Packaging & POP Memo: Lights, Sound, Video - On Packaging and In-Store Point-of-Purchase Displays

From the Natural~Specialty Foods Memo Editor's Desk: High technology is making its way to product packaging and in-store point-of purchase displays. Specifically, according to a report in the marketing and advertising publication Advertising Age, lights, sounds and streaming video are beginning to show up on product packages and in-store point-of purchase (POP) displays.

Perhaps in today's 24/7 electronic, plugged-in world, packaging and in-store displays are the next logical extension of technologies such as streaming video? On the other hand, do consumers really care, especially when it comes to packaging? And will the added costs of such packaging enhancements really lead to increased sales for the brands and products that use the electronic elements on the product packages?

Perhaps in the case of in-store point-of-purchase displays, features like electronic lights, video and sound can help draw attention to the displays and thus lead to increased sales. After all, various types of interactive POP displays have been around for many years. They just aren't as sophisticated as the ones mentioned in the Ad Age piece.

When it comes to product packaging we are skeptical. In some special cases, depending on the nature of the product, such technology might have some merit. And in the case of new product introductions it might be interesting to create a limited run say of the new products' labels featuring electronic ink or some form of streaming video for promotional purposes.

But in the case of the majority of food, grocery and health and beauty care-general merchandise items we are hard-pressed to think at this point in time consumers will be drawn to such bells and whistles on the outside of the product -- it's labels.

Rather, we think brand building the good old fashion way will still be what's key. Quality, value, price, an attractive package or label, marketed to generate trial and then to build brand isn't going to be replaced by technology applied to packaging in the vast majority of cases.

We are far from Luddites though, so we welcome the innovation, especially for in-store POP displays, and in those particular product packaging cases like we describe above for product packaging. Generally, the more options the better.

And we like enjoy the "Gee Whiz" factor at times as much as anybody.

Of course there is the "green factor" as well. Such as since the packaging will be electronic, won't it have to be disposed of in special ways like most electronic waste is. That could be a real kettle of worms. It's also something it appears to us the developers and users of this new packaging have yet to take into serious consideration.

Read the report from the October 20, 2008 issue of Advertising Age below:

Soon, Your Mayonnaise Label May Have Sight, Sound, Video
Electric Ink Could Be Low-Cost, Energy-Efficient Option for Advertising
By Jack Neff
October 20, 2008

BATAVIA, Ohio (AdAge.com) -- In-store displays and product packaging are getting a whole lot flashier -- literally, with lights and streaming video.

Henkel's Right Guard is testing use of printed electronics to power flashing lights in corrugated in-store displays at Walgreens stores in the Chicago area, a first step for a technology from Arizona start-up company Nth Degree that could eventually bring low-cost streaming video to printed displays, packaging, direct mail or magazine inserts.

Other tests are in the works involving other marketers and formats, according to people familiar with the matter, including one expected next year involving printed electronics on packaging for a Procter & Gamble Co. brand, believed to be a tissue-towel brand. P&G declined to comment on the project.

Anil Selby, VP-business development for Nth Degree, declined to comment on tests involving marketers, though he said the company has been in discussions with P&G, General Mills, Coca-Cola Co. and PepsiCo, among others.

Even for hardened marketers, it's hard to get past the gee-whiz factor. "It's just incredible what they're doing," said Tom Owen, director of in-store merchandising for Henkel of America (formerly known as Dial Corp.), when Nth Degree executives showed him an 8½-by-11-inch sheet of paper running a video snippet from the original "Star Trek" series. (Moving newspaper photographs in Harry Potter movies come to mind.)

Limited rollout

Henkel is taking a disciplined approach to evaluating the technology's commercial potential, which it's been testing in 27 Chicago-area stores, compared with a control group using the same basketball-themed display without the electronic enhancements in 27 other Chicago stores.

"When it comes to investing in something nationwide, cost will be a factor," said Mr. Owen, who has been working with the Alliance in-store marketing unit of corrugated display maker Rock-Tenn Co.

Nth Degree, based in Tempe, Ariz., near Henkel's Scottsdale headquarters, uses "wafer printing," employing conventional presses to print layers of ink that act like circuit boards.

The Right Guard displays use battery packs, but Mr. Selby said it's also possible to affix a wafer-thin power source directly onto paper or a package. He said he sees printed streaming video as part of a second phase of the technology's rollout.

The wafer-based inks are 90% more efficient than fluorescent lighting, environmentally friendly and can be powered using solar collectors, Mr. Selby said. The technology can be mass-produced cost effectively for as little as 20¢ per unit, he added, though initial installations are in the $3 to $10 range. That's one reason the company has targeted store displays that can reach hundreds or thousands of people at once.

Scale, individual attention

Mr. Selby ultimately sees the technology being used for outdoor ads, or as a cost-effective replacement for LED video displays in retail. Nth Degree can make displays individually addressable, allowing different messages in different stores.

Magazines also have been taking a look at electronic-ink technologies, most notably in the case of Esquire, which used it on the cover of its 75th- anniversary issue. Get a behind-the-scenes look at how that cover was put together in a 3 Minute Ad Age.

Packaging Memo: Innovative UK Grocer Waitrose to Start Selling Fresh Milk Packaged in Bags That Require 75% Less Plastic to Produce Than Plastic Jugs

British Supermarket chain Waitrose plans to soon begin selling fresh milk in bags in many of its stores in the United Kingdom (UK).

Milk, in bags, you ask? Yes indeed. The plastic sacks, which use 75% less plastic than plastic milk bottles or jugs which Waitrose will continue to sell, were tested by the innovative British grocer in a number of its stores last year. Waitrose tells us the test went well, and that it soon will start offering the plastic milk bags, called Eco Paks, in about 50 of its stores in the nation.

The Eco Pak milk-in-a-bag was created by Calon Wen, a Welsh dairy and fresh fruit and vegetable cooperative owned by about 20 farm families. The Calon Wen branded sacks of fresh milk will also have a bold "Ethical Trade" label on them, along with the words, "75% less packaging" to indicate that it takes 75% less plastic to produce one Eco Pak milk bag than it does to make a plastic milk jug that can hold the equivelent amount of fresh milk. Source-reduction is green.

Waitrose will continue to offer fresh milk in traditional plastic containers as well as tetra-type packaging. The retailer says it hopes to create an eco-friendly choice by offering the organic milk in the Eco-Paks. Although the traditional plastic milk bottles and jugs in the UK--and most elsewhere in the west--are 100% recyclable, they aren't recycled by consumers at very high rates. In fact, according to studies in the UK, of the 9 billion plastic bottles sold in the country annually, only about 7% of that total is recycled.

The benefit of the Eco Pak milk bags is that they use 75% less plastic in their creation than the traditional milk bottles do. As such, even with low plastic container recycling rates, they require far less petroleum and energy to produce, and thus are much greener overall than regular plastic milk jugs. Such source-reduction is increasingly becoming the key to creating more sustainable packaging. Waitrose also told us they're going to sell a reusable milk jug that consumers can pour the bagged milk into once they get it home.

Calon Wen Cooperative says other major UK food retailers are interested in selling the Eco Pak bagged milk as well. Richard Tomlinson, chairman of Calon Wen, says the dairy cooperative is the first milk producer and marketer in the country to recieve the UK Soil Association's Ethical Trade Symbol, which will soon begin showing up on the bags of organic milk in Waitrose stores throughout Britain.

We suggest Calon Wen try to license this technology to dairy cooperatives or processors in the United States. Retailers like Wal-Mart, Whole Foods Market and others are currently looking for packaging innovations that focus on source reduction, especially when it comes to plastics. In fact, Wal-Mart buyers have just started using a packaging scorecard with suppliers. One of the key criteria of the packaging scorecard is the environmental sustainability of a supplier's product packaging, including the amount of energy inputs used in packaging production. Since the Eco Pak bag requires 75% less plastic per package to produce vs. plastic milk jugs, the source-reduction should be right up Wal-Mart's sustainability alley.

Since Wal-Mart sells its own private-label fresh milk in the U.S., and has a major packaging source-reduction program in process, it would be logical--and smart--for the mega-retailer to offer fresh milk for sale in the Eco Paks as well as in traditional cartons and plastic jugs in its U.S. stores. In fact, we expect Wal-Mart's Asda chain in Britain to follow Waitrose's lead and begin selling milk in the Eco Pak bags soon.