The technology is in place, the market is primed and 'smart' packaging looks poised to really hit its stride Des King reports
Contrary to popular belief, revolutions rarely occur overnight. More to the point, by definition at any given time, what else are the best examples of most contemporary packaging if not smart? Ring-pulls, aerosols, even cling-film in its day have all been hailed as innovative cutting-edge advances on the road towards delivering more than just a protective covering.
Right now the ‘smart’ tag has been largely collared by the RFID brigade and, with Wal-Mart and Tesco both gearing up to make it mandatory, it is not too surprising that radio frequency is currently the most obvious point of focus.
“RFID technology, or radio barcodes, have great potential to offer our customers a better shopping trip and to make life easier for our staff,” says the UK’s highest profile shopkeeper Sir Terry Leahy. “We are actively involved in the development and testing of solutions and want to work with suppliers to introduce the technology where it can make a difference. Initially our trials have been on high value products, but the benefits to supply chain management can apply to all categories.”
Up-to-date developments and new applications in RFID technology are comprehensively covered by Packaging Today’s sister publication RFID Solutions. Suffice to say here, however, that positive retailer interest in adoption is pretty much a no-brainer. Reduced shrinkage [pilferage]; streamlined inventory control; anti-counterfeiting protection; and apportionment of blame in the event of faulty goods are just four clear benefits to be gained.
To get matters into perspective, global shrinkage adds up to almost €90bn per annum – around 1.5% of worldwide retail sales. Furthermore, Pira estimates EU manufacturers lose in excess of €60bn in potential retail sales each year to counterfeited products.
Justifiably, retailers see RFID as the logical next-step development to electronic article surveillance [EAS] source tagging technology, primarily geared towards the prevention of theft and usually seen in the form of a plastic tag or label applied to packaging by manufacturers. With the reduction in secondary packaging driven by environmental concerns, however, and the vulnerability of products within tagged packaging, the EAS solution is now increasingly under pressure.
According to Pira, the unit cost for an RFID-enhanced label replacement is predicted to be a fifth of its current value in three years time – still some way to go to a targeted €0.01, the price which would make it commercially viable for say a can of baked beans. With demand and take-up on the rise, eventual attainment of that goal is increasingly looking more science fact than fiction.
Less expensive but not as good
Other solutions such as electromagnetic [EMID] systems can fulfil many of the same functions as RFID – for example, tamper and theft evidence, tracking, location and so forth – as does the 2D barcode. However, while significantly less expensive, all fall short in providing a composite multi-purpose technology capable of meeting retail supply chain demands.
Research and development by suppliers such as BT, Microsoft, IBM, Exel, Texas Instruments, Philips, Checkpoint Systems, Alien Technologies, Paxar, and many more has opened up new applications and market sectors, while cutting the cost of implementation.
Low-cost RFID tags conventionally cost less than €0.83 and have a range of up to 1m. Tags with a range of greater than 1m cost around €4.15. Closer to hitting the can of beans target are a new breed of chipless RFID tags. Whilst these have tended to be read-only to date, the average cost is between €0.01-0.10 each.
Another route to more cost-effective tags could be via conductive inks. According to DuPont Microcircuit Materials, such inks are set to become the preferred manufacturing method for UHF RFID tags. “Sceenprinting is an easy to manage, one step process that has been successfully applied to the production of high volume, low cost RFID transponders,” says Francois Chirol, regional segment manager, Europe. He says most transponder manufacturers are still using “more costly and difficult to manage” manufacturing technologies such as copper etching, simply because “people have already made significant investments in that direction”.
But while retailers – and in consequence brand owners – are actively pursuing the RFID route, it would appear that some consumers are less enthusiastic about the prospect of what is suspiciously perceived as the equivalent of a stealth ID card. Lobby groups such as Caspian [Consumers Against Privacy Invasion & Numbering] are campaigning to have smart tagging curtailed by legislation.
Closer to home consider the divisions caused by ID card implementation proposals within the UK’s two major political parties – the highly vocal alarm bells are virtually identical. Unless nipped smartly in the bud, they could even impede if not stop the RFID bandwagon in its tracks, warns Steve Kelsey, director of design house PI3.
“It’s seen as an invasion of privacy but frankly this is a load of old baloney. Anyone who has a credit card or a loyalty card is already well on the way towards having all of their preferences captured. What really does strike home though is that they’ve charged off without engaging with the consumer and they could run into some real problems with implementation.”
Notwithstanding that smart has become synonymous with a retail-led game of tag designed to drive supply chain costs and efficiencies, there is still plenty of equally intelligent packaging innovation around to keep consumers happy, not to mention also far better informed and healthier. For example, plastic films that change colour to denote levels of freshness; enzyme-based time and temperature sensors; and cartons that can speak directly to consumers are increasingly in evidence.
Safety issues are paramount
Improved food safety is probably the single biggest requirement uppermost in the consumer’s mind. Despite clearly stated printed warnings, well over 50% of all UK consumers admit to eating food products beyond their expiry date. Add this to the ever burgeoning ‘takeaway’ culture and it is not surprising that around 5.5m Brits – and they’re just the recorded ones – are affected by food poisoning each year at an estimated cost to the UK economy of some £500m.
Pira estimates that the global diagnostic packaging market for inks and laminates will be worth around €20 million by 2007. Thermochromic inks are the front line, enabling mechanism to combat food freshness issues. According to UK time/temperature indicator technology developer Timestrip, an estimated €1.5bn per annum worth of food is thrown away unused after being left in the fridge.
Made from food-grade coloured inks, the Timestrip label is a diffusion-based product that changes colour over time and will monitor periods between 15 minutes and six months.
As a standalone item, the Timestrip self-adhesive smart tag is widely available via UK retail outlets such as Morrisons and Lakeland, but is now also beginning to be integrated within primary packaging solutions.
Outside of the UK, Timestrip has recently signed a distribution deal with a leading US label printer Daymark Food Safety Systems whose UK subsidiary is also marketing the solution into the domestic market’s foodservice sector.
According to Decorative Sleeves sales director Jon Cowan, the only thing holding back wider usage of thermochromic-based packaging solutions is the high cost of the inks themselves. “We get a lot of enquiries but these inks are very expensive.
Even using a single ink on a limited surface area for a pack running at decent volumes could increase the unit cost by between 5-10%. In consequence, it tends to be an application for added value products. That said, there is clearly an interest amongst brand owners to facilitate far better interactivity between the pack and the consumer, not to mention the obvious opportunities for enhanced on-shelf differentiation”.
Dairy Crest nudged the concept of a talking pack forward last year through its in-store “sing and win” promotional campaign geared to stimulate sales of its Vitalite margarine brand. Devised by branding specialists Toucan and flow-wrapped by Marsden Packaging [Blackburn], a patented light reactive chip was incorporated within selected units, enabling the pack to sing to a few lucky customers who in consequence won a Caribbean holiday.
The promotion grew Vitalite’s level of penetration, with 800,000 households buying over an eight-week period, and achieved an increase in Spontaneous Advertising Awareness from 1% pre- to 4% post-campaign.