In an industry typically defined by traditionalism and consistency, smart technology is poised for a major breakthrough. The rapidly-changing capabilities of smart labels were a hot topic at the TLMI 2015 Technical Conference on September 2, 2015, as industry experts gathered to examine changes that have already occurred and others that might be on the horizon.
 
Colleen Twomey, assistant professor at Cal Poly State University, Tim McDonough, president and CEO at Flexo-Graphics, and Kurt Hudson, global director of digital printing at Actega, participated in presentations and a panel discussion on “Interactive Labels: Are You Immune to Kryptonite?” The three speakers highlighted different aspects of smart technology, including the presence of NFC, Bluetooth, augmented reality and printed electronics. They explored how far the technology has come and how brands continue to improve on the QR reader.
 
“NFC can be used as card emulation, so I can conduct commerce and transactions with the technology,” said Twomey. “I can pay for parking; I can purchase movie tickets from a poster that has an NFC tag.”
 
The packaging industry’s growth could also hasten smart technology’s implementation. According to Twomey, packaging ranks number one on the list of print’s fastest growing business segments. Over the next five years, the US packaging industry is expected to see 7.8% growth. By 2017, printed packaging will account for roughly 43% of print product sales across the globe.
 
Each presentation focused on a varying aspect of smart technology within the printed packaging industry. They are detailed as follows:
 
Smart Interaction
 
In her presentation titled “Trends in Interactive Packaging for Labels,” Twomey examined smart technology and the most popular resources for brand owners. She defined active packaging as packaging that does something, while smart packaging is something that operates reactively.
 
With smart phones seemingly everywhere, the possibility exists for more people to connect with packaging than ever before. Smart phones have been known to increase the information available to shoppers.
 
“We’re seeing three things come to the forefront that used to be nice to have that are now must-haves: immediacy, simplicity and context,” explained Twomey. “Using smart technology in high-traffic areas like museums, public events, grocery stores and the ability to do mobile POS pay is exciting.”
 
NFC technology creates a one-to-one relationship with a consumer. This technology is activated when an NFC-enabled device is touched to a product, within four inches but usually less. It works in close proximity, and is available for Android and iOS. NFC capability came to the forefront when Johnnie Walker and Thinfilm released the Blue Label bottle with OpenSense. Thinfilm’s proprietary solution tracks the open and closed state of the bottle, as well as other assorted product information.
 
Bluetooth, on the other hand, is categorized as a one-to-many platform. It is estimated that 250 million people have a smart phone with Bluetooth capability, where a transmitting beacon uses a distance around 150 feet to communicate with customers. The San Francisco Soup Co. and Nivea both have tracking options, with the former providing rewards, coupons and loyalty points.
 
“Printed electronics is creating functional components and products with printed technologies using conductive, insulating and optically-changing inks,” Twomey added. “There’s a lot of really good hype in our industry about printed electronics if we can capture the quality.”
 
The Millennial Advantage
 
McDonough looked at the packaging industry from the millennial’s point of view in a discussion titled, “Behind the Wheel: How Millennials are Driving the User Experience in Narrow Web Packaging.”
 
Millennials, by definition, were born between 1980-2000 and grew up with the Internet, Google and smart phones. According to McDonough, this is the largest generation in US history. This group is “obsessed with wellness,” and disposable income is typically earmarked for food, drink, fitness and fashion.
 
Since millennials value experiences, they are more drawn to smart packaging because it promotes touch, visuals and interaction. Inventory data ensures that what is desired is in stock, while customers can be informed about products before they know they want them. Time savings and waste management are also potential benefits of smart technology.
 
“Your packaging has to do something,” McDonough explained. “We talked about millennials and their obsession with apps. What you have to do is somehow draw them in via their phone, whether it’s the QR code, augmented reality or something else. You need to create an experience. Millennials value an experience, and all they want to do is tell their friends how cool it was so they go do it.”
 
A Technological Revolution
 
Hudson combined themes from the previous two presentations in “The Who Were Right. See Me, Touch Me, Feel Me.” He stated that technology is no longer a drawn-out process. Instead, it’s one that can occur seemingly overnight.
 
Hudson used the music industry to illustrate just how quickly change can take place. When compact discs hit the market in 1983, it took about four years before they ultimately outpaced vinyl records. With the advent of the iPod in 2001, it took just two years to gain more popularity than CDs in 2003. The iPhone subsequently replaced the iPod, taking just one year. Finally, apps like Spotify took just six months to make more of an impact, and that was in 2009.
 
Labels maintain properties that have visual, auditory and kinesthetic value. Smart labels have the potential to engage the customer in all three phases. The five senses are blended with electronics.
 
According to Hudson, smart labels provide “a satisfying, product-centric and buyer-centric experience.” With NFC packaging, smart chips are capable of storing and recording the actions of customers. It also limits the “showrooming” that is prevalent with the QR reader, where a consumer is given information about various retailers that could discourage purchasing in that specific store.
 
The next trend in smart packaging could be ultra-variable labeling. In this scenario, the smart device talks to the label and not the label to a smart device. Therefore, based on a customer’s purchasing history, he or she would be alerted to the fact that they haven’t bought a certain food or drink in an extended period of time. Hudson believes the packaging could even speak to the customer.
 
Ultra-variable labeling would feature personalization and hyper-localization. Global customer adoption will dictate just how quickly these technologies take form. As time goes on, there will be more standardization as smart labels become more accepted. In Hudson’s estimation, the brands will continue to pioneer this technology.
 
“This is the pace of change that we’re living in, and our labels will have the same kind of functionality that’s more and more powerful,” said Hudson. “This is not a presentation about what the answers are, this is a presentation about the fact that we need to pay attention to technology and understand what we’re dealing with as a human consumer. We need to find out how we tie those nifty gadgets into the tactician and sensory experience.”