Bay Cities’ Crystal Ball of 2019 for the Corrugated Packaging Industry
Welcome to 2019! This could be one of the wildest years yet! Last year was a very good year as predicted for the corrugated packaging and POP display business.
The industry did realize some slowing with box demand in general. Now it isn’t all that bad — it just seems to be a bit flat. The industry had a boom through the end of 2017 and going into 2018 which could be attributed to the explosion of e-commerce? That was fun. We will enjoy a continued bump through mid-February 2019 as we Americans exploit our new tradition of sending stuff in brown boxes back. Remember, 30 percent of everything bought online is returned. One wonders what happened to that big holiday rush of brown boxes that we enjoyed last Christmas season. Well, that is not going to grow much more than it has because Amazon has decided to do something very smart for the environment and for all mankind as we know it. They set forth a campaign to reduce the usage of corrugated boxes and the right sizing of brown boxes through their distribution system. They will reduce the overall use of corrugated boxes by 500,000,000. Yes, five hundred million or half a billion brown boxes. They can do this because they are about 50 percent of all online retail sales. Wow, that’s huge!
This year Amazon is looking for another reduction in corrugated box use as measured by existing 2018 sales through their Frustration-Free Packaging program. Pay attention here because the news is very interesting. They are demanding that every SKU that goes through their barn must comply with the ISTA6-Amazon certification; and if it does not comply by October 1, 2019, a $1.99 surcharge will be allotted to each item. The exclusions to this compliance are: Hazmat boxes, Prime Pantry/Amazon Fresh and Drop Ship items (not fulfilled by Amazon). This means that you should talk to your corrugated box maker right now and check if your corrugated packaging is compliant or will need to be redesigned. If you want to learn more, go to Amazon and look up Amazon Frustration-Free Packaging Program Standard (APASS) and educate yourself.
Let’s look at what’s going on at retail. As the regular shopper continues to haunt the retail environment, he/she is looking for an experience more than ever. Shopper marketing shows that brands have two fronts to wage war — on-shelf and online. Both wars are fighting to retain their identity. This now must be complemented with experiential packaging, custom corrugated packaging, exciting POP displays and online experiences. Your brand is much more than a product. Shopper marketing best practices indicate that your brand attracts attention to the product.
More and more technologies are positioning themselves as useful tools for this new phenomenon. Once again, the dominant tool shoppers are using the most is that wonderful thing in your hand right now – the mobile phone. This is THE key to all sales. We are looking for more from this unit. First, you must employ mobile search ability. If you think for one second you are going to master the new world thinking your website or ecommerce site or whatever site you use to get your brand out there can be utilized by a notebook or desktop, you are missing the biggest clue to the brave new world as dictated by shopper marketing. It must be mobile-ready. Secondly, if you are not beginning to use video in your messaging, you will be passed up. Lastly, write stories. Remember, only beliefs change behaviors and stories are what change beliefs. Plus, people love hearing stories.
One of the biggest challenges across industries will be the struggle of finding people. What is even more challenging is retaining people. This year will be the year of the great grab. Everyone of your employees is getting a minimum of two offers every month. More than 50% of them are thinking of leaving. This is, of course, if you have been treating them poorly and have not been creating a thriving, learning and growing enterprise. Now is the time where everyone will be stealing your employees and you will be stealing everyone else’s employees. If you haven’t already, start paying attention to those people running your operations and do something special for them every day.
Remember, happiness is a quality box, and everything comes in one!
Welcome to 2019 — it is going to be wild!