Global developments in packaging

LUXE packaging has dominated the latest developments and innovations in global packaging, according to market analysts Mintel. At the personal care and cosmetics event PCHi 2014 in Shanghai, Mintel provided insights on user-centered packaging, demonstrated innovations in packaging of products sold worldwide, and presented current trends in global innovation in packaging, especially in cosmetics industry.

Dr. Benjamin Punchard, Global Packaging Insights director at Mintel, said recent innovations are marked by the consumer demand for luxury, but also by three aspects that align with user-centered packaging: convenience, trust, and delight or an expectation for something that’s different, fun and interactive.

An appetite for the luxurious

Global beauty launches in all price positions are on the rise, especially in the Prestige section. In 2013, launches in Prestige brands grew by over 40% to surpass new packaging across all variants. The most rapid growth over 2010 to 2013, however, was seen in Luxe and Super Luxe, with 2010-2013 CAGR of over 10% for both categories.

Asia is becoming a huge luxury goods market, largely because of the size of China’s increasingly affluent middle class. Chinese consumers are buying luxury goods not only domestically, but also on trips to duty-free havens Hong Kong and Macau as well as overseas.

In a November 2013 internet survey of 1,000 Chinese consumers aged 20 to 49 years, one-third of the respondents surveyed said they had made purchases of luxury items in the past year. Luxury food items purchased within China (41%) topped the list followed by cosmetics (31%). What is notable is the comparable share of purchases of luxury cosmetics as against luxury food in HK/Macau (29% vs. 15%) and overseas (26% vs 15%). Clearly, there is an opportunity for the market for Luxe and Super Luxe beauty products to grow.

Another internet survey conducted in April 2012 concerning an intent to buy luxury items involving over 1,500 respondents classified as middle-class consumers indicated this growing appetite. Over 60% of those surveyed expressed their interests in clothes, bags and footwear, and 55% said they would buy luxury cosmetics and perfumes the next year.

A matter of convenience

One mega trend that continues to influence innovation in packaging in the cosmetics industry is convenience, owing to the increasingly hectic lifestyle being led by more and more consumers. When it comes to convenience in packaging, consumers might look for ease of use, portability and availability whenever required. Or all three.

Small-sized packaging, for instance, facilitates the demand for portability and ease of use. They are easier to be tucked into relatively small bags and luggage, allowed on board, and most importantly, able to preserve the quality of the products.

A resealable pouch or recloseable spout, which helps avoiding contamination, adds to the convenience appeal. The targets for such packages are not only women on the go, but certain groups of consumers with active lifestyles. For example, in Europe small pouches with recloseable spouts are positioned for active and sporty men.

The “ease of use” provided by resealable packaging and such claims made on the packages are increasing rapidly and continuously over the world markets. However, growth in Asia Pacific lags behind the global trend. Though increasing, the number of launches with ease of use claims in Asia Pacific lags behind the global trend suggesting, Dr. Punchard pointed out, that opportunities still exist in Asian market in the future.

One most of the most noticeable phenomena in Asia concerning beauty, personal care and household products is that small packaging often means single use — which allows consumers to pay less at particular period of time and to choose and test before they decide on the most suitable products. Single-use packaging, while often giving an impression of “economy pack”, aren’t limited to fast moving consumer goods and regular, go-to brands.

Premium brands that want to offer single-use convenience and yet maintain a proper packaging that suits the positioning of the product are turning to small rigid pots – similar to pods use for single-serve coffee capsules – that combine convenience and affordability. Innisfree and Too Cool for School are two companies that are using small rigid pots to offer the convenience of an affordable single-use pack but without the perception that this is an economy pack. This trend is now being replicated in the United States, where high-end cosmetics and body care retailer Sephora is using this strategy with its $1 pod of body wash, offering customers a wide range of scent choices.

Trust and confidence

Safety scares in the food and beauty industries, including products from well-known brands, were widely reported last year in China. Another survey conducted by Mintel involving 2,513 female Chinese internet users aged 20+ who have used or bought skin and body care products in the past 12 months shows that 90% of the respondents are concerned about the safety of the products, and tend to buy those with natural ingredients. Over 80% of those surveyed check the ingredients before they buy a product.

Packaging can greatly help the safety appeal and/or reinforce the “natural statement”. Products with natural formulas can make their claim more trustworthy by combining natural elements into their packaging, e.g. plant-based packing materials and inks, which are associated with harmless and healthy images.

Packaging technologies can also help eliminate doubts in customers’ mind. For example, Tata Harper and Caudalíe are communicating to consumers that their airless packaging mean that their products contain fewer “bad” preservatives.”

Personal involvement may also increase consumer confidence in products, Dr. Punchard said, as he cited “Tune It” by Sepai allows users to add active portions into the main product by themselves. Through this step, the brand gives consumers control and may give them a clearer idea of the ingredients.

Designed to delight

Today’s consumers expect much more from buying. It is not only the product itself they want, there has to be spiritual experience as well. Whether it is the artful way the package is created or whether the packaging entrances a customer with an element of surprise, packaging increasingly must be designed to delight.

Customization is one of the ways consumers heighten this experience. In the U.S. market, for instance, 1 in 4 consumers believe the option to customize or personalize a product is one of the ways to define luxury. Two ways in which to engage customers through customization are:

Self-expression – Allow customers to express themselves, add their own design and share their own creation via social network. A good example of expressing yourself was the “Arty” limited edition packaging of “Play for Her” fragrance from Givenchy. While the famous graffiti artist, André, designed the perfume’s box, the bottle was left to the creativity of the customer as a “blank canvas” that could be customized and shown off if desired.

Personalization – Allow customers to select a design that is unique and personal to them. This strategy was used by beauty brand Japonesque to encourage customers to get a random pattern on the packaging and create a personal keepsake.

The three levels of design – convenience, trust and delight – Dr. Punchard explained, relate to behavioral, reflective and visceral experiences of consumers, are inspiring innovation in global beauty packaging industry. In each aspect of user-centered design, packaging can provide solutions or engage the emotions of the consumer, which eventually lead to purchasing.

Dr. Benjamin Punchard, Mintel Global Packaging Insights director, holds over 8 years of extensive international packaging experience. He holds significant experience in conceiving, conducting and delivering quantitative and qualitative research, and has worked with leading multinational packaging companies and brand owners to deliver strategic market recommendations.