Today, connected packaging/labels related digital transformation is typically seeing double digit annual growth across:

• Multiple vertical markets
• Multiple functionalities & business processes (creating ever more compelling business cases & ROIs for brand owners).

The new Vandagraf report looks deep into the complexities of this new reality by analysing this very fast evolving landscape.

By identifying new high-growth opportunities & future trends, the findings of this report can support readers in navigating this multi-facetted & changing world of connected packaging & digital transformation.

Our research has resulted in the identification of numerous very significant business opportunities (as well as some threats) across a number of industries with multiple major potential benefits. both broad scale & niche for:

• Brand owners
• Retailers
• Healthcare.

New opportunities are being fuelled by the commercialisation of muliple exponentially more powerful technologies that can be linked & leveraged with connected packaging & digital transformation.

Leading to corresponding opportunities for solution providers of several distinct types:

• suppliers of UID Devices - Wireless electronic and/or optical printed
• packaging/labels converters (primary item level / secondary, tertiary levels) – Carriers of Unique Identification (UID) codes
• developers of data management, analytics software, dedicated digital platform software
• developers of Artificial Intelligence (AI) & Machine Learning (ML) solutions
• developers of AR (Augmented Reality) solutions.
• other…….

Numerous companies (brand owners, retailers, healthcare, packaging/labels converters) have already gotten involved with innovative connected packaging/labels solutions – And these activities are described in detail in the Vandagraf report – Case Studies.

To link connected packaging/labels to the outside world, there exist several families of mature data carrier communication technology options:

• wireless electronic (e.g. RFID RAIN, NFC, Dual frequency, BLE, printed electronics
• printed, optically read codes (QR / 2D / linear barcodes / digital watermarks) – Overt or covert.

As well as some other approaches, for example: Touch Activated digitalised packaging/labels.

Incorporating such devices into packaging/labels enables connectivity to the digital world via a smartphone (*) or dedicated reader.

(*) The ubiquity of smartphones today means that consumers are able to capture UIDs on packaging/labels according to individual smartphone capabilities.

Mass consumer empowerment was historically not an option because consumers did not carry personal readers (i.e. smartphones) in their pockets or handbags.

Smartphones have enabled consumer identification of UID codes while also offering high levels of security, with reliability & robustness. An on-packaging/label carrier of the UID can be verified either by texting it via SMS.

It is generally easier to justify higher value wireless devices on premium products that have a higher unit cost, such as, luxury products, alcoholic drinks, personal care products & the like, as well as healthcare products.

• Specialty products – RAIN RFID / NFC - Higher unit cost - shorter production runs – can meet requirements for special features / functionalities
• Commodity products – Optical printed solutions (incl QR codes & digital watermarking) - Lower unit cost - longer production runs - More basic connectivity / less functionality

Although much higher cost than printable codes, wireless / electronic devices offer significantly greater functionality and interactivity, together with other advantages.

Optical printed solutions in general are better placed to meet price-sensitive connected packaging/labels applications criteria for lower price point (commodity) branded products. The trend to low-cost optical solutions has been accelerated by dramatic growth in the usage of QR codes globally.

Optical solutions are popular particularly for limited performance requirement consumer engagement applications, such as loyalty programmes, coupons, special offers and the like.

The middle ground – ‘grey areas’ - between specialty & commodity product categories are likely to see the fiercest competition between electronic / wireless, optical & other technologies.

Digital Transformation & the Packaging/Labels

The packaging market is in the throes of fundamental upheaval & transformation in the face of a number of powerful drivers & forces and this is a major & dynamic industry trend.

Connected packaging/labels is a key enabler for product-related digital transformation, fulfilling a central role as UID data carriers.

For several decades, companies have been investing in new software & systems to progress the overarching digital transformation process across almost all aspects of their businesses (Enterprise-wide Digitalisation – Industry 4.0).

The notable exception being product-related digital transformation in relation to actual products/packaging/labels, which have tended to be left behind in the wake of the general trend and have been markedly slow to gain traction to date.

This means that in a world where brands have digitalised or automated almost every process and byte of data, most of their actual products still cannot provide a digital footprint or data on exact current location of the majority of its products - or indeed much information at all after they leave the factory gate.

This is surprising given that such product-related digital transformation offers huge potential benefits & revenue potential in multiple types of functionalities across a number of vertical markets.

The reality in 2023 is that many brand owners still do not know precisely the location of all their products at any given time

And this lack of insight translates into great inefficiencies & many missed opportunities (large & small).

In addition, the substantial capital investments that many companies have typically already made in digital transformation across other parts of the business is not going to deliver as much value as it could.

And this must be seen as a key vulnerability for companies that are not already starting to pro-actively embrace product-related digitalisation at this time.

All the more so, in view of the major investments that have typically already been made in supply chain management software by many companies that cannot yet be exploited to their full capacity & potential.

All the technology needed to empower digitally enabled products to communicate with the world around them is already commercially available today.

So, it is now entirely viable to endow formerly analogue products with the ability to communicate with a digital world.

And there is a clear path forward towards completing digital transformation of a company’s operations must include a comprehensive integration of connected packaging/labels into a company’s overall strategy & implementation.

The majority of stakeholders have been becoming aware of this issue (incl. brand owners, retailers as well as packaging/labels converters) and are already upgrading their IT systems to accommodate new requirements associated with integrating data relating to product-related digitalisation.

By 2023, there are strong indicators that the process of product-related digital transformation has reached a major tipping point & the transformation process is set to accelerate strongly in coming years.

Definition: Connected packaging/labels carry a device / feature that transforms packaged branded products in order to provide:

• A Unique ID
• A gateway to the Internet.

Key Benefits of Item Level Connected Packaging

New ways to capture & manipulate item level product-related unique data have emerged to become essential building blocks in the context of wider digital transformation across an organisation.

As more widespread digitalisation & connectivity of products/packaging/label data is rolled out across vertical markets this will open the flood gates to a huge leap in terms of data availability leading to an abundance of benefits, large & small.

So, enabling brand owners to extend control of their products far beyond previous limits.

And this means that a raft of historically challenging problems can be addressed. so that items can move seamlessly.

Key Benefits

• complete visibility of item level data carried on primary packaging/labels (as well as secondary/tertiary packaging) reaching across the entire supply chain from factory gate, through distribution centres/warehousing to retailer (both front & back of store) and beyond to post purchase consumer & ultimately to end-of-life processing
• single silo data consolidation of all data relating to primary/secondary/tertiary packaging/labels - Likely within a company’s existing Enterprise Resource Planning (ERP) software system - Leading to greater unification of data across a company’s entire ecosystem leads to greater unification of data across a company’s entire ecosystem- streamlining operations and enhancing operational efficiency
• all data can be fully integrated, aggregated, automated, synchronised & cross-referenced with all other product data & updated in real time, providing full product status information to authorised parties (both in-house and also other authorised outside parties along the supply chain, as appropriate) - every interaction can be recorded providing a detailed audit trail
• full integration & transparency can be extended across multiple channels (omnichannel) & locations, incl. eCommerce activities, enabling product availability checks, company-wide, optimising product availability
• consolidated data can be linked to product orders, so that demand & supply can be much more closely matched - any place - any time, with efficient automated replenishment from retailer all the way back to manufacturing
• multimodal planning can be facilitated - Planning the best routes for road, rail, ocean, and air with established tools, such as a transportation cockpit, making transportation management a frictionless part of inbound, outbound, and internal logistics processes - optimising product journeys and reduce costs
• control grey market activities as well as the introduction of illicit counterfeit goods into legitimate supply chains
• control theft & pilfering
• help to address & meet fast changing customer expectations, maintaining & enhancing customer relationships, while gathering customer behavioural data
• enabling automated processes, workflows & materials planning, help companies to eliminate manual processes, saving time & resources, leading to efficiency gains, cost savings,
• facilitate sustainability and the circular economy, including management of post purchase, ‘waste’ packaging.

Altogether resulting in multiple gains in efficiency, transparency & control, enabling a far more granular level of transparency, leading to very substantial cost savings across many areas.

Consolidation of Multiple Data Silos to a Single Database

Multiple unconnected data storing silos (company mainframes/ cloud) that have developed independently over time are still typically still the norm for many companies today, based on traditional analogue systems.

This a great source of great inefficiency & confusion, to which company staff have traditionally become accustomed.

Huge benefits can be leveraged, simply by consolidating all product-related data into a single interactive database/silo.

Product-related connected packaging/labels & digital transformation offers the opportunity to migrate all of a company’s product-related data to a single database (silo) of factual inventory data with real-time accuracy, enabling anytime, anywhere access to centralised product intelligence.

No longer, do different parties along the supply chain (from factory gate through the supply chain to retail / eCommerce & beyond) need to operate & share different (and often out-dated & inconsistent) versions of product status, location & inventory information.

Linking Digital Platforms to ERP Software Systems

The data associated with digitalised connected packaging/labels can be integrated into a company’s existing Enterprise Resource Planning (ERP) software system enabling faster decision making with fewer errors.

ERP is the integrated management of main business processes, in real-time, that facilitates management and interpretation of data flow between all business functions, both inside the boundaries of the organisation & other 3rd party stakeholders, as required.

ERP provides an integrated, and continuously updated, view of core business processes using common databases

ERP systems are widely seen as critical for managing businesses of all sizes and industries today.

Enormous additional benefits will become a reality once such ERP software systems can be re-configured & extended to accommodate digitalised products/ packaging/ labels at item level.

Note: Cloud versus On-Pack Data Storage - Options for storing data are summarised as follows:

• On the pack itself - this requires a microchip / memory RFID chip, requiring substantial memory and or/processing capacity
• In the Cloud (or hybrid cloud) - when all that is needed is a readable UID on the pack, without on-pack data storage being required - data sets can be managed within the cloud based digital platforms.

A key factor is the cost of memory storage & any microprocessors on a chip-based device. Given the very low cost of storing data in the cloud there usually needs to be a good reason for storing data on actual packaging.

Data security is also a key factor, and it can be more secure to store sensitive data in the cloud. Cloud-based applications have grown in recent years with information being readily available from any location with Internet access.

AI capabilities that can be built into cloud ERP.

“Connected Packaging/Labels, Unique IDs & Digital Transformation”

Healthcare, Apparel & Footwear, Beauty & Personal Care, Luxury Products, Wines & Spirits, Food & Grocery Retail

World Markets & Technologies - Opportunities & Trends

With quantitative market sizing estimates for 2023 with forecasts to 2028 & longer-term predictions to 2032

Publication: July 2024

Digital Transformation has been gradual over an extended period, however, by 2023, the process has been accelerating markedly. And arguably a major tipping point has now been reached.

While transformation has already been extensively integrated across most business functions, the digitalisation of actual packaging/labels at item level has to some extent lagged behind.

Although, UID data carrier technology (RFID / NFC / BLE / QR codes, digital watermarking and so on) is well established, exploiting these UIDs has been quite cumbersome for users.

Meanwhile, there has been a great proliferation of dedicated ‘Digital Platforms’ that cater for specific vertical markets.

This recent proliferation of more user-friendly software / internet-based digital platforms typically embodying special features has facilitated usage & fuelling user pull, as potential benefits become increasingly self-evident.

The next crucial step to advance the Digital Transformation of a company’s operations is the comprehensive integration of connected packaging/labels into a company’s overall strategy & implementation.

So, stakeholders (incl. brand owners as well as packaging / labels converters) are upgrading their IT systems to accommodate new requirements.

Packaging / labels converters fulfil a key role as UID data carriers.

By harvesting & leveraging digitalised data, a number of powerful functionalities & benefits become accessible to stakeholders.

This approach is being made much more viable, due to recent important technological advances that are enabling companies to ameliorate operations & solve long standing issues.

Thus, providing opportunities for companies to build competitive advantage and avoid being left behind.

Furthermore, the Fourth Industrial Revolution – Industry 4.0 – is being facilitated by the confluence of a host of new technologies and innovations that includes:

At the same time there is a climate of increasing government & organisational regulatory constraints across several key vertical markets.

Today, packaging /labels related Digital Transformation is typically seeing double digit CAGRs across a range of business processes, that is being enabled by:

• The range of mature data carrier options
• A rapidly maturing provider base of digital platforms.

This new Vandagraf Report takes a ‘deep dive’ into the complexities of this new reality by analysing the overall technical and commercial landscape, including:

• Where the technology has got to
• Who is doing what already and why
• Where the action is in each the 6 vertical markets reviewed (Healthcare, Apparel & Footwear, Beauty & Personal Care, Luxury Products, Wines & Spirits, Food)
• With quantitative market sizing estimates & forecasts.

By identifying the new high-growth opportunities being created and future trends, the Report is therefore designed to support subscribers in navigating what is a complex & rapidly evolving space, in relation to business decisions, road mapping & strategy.

Note: The new report follows on from a series of previous studies that Vandagraf has researched & published, together with numerous dedicated single client studies addressing related topics.

List Price: €4,800 Euros.

Publication: July 2024 (early bird pre-publication discount 25%, for orders received by end June).

A Full Table of Contents of the report is available on request - contact:

James Bevan – Director - Vandagraf International Limited

jbevan@vandagraf.com

+44 77 11 946 447.Report List Price: €4,800 Euros.

Publication: January 2025

This very comprehensive report comprises 2 volumes:

• Volume 1 - Market Analysis – Market Evolution & Opportunities - Breakdown by Vertical Markets – 400 pages
• Volume 2 – Technology Analysis – 140 pages.

Also available on request:

• PDF version of this document
• Full Tables of Contents of the report.

Labels, flexible packaging, folding cartons, corrugated board, direct-to-3D packaging profiles

Food, Healthcare, Drinks, Personal Care, Automotive

Markets & Technologies - Opportunities & Trends

A techno-economic market report Published 2022

Evaluation of markets & business opportunities with a technology overview and solution provider company profiles.

Status of markets and technology in 2022, with forecasts to 2027.

This report comprises 2 Volumes:

• Volume 1 – Technology Overview – 148 pages
• Volume 2 – Selected End User Vertical Markets – 264 pages

2022 with forecasts to 2027

Offline / Online

Packaging, Labels, Security Printing & Substrate Materials

Fashion & Sports Apparel / Clothing & Footwear (incl. Sneakers),Watches & Jewellery, Bags & Luggage (Leather goods, Women’s Handbags, Sports bags), Sunglasses, Beauty & Personal Care (Fragrances, Cosmetics, Skincare).

Business and market opportunities, competitive analysis & technology

Status of markets and technology in 2021, with forecasts to 2026.

A techno-economic market report Published 2021

This report comprises 2 Volumes:

• Volume 1 – Markets, Landscape & Trends - End User Vertical Markets – 167 pages
• Volume 2 - Technology Overview - Counterfeiting - Brand Protection Solutions - Opportunities & Trends-Summary of Market Sizing, Forecasts & Opportunities – 178 pages