The continued surge in e-commerce has presented numerous opportunities for label and packaging growth in a wide range of sectors. According to Adobe Analytics data released this year, online spending grew 4.9% year-over-year to $222.1 billion during the 2023 holiday season. This trend was already on the rise prior to 2020, but the shifting dynamics of shopping have become a mainstay for modern consumers.

“Customers are now used to the many conveniences e-commerce brings – such as being able to shop from home, oftentimes with a bigger selection,” explains Craig Lombardi, director of sales, Packaging Solutions, RRD. “While most brands already had an online presence, the pandemic taught brands how to be agile and work on facilitating new communication channels with their customers.”

However, the boom in online shopping and subsequent supply chain challenges – like raw material shortages ¬– taxed many in the label and packaging value chain. Communication was a critical factor of success. As companies navigated the tough terrain of the pandemic, e-commerce emerged as a staple for the modern shopper. Label converters have leveraged this opportunity to further promote brands in an omni-channel environment.

While the product is the same, the shopping experience has transformed throughout the years.

“Shopping is a multi-faceted experience – conversing with sales associates, browsing, learning about brands, weighing purchasing options, and departing with your purchased package in-hand,” says Andrew Palmer, director of sales, Labels and Forms, RRD. “During this time, customers form their opinions about brands. With a rise in e-commerce, packaging and labels take on the large responsibility of conveying a brand’s image and values. With no physical interaction with a brand ahead of purchase, customers’ shopping experience comes down to only one physical stage – the unboxing.”

Brands should maintain consistency across channels and convey their brand image and values regardless of the point of purchase, but as discussed, important considerations should be paid to how the customer experience differs through various channels.

“Brands focused on sustainability may look to decrease the amount of materials they use and increase the presence of recyclable materials, but structural integrity is paramount for e-commerce orders,” comments Palmer. “One of our customers in the baking industry has different packaging for brick-and-mortar stores than for e-commerce orders. Due to the nature of their products, which need to stay fresh and arrive intact and uncontaminated, more protective packaging is required when the product is shipped. Additionally, while customers can interact with a brand’s signage and assets in-store, they don’t have the same opportunity online, so heightened packaging with eye-catching enhancements and/or structures allows brands to create a similar impact on customers.”

In 2023, RRD expanded design and printing capabilities with the EFI Nozomi C18000 Plus single-pass digital inkjet printer. This addition helped RRD maximize color and design options while delivering consistent print quality for an elevated and personalized unboxing experience. In the labels space, RRD has seen a rise in demand for variable imaged shipping labels, which cannot only be customized to represent the brand but can also change the way customers interact with the purchased products.   

“Companies have realized the importance of improving their e-commerce-specific packaging and are now opting for methods such as ship in own container (SIOC) packaging, which aims to establish a personal relationship with the customers,” notes Palmer. “Not only does SIOC packaging reduce waste by eliminating the need for additional packaging materials, when used in conjunction with CleanTac ultra-removable labels, it adds value when the consumer may need to repurpose the shipping container.”

The recent supply chain challenges have better prepared both converters and brands to serve the evolving e-commerce space. Brands are faced with the consistent challenge of keeping the right amount of supply readily available. Smart labels, including barcodes and RFID tags, help businesses keep track of inventory, monitor shipments, and forecast future demand.

“Beyond enhancing the overall customer experience, the use of linerless labels eliminates the paper backing associated with traditional labels, ultimately reducing waste,” says Lombardi. “As reported in RRD’s 2023 (Un)Packaging Reality Report, 90% of respondents found sustainability to be a key consideration in packaging and label decisions – it is clear brands are prioritizing sustainability, and small changes such as implementing ultra-removable labels will go a long way in achieving their sustainability goals.”

According to Lombardi, there are a multitude of trends to watch in the future. For example, there are new band considerations to monitor.

“According to the National Retail Federation, for every $1 billion in sales, the average retailer incurs $165 million in merchandise returns,” explains Lombardi. “Ultra-removable labels withstand the rigors of packages making their way through the supply chain and are able to be repositioned or removed easily and cleanly. This means if the customer needs to return an item, they can simply peel off the shipping label to affix the return label for shipment. RRD continues to develop tailored, innovative, and sustainable solutions such as this one for all our customers.”

Additionally, the following statistics are worth noting from RRD’s (Un)Packaging Reality Report:

• 87% stated disruptions to the global supply chain caused their organization to change how they source packaging and/or labels.
• 37% developed e-commerce-specific package design/structure.
• 66% report they are likely to make sustainability-led changes to current packaging in the next two to five years.
• 79% of those who saw increased label needs also struggled to find labels that met standards for cost efficiency.