RRD releases 2024 Packaging & Labels Insight Report

RRD's 2024 Packaging and Labels Insight Report has highlighted that most companies facing inflation-related pressures prioritize packaging, label functionality and product safety. They are also investing in sustainability initiatives and expanding their e-commerce operations to meet customer demand better.

The company’s third-annual survey of 300 packaging and label decision-makers shows that, with increased in-store and online competition, inflation, and rising material costs, many are paying specific attention to the core fundamentals of production protection and material composition.

‘As consumers demand higher accountability from the brands they choose to support, building functional design and safety features into packaging remains essential to ensuring product integrity and a great user experience,’ said Lisa Pruett, president of the RRD packaging and labels segment. ‘Meeting this increasing demand will require a balance between three competing priorities: protection, convenience, and brand appeal. Brands that strike this balance with their packaging will have an opportunity to deliver a product experience customers can trust, boosting loyalty and reducing damage concerns.’

As e-commerce demand increases, functionality and product safety remain top priorities, and brands are willing to invest in the right materials. RRD’s latest report shows three quarters (75 percent) of packaging and over half (60 percent) of label respondents expect to make functional design-related changes (strength, size, opening) in the next two years, while 73 percent and 70 percent, respectively, plan to make material composition changes. Additionally, most packaging (86 percent) and label (79 percent) respondents agree that inflation and rising costs of raw materials have caused changes in how their organization sources packaging and labels over the past year.

When asked to assess factors motivating their expected packaging changes, respondents rated consumer or end-user appeal (48 percent), efficiencies in storage/distribution (47 percent), and increased product protection (46 percent) as the top three major priorities. Top motivations for label respondents include pressure to lower costs (45 percent), meeting new regulations (41 percent), and new products or product changes (40 percent).

Along with a focus on materials, companies continue to prioritize, track, and make adjustments that impact overall company sustainability performance. With a heightened emphasis on brand sustainability performance and increasing customer demand for eco-friendly products, companies strive to meet internal and external stakeholder expectations. Fifty-seven percent of packaging respondents indicate they are taking sustainable and eco-friendly aesthetic direction over the next two years to appeal to buyers.

Most packaging (83 percent) and label (80 percent) respondents say their companies have moved closer to their sustainability goals, with 81 and 79 percent, respectively, indicating their packaging and label operations specifically have moved them closer to their sustainability goals. For packaging respondents, the reduction of material waste (69 percent) remains a top sustainability consideration when making packaging design decisions, followed by material recyclability (68 percent) and material removal/light-weighting (54 percent).

Following a year of tremendous e-commerce growth shown in RRD’s 2023 report, most packaging (78 percent) and label (79 percent) respondents reported a rise in their e-commerce business over the past year. From customer preferences for convenience to brand agility and cost-saving considerations, e-commerce continues to evolve, and companies are investing in ways to attract customer attention online. 

Of those trying to meet growing demand, over half (55 percent) of respondents have designed packaging specifically for e-commerce, up 18 percent from RRD’s 2023 report. Of those who have seen an increase in e-commerce activity, product protection and customer satisfaction were top considerations for companies. When asked how companies are ensuring products are packaged safely and arrive without issue, packaging (64 percent) and label (67 percent) respondents say they are using specialized materials for added protection, and 58 and 66 percent, respectively, are focusing on end-user feedback and reviews to impact packaging decisions.

Read the full report at www.rrd.com/packaging-labels-report-2024.