Independent report reveals 85% of brands are increasing investment in QR and NFC in next 12 months
Packaging Solutions
SharpEnd has launched its second Connected Experience Report, offering fully independent industry insights from UK and US c-suite executives at more than 1000 global brands across key sectors. The report looks into why and how brands are engaging with consumers.
Key findings include:
Some 96% of brands believe connected packaging should be an important component in their marketing strategy, with 92% saying first party data is a key pillar of their marketing strategy.
85% of brands plan to increase their investment in connected products in the next 12 months.
85% of brands are willing to pay more to be able to integrate Near Field Communication (NFC) into their products.
93% of brands will be using connected packaging as a part of their sustainability initiatives within two years.
The primary incentives for brands to invest in connected technology are to create personalised consumer experiences and interactive experiences for brand engagement.
The report demonstrates that brands believe demand from consumers for QR codes (95%) and NFC (93%) is huge. While QR codes are the more recognised packaging technology integration, the findings of the report also suggest an overwhelming preference for the use of NFC, which can be further unlocked by better education amongst brands surrounding its uses and benefits.
Further to this, 85% of brands said they believe their suppliers have the ability to incorporate NFC into their products and packaging, however currently only 51% believe they are doing so, suggesting significant room for growth.
The report’s emphasis on the growing demand for ‘value add digital experiences’ from consumers is likely to appeal to brands wanting to build their own first party data capabilities, which allows them greater insights into how, where and why consumers are interacting with their products and wider media touchpoints.
First party data has traditionally been challenging for brands to access as it is held by retailers who act as the intermediary between brands and consumers. Connected packaging technologies enable brands to get closer to their consumers through virtual or mixed reality experiences, whilst generating their own first party data that can then be used for multiple purposes from new product development to consumer insights to optimising the wider marketing budget.
The report shows brand marketeers believe that one of the biggest drivers to invest in QR, NFC and AR is to create more personalised consumer experiences (23%).
When delving deeper into the data, there are similarities and differences across sectors in terms of attitudes towards, and uses of, QR and NFC to create consumer experiences.
The alcoholic beverages sector has both the widest current use of QR and NFC within its marketing programmes (82%), and also shows the biggest intent to invest more in the next 12 months (88%). Aligned to this it was also the sector most willing to pay more for NFC solutions (90%).
Healthcare and wellness led the way on using QR and NFC to educate about the product (60%) and to improve accessibility (60%), suggesting that there is a focus on using digital experiences to help consumers understand and use products better.
The consumer packaged goods sector has the strongest indicators for using QR and NFC for sustainability, with 89% saying that connected packaging would help to achieve sustainability goals and 94% saying that brands should adopt connected experiences to help with sustainability efforts.
Interestingly, despite the high levels of desire to use connected packaging technology to achieve sustainability goals, the report highlights that 72% of brands are worried about being labelled as ‘greenwashing’, so have limited customer outreach regarding sustainability. This stresses a need for brands to adopt technologies and platforms they trust, and that allows them to share their product story in credible and sincere ways.
The consumer packaged goods sector showed the strongest desire for connected packaging to be used for recycling (67%), with healthcare having the strongest desire for behaviour change (57%) and alcoholic beverages had the strongest desire to use connected packaging for nutritional guides (48%).
Taking a longer term view, the report delves into the future of packaging technology, including legislative and policy changes that may impact certain sectors. Brands believe that digital triggers on pack may become mandatory for certain areas such as sustainability credentials (50%), authentication (46%), ingredients and provenance (44%) and legitimising product claims (42%).
Cameron Worth, CEO of SharpEnd, said: ‘We have done a lot to build this industry over the last ten years and independent research has been fundamental in helping to educate brands about the possibilities. I am happy to present the second volume of our independently conducted Connected Experience Report, and thankfully the data is on our side with brands clearly to scale.’
In January, the company announced a significant investment and partnership with Fedrigoni, which will see SharpEnd strengthen its position in the global market to develop new products and high performing integrated solutions using QR, NFC and RFID.
‘The results of this survey uncover a very promising trend, confirming our long term vision,’ said Antonio Linardi, Fedrigoni's RFID business director.
‘We are witnessing an exponential growth of connections between the physical and the digital worlds, inevitably resulting in the need for connected solutions – tailored to both companies and consumers. This interest is paving the way for significant innovations throughout the industry, and strengthens our position as a strategic partner for brands interested in smart packaging and labels, based on NFC/RFID technologies.’
