Setting the Stage for Digital Packaging's Future
The third annual Digital Packaging Summit kicked off on Monday night with a keynote presentation that addressed the impact digital will have across the four varying packaging segments. David Walsh and Jennifer Dochstader, co-owners of LPC, Inc., a market research and technical PR firm, and the co-chairs of the Digital Packaging Summit, outlined the state of the industry in each packaging segment, the key concerns of brand owners, and assigned a “mantra” for each segment’s future as it pertains to digital printing.
To begin the presentation, Dochstader provided a glimpse at the packaging industry by the numbers. Citing U.S. statistics from 2016, Dochstader explained that in terms of printed packaging revenue, the packaging segments from smallest to largest are labels ($10.2 billion), folding cartons ($11.4 billion), flexible packaging ($23.5 billion) and corrugated ($28.6 billion).
However, despite its ranking as the lowest revenue generator overall in printed packaging, there are significantly more label printers in the U.S. than any other segment across packaging, with a total of approximately 2,200. Meanwhile corrugated accounts for 1,250 converters, folding carton has 460 converters and flexible packaging has 420 converters.
Dochstader explained that while each of the packaging segments is growing, flexible packaging is seeing the fastest growth rates, at 3.4% annually.
“Flexible packaging is really the star right now,” she said.
With growth across all packaging segments, Dochstader outlined what some of the key drivers are in the rise of digital printing. One of the main drivers for digital comes from what she referred to as “craft or cottage industries.” This doesn’t solely include craft breweries and distilleries, which are both booming, but also includes luxury chocolate brands, among other boutique items.
“Craft and cottage industries are a growing market in the U.S. and one that converters are profiting from,” Dochstader said.
While packaging segments are growing, Walsh and Dochstader discussed that it is important to understand what the issues are that “keep brand owners up at night.” Walsh mentioned that consumers are demonstrating a decrease in brand loyalty, which has led brands to look at creative ways they can maintain their connection with consumers.
Another important issue for brand owners that Dochstader detailed is the rapid rate at which packaging now becomes obsolete. With how quickly brands become subjected to new promotions, marketing initiatives and compliance standards, this can lead to a decrease in shelf life for packages.
“Rolls and sheets of printed packaging sitting on shelves are becoming obsolete due to new promotions, marketing driven changes and/or new compliance standards,” she said.
To help set the stage for the direction of each packaging segment’s digital future, Walsh and Dochstader assigned a “mantra” for the label, flexible packaging, folding carton and corrugated segments.
In the label segment, the mantra was “To Replace.” Dochstader explained that the label segment has the highest adoption rates and longest history in digital, with approximately 10% of labels printed in the United States being produced digitally.
“In 2017, digital label production is moving from complementary technology to a replacement technology,” she said.
The mantra for flexible packaging was “To Prove.” There are few digital printing options available in flexible packaging, and Dochstader explained that flexible packaging converters have specific areas of concern when it comes to digital printing on their applications. The top three she outlined are:
- Existing digital press speeds and widths
- Ink fitness of digital inks
- Opaque whites on films
The folding carton mantra was “To Promote.” This, Dochstader explained, is because promotions, particularly in food and cosmetics are becoming a growing opportunity in folding cartons. As the prevalence of short runs continues to grow, she states that folding carton converters report turning away five or six jobs per month due to run sizes being below a minimum run size threshold of 2,000 sheets.
The mantra for the corrugated segment was “To Bridge.” Dochstader explained that digital printing provides a bridge between flexo and litho printing that offers low-waste. She states that with digital, converters can also develop a bridge between marketing departments’ “wish lists” and the “realities of economics.”
With three days to dive into the digital possibilities across the packaging spectrum, Walsh and Dochstader stated that the Digital Packaging Summit provides a rare opportunity to have converters from all segments together at one event to learn from each other.
“It’s the perfect time to come together in a meeting such as this,” Dochstader said.