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Packaging Up E-Commerce

By Leslie Lang

June 4, 2019

It’s easy to forget that e-commerce started only in the mid-1990s, because it got so big so fast. In 2017, an estimated 1.66 billion people worldwide bought products online and spent about $2.3 trillion. That amount may more than double in just four years when, Statista projects, e-commerce revenues will be about $4.8 trillion.

And, of course, all those goods have to be packaged up for delivery. A report from Future Market Insights says the global retail e-commerce packaging market is projected to grow from $13 billion to about $21.4 billion by the end of 2026. From just 2014 to 2016, shipment volumes were up more than 30 percent, and consequently, the demand for boxes and other packaging has grown precipitously as well.

The meteoric rise of e-commerce is having an enormous effect on the global packaging industry. What does that mean for AICC members trying to keep up with rising demand, and how can they position their companies to take better advantage of it?

Tami Cullen, business manager at Dallas Container Corp., points out that some e-commerce impacts have been indirect and unmeasured. “When Amazon opened up a distribution center here in the Dallas-Fort Worth area, some of the big guys took on a lot of that Amazon business,” she says.

“And that, in turn, left some of their smaller clients scrambling because they didn’t have enough capacity to run their orders on a timely basis. It was kind of a bonanza for us. We’ve been able to pick up a lot of that business. We don’t really sell to Amazon directly, but we sell to some of the smaller retailers and several of the subscription services. It’s good for independents because it’s steady business monthly.”

“It’s not a box. It’s a delivery and marketing vehicle, and if you sell it just as a box, good luck.”

— Chuck Delaney, vice president of retail sales and marketing, Dusobox

Evolution of an Industry

Chuck Delaney, vice president of retail sales and marketing at Dusobox, says the rapidly growing industry means there’s a lot of room and space for a company to set itself apart from the competition. “Because this isn’t a 20-, 30-, or 40-year-old mature industry but is relatively new, people are looking for innovative ideas,” he says. “There’s an evolution going on. I think there’s a huge upside depending on how you approach it.”

Miriam Brafman, CEO of Packlane, agrees. Because she founded the company just four years ago, her core customers have always been e-commerce and subscription box merchants, although she says the customer base has diversified over time. Even in that short time, she says, she has seen tremendous growth in her business, which she credits to the surging tide of e-commerce.

Brafman says boxes become an iconic type of branding, a billboard for digitally native and e-commerce brands whose customers don’t get to walk in and have an in-store experience. She has worked to optimize Packlane’s offerings to take advantage of, and suit, those e-commerce needs.

They offer three types of boxes—mailers for gift or subscription boxes and e-commerce packaging; folding cartons for products on the retail shelf, such as beauty packaging, supplements, and chocolate; and corrugated shipping boxes for larger, heavier, or fragile items. All are targeted toward e-commerce customers and their preferences for shipping and presentation value. All can be customized with branding and graphics, which is not unusual, but what is different is how Packlane works with its e-commerce and other customers.

“We are pretty unique in that we only allow customers to order through our website,” she says. “So it’s a web-to-print company.” Customers upload their graphics to Packlane’s 3D tools and can then see a visualization of how their packaging will look before it prints. All ordering takes place online.

“A lot of people realize it’s valuable to pay a premium to have that kind of custom-branded packaging, so where Packlane comes in is, we make that really easy for brands to do. They upload their graphics directly to one of our packaging styles, which are specifically geared toward e-commerce, and then order it directly from our website.”

The Perfect Fit

Packlane also focuses its products for e-commerce brands by providing custom-sized boxes that do not require tooling. Customers can select a custom-​sized parcel that fits their product just right, and matching the box size to the contents also reduces waste. Brafman says this is important to e-commerce brands. And not only does it cut down on wasted and unnecessary void fill, but it can reduce shipping costs, as well.

Another important factor, according to Brafman, is speed. Packlane works to serve its e-commerce customers by reducing production time and getting orders out fast. “A lot of our orders are subscription boxes where they have a deadline every month when they have to get their shipments out to customers,” she says. “So, we try to be really mindful of that by keeping production times low.”

Delaney also stresses how important speed is in the world of e-commerce. “Time is the measure, and speed is the currency,” he says. “My friend Tom Miller came up with that. He started as the marketing director for Temple-Inland in Indianapolis probably 40 years ago.”

Businesses in the industry, he says, must structure themselves with technology—not just with people. “Technology that is practical,” he explains, “in that it gives answers to the buyers faster than anybody else can. Whether that’s a fast price, whether that’s a fast proof, or a fast design, everything is going to be predicated upon speed, especially in this industry.

“At Dusobox, we take customers on the entire journey, going from the concept through the consumer engagement,” he says, “and we automate every one of those steps—everything from doing the pricing to the design that they can see.”

“I’ve printed more on the inside of boxes in the past three years than I ever did in the former 25.”

— Tami Cullen, business manager, Dallas Container Corp.

Printing

To succeed in this new e-commerce world, Delaney says, you need an operation that is “multiprint-faceted, meaning it can handle a high-end flexo.” That is important, he stresses, because the product—the box—is taking the place of retail.

“It’s not a box. It’s a delivery and marketing vehicle, and if you sell it just as a box, good luck. You’re not going to come across as a pro.

“So you’ll have flexo, you’ll have litho, and you’ll have digital,” he says. “To me, if you can produce all three out of your plant, and perhaps have the converting execution capability, you’re in. You can help establish that you are a one-stop shop that can handle that array of different press needs.”

Cullen, too, talks about how much printing has changed with e-commerce. “I’ve printed more on the inside of boxes in the past three years than I ever did in the former 25.”

Mastering ‘Marketing Speak’

Delaney posits that to truly be in the driver’s seat with a client, a company needs to have a dynamic person who knows retail marketing on the front end—someone who understands marketing language and how to pitch products to the right people with the right words.

“We’re good at box speak,” he says, “and we’re good with sourcing, but when you take that next step up the line with marketing people, they want to talk marketing speak. They want to know, how are we going to integrate a QR code or text-to-video into the second moment of truth on the box. Most corrugated reps don’t feel comfortable talking about features like that; I’ll guarantee it.”

You can separate yourself from the competition, he says, with a dynamic internal agency that helps you drive specific messaging through that box and out to the consumer. “I think there’s a whole untapped front end of content development that will help you if you leverage variable content that accents and drives your equipment,” he says. “Our equipment helps us separate to a point. But when someone opens a box and sees your QR code with a 20 percent discount coupon for a referral, or that 83 percent of people typically will use a coupon to make an additional purchase of your product if they feel it’s very unique to them—those are some of the things you have to be able to talk about, and articulate, in this e-commerce business. Not ‘we can make a box.’

“This is a retail vehicle,” he stresses. “It’s not just a shipper.”

A New Way of Thinking

Although the industry has changed, Delaney says, not everybody in the industry has. “Right now, digital is helping to make a big impact because we’re able to run short-run business. We’re able to help those million-dollar new e-commerce companies be able to afford a box, versus having to buy a die first and buy the printing plates and all of those elements. It’s very dynamic.”

He says that the subscription boxes so popular today are all about the “me generation.” “What we’re doing is working, I think, very well,” he says. “And there are all sorts of sales channels that you can also land that you’ve never had the opportunity to land before.”

Something else important to keep in mind when strategizing how to best take advantage of rising demand? For years, he says, he has heard that you can do business only within a 250-mile radius of your plant.

“Balderdash. Wrong. But for all you who want to keep on thinking that,” he says with a laugh, “please do, because then I don’t have to worry about competing with those who think this way.”


width=150Leslie Lang is a Hawaii-based freelance technology writer.