Shaping the future of packaging: Trends and innovations to watch in 2024

In 2024, the packaging industry will face new trends, innovations and challenges. Our MD, Paul Clarke discussed how DS Smith is responding to these changes focusing on e-commerce, value and sustainability.

At the start of a new year, it’s an important time for businesses to reflect on their strategic priorities and consider where they can make refinements over the next 12 months. One such area will be packaging, where changing consumer behaviours, economic challenges, and the ongoing drive towards more sustainable solutions will all contribute to decision-making and business plans throughout the year. At DS Smith, we have been closely monitoring these trends to not only adapt but also innovate for a future that demands more from packaging solutions.

E-commerce's Unrelenting Importance

The way consumers shop has transformed dramatically. An increasing preference for online shopping, driven by convenience and lifestyle changes, has become evident. In the UK, internet sales now represent over 25% of retail sales, with over 80% of the population engaging in e-commerce purchases. This shift places immense pressure on businesses to ensure their e-commerce packaging solutions are top-notch.

At DS Smith, we're aiding customers in responding to these evolving demands. Our 2023 UK consumer study highlighted three key focus areas for retailers in e-commerce packaging:

1. Sustainability: Consumers are increasingly eco-conscious. Our research indicates that 1 in 4 online shoppers would cease ordering from a company due to excessive, non-recyclable packaging.
2. Durability and Protection: Packaging must protect goods effectively. With 32% of consumers experiencing damaged packaging, and 58% likely to stop ordering from a company due to repeated damaged products, this is a critical area.
3. Ease of Returns: A smooth return process is essential, as 29% of consumers find the current process frustrating.

Innovation like our Tape Back solution is designed to address these concerns, offering seamless, sustainable returns and reducing non-recyclables, thereby enhancing recyclability.

Value is King for Consumers

The financial landscape for consumers remains challenging. With many experiencing a worsened financial situation and negative disposable income, 2024 could be similarly taxing. Consequently, consumption patterns are evolving, with 73% making fewer impulse purchases and 54% buying in smaller quantities.

Retailers are adapting by delivering value through promotions, private label ranges, and loyalty schemes. They are focusing on communicating local and seasonal credentials and finding efficiencies in their channels. Premium, sustainable packaging solutions are crucial in this context. They can drive supply chain efficiencies, offering cost benefits and environmental advantages. Automation, for instance, offers significant cost savings in both online and traditional shopping channels.

Don't Lose Sight of Sustainability

Sustainability remains a paramount concern. With 62% of people trying to buy environmentally friendly packaging, but 45% struggling due to financial constraints, businesses must continue to prioritise sustainable practices. Retailers are striving to meet ambitious ESG targets amid stricter packaging regulations.

DS Smith’s approach includes plastic reduction and recycling initiatives. Our Lift Up solution for carrying large bottles, which saves energy and reduces CO2 emissions, is a testament to our commitment. Collaborating with companies like Coca-Cola, we're replacing plastic shrink wraps with more sustainable alternatives.

Furthermore, our partnership with Nafici Environmental Research (NER) is exploring 'second harvest' materials. This initiative aims to transform agricultural waste into paper-making pulp, potentially saving up to 10% of the virgin fibres used in papermaking. This innovative approach presents a viable alternative to traditional sources, underlining our commitment to sustainable packaging solutions.

In conclusion, as we navigate through 2024, the packaging industry must remain agile, innovative, and responsive to the evolving needs of consumers and the planet. At DS Smith, we are committed to leading this charge, ensuring that our packaging solutions meet the demands of today while paving the way for a more sustainable tomorrow. Whilst consumer preferences and customer demands evolve over time, our teams’ resolute focus on driving innovation is a timeless trend and remains at the forefront of our business for 2024 and beyond.