In this edition of Pack Snacks, Editor-in-Chief, Danielle Sauve talks to Esko’s Product Managers Susie Stitzel, Timothy Sixta and Esko’s Global Vice President, Sales and Services, Niels Stenfeldt about artificial intelligence, omnichannel’s impact on product packaging and paperboard packaging’s prominence in the luxury goods industry.
This Economist article highlights the ways Artificial intelligence (AI) is used in various scenarios across the value chain. However, manufacturers have started using AI to forecast what order items will arrive and leave a warehouse so it can put its pallets in the right position. What are others ways that AI can help with product packaging’s value chain?
Stenfeldt: Artificial Intelligence applications are similar in use in some of the technology that supports packaging development and execution today. One example is pre-flight software, which is set up to automatically check the specifications of a packaging file, like the resolution of images, the presence of all fonts, etc. This is a way designers can check their work before sending files to the printer, or printers can use it to automatically reject and give a reason report to designers or pre-media agencies that are submitting files for quotes.
There are also tools available to detect differences between the master file and a new version of a packaging file. These tools scan and compare the files pixel by pixel, then highlight the differences and create a checklist for the proofreader to review. This is like a digital assistant, enabling the proofreader to off-load the detection of differences to the machine and focus on whether the differences are expected or not, and what action to take next. This is an example of a combination of computer vision and AI to decimate proofing time and effort.
Stitzel: You can also use algorithm-enabled software to instantly determine the most efficient arrangement of cases of product on a pallet or a half pallet. This intelligent palletization reduces the amount of airspace shipped per truckload and makes shipping more efficient.
Regarding logistics, the increase in the number of SKUs (also called SKU proliferation) poses a big inventory problem forCPGs. They either have to reduce the number of SKUs, hold fewer of each product in inventory or divide inventory between warehouses, possibly creating a delay in delivery, which consumers may not like.
More and more, people see something online and then buy it in a store – the online representation of the real world has to match. The customer is tying these things together. When there is a virtual assistant that recommends the product for you, that means the stakes are even higher than the product recommended (its online image and information) accurately matches what’s available on the physical shelf.
Sephora has been working feverishly to build holistic 360 data on their consumers, tracking in-store purchases, interactions with salespeople, online browsing and online purchasing. What does this mean for beauty products in terms of packaging for on-the-shelf versus online?
Sixta: I noted this quote from Sephora about their physical, in-store sales and online sales: “We end up competing against each other a lot of the time.” I have to think that merging physical and digital is partly achieved by merging physical packaging with marketing, which is has become digital-obsessed.
The real insight in this article is that “Mobile is the glue that holds it all together,” because mobile is the connection between physical and digital. The phone digitizes physical touch. It’s also the camera that’sin the mobile phone – how is that camera going to interpret data as a user pans across a shelf? Is that app able to pick up what that information is?
Stitzel: Companies that want to merge physical and digital, whether in-store with online or physical packaging with digital marketing need to first get their data in order. The fact is that CPG companies aren’t that digitized, everything is manual and paper and Excel-based. Most companies couldn’t do this if they wanted to, and most may not have even thought about it yet. [See also our "intelligent packaging” article.]
Stenfeldt: Packaging files can be the resource for computer vision technologies to assist in bridging the gap between physical and digital. Companies could get started faster if they’d use the packaging files instead of creating separate work streams to solve for e-commerce.
Paper and paperboard have continued to be a strong pack type within the luxury and premium product segments due to their ability to print metallics and high end finishes flawlessly. The design appeal of printed packaging designs on paperboard invites consumers to reach out and touch the product. But how do designers get that next-level look and finish?
Stitzel: I teach a paperboard boot camp class, and so, I love this topic. All the companies quoted in this article use fit-for-purpose packaging tools to design boxes (CAD software) as well as create quick renderings in 3D. Without these tools, it would be incredibly difficult and expensive to design a luxury box, not to mention get approval from the customer.
The structural design of these isn’t the biggest deal, but the visualization of the printing effects are very important. Being able to visualize all these effects on paperboard for luxury packaging helps printers/converters upsell their capabilities. Virtualizing the different materials on-screen is how printers sell-in their ideas to give the brand the confidence they need to invest in these expensive packages.
Foil finishes, coatings, crimping, embossing, hot foil stamping, metallic inks, opaque white, clear boxes, matte and gloss varnishes, holographic foils, iridescent pigments: these are things you can’t actually achieve on a comp or mock-up (outside the actual production run). And a production run is at least 10x more expensive than a comp. One easy example is a shrink sleeve that is clearon an opaque bottle, how do you comp that? You can’t do that accurately.
Being able to visualize before you produce anything helps reduce the cost in so many ways.