consumers’ lives, but also asking permission to do so.

For instance, the coffee brand that takes charge of your morning will grow to learn your patterns, where you work, and even what time you leave the house. This information could be used to send you targeted ads on your commute or recommend restocking your coffee from partnering retailers near your office when you’re running low.

Unlike digital brands such as Amazon or Google, those without a history for gathering data will have to prove to consumers that they can be trusted both to safeguard and use that information responsibly. Trust is the last vanguard between the human and the machine world. In the smart packaging revolution, it is brands that understand this that will rise to the top.

This piece was first published as “Why the biggest challenge, and opportunity, for packaging is digital” in Packaging News (7 March 2017). Republished with permission.

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