The future of e-commerce and packaging machinery
Our lives have changed significantly as we adjust to the new normal following the height of the pandemic. One of the many new behaviors that we incorporated into our everyday routine was an increase in online shopping. E-commerce has continued to surge since then, with online sales projected to increase from $5.7 trillion in 2022 to $8.1 trillion in 2026.1 Young consumers continue to shape the mobile shopping landscape, with 53% of all teens making online purchases primarily with their smartphone.2 For this generation of consumers, social media plays a large role in driving trends and influencing purchasing behaviors, something that companies continue to respond to – 41% of brands plan to increase investment in paid and organic search.3
While many retailers have benefitted greatly from the acceleration of e-commerce, the pace of growth hasn’t come without its costs. Retailers had to adapt quickly to meet the new demands, putting efficiency and profitability on the back burner in favor of fulfillment solutions that met shoppers’ needs at that moment. With e-commerce claiming a bigger piece of the retail pie today, retailers are now shifting to capital investments to turn this sales growth into profitable growth.
Say packaging that conveys the brand cares about sustainability impacts their online purchase decision
Are likely to engage with packaging that connects them to digital product information, offers, and/or experiences
The Future of Retail
Vice President, Retail Insights and Solutions
As we look to the future of retail, we see two consumer dynamics emerging from the pandemic. “Shoppers are of two minds,” explains Leon Nicholas, vice president, Retail Insights and Solutions at WestRock. “On the one hand, they are planning purchase occasions with caution and purpose. At the same time, they are prioritizing convenience on their terms. Optionality for shoppers is the future of packaging, and the expectation that retailers will provide an array of convenient fulfillment options is here to stay.”
While they weigh shopper behaviors, retailers are adjusting to the new operational reality– e-commerce, driven by more localized fulfillment options, is driving growth and will dictate the terms for all commerce in the years ahead.
Another reality retailers are seeing is the effects the economy and current supply chain issues have had on consumer behaviors. For online shoppers in 2022, their approach to purchasing packaged goods was price-driven 32% of the time, compared to only 20% back in 2020). 4
As retailers look to sustain the growth of e-commerce in a profitable manner, we see the greatest investments in e-fulfillment across inventory deployment, labor and layout optimization, and especially automation. This emphasis on automation will drive packaging and supply chain ecosystem management strategies – critical areas for manufacturer alignment.
Our machinery creates on-demand or right-sized packaging, reducing materials, void fill and dimensional weights and packaging waste, all of which can lower shipping, labor and raw material costs.
- Box On Demand® systems give customers the flexibility to create perfectly sized boxes for highly variable or odd-shaped items, in house and on demand.
- Pak On Demand™ Pouch System provides a sustainable alternative to plastic mailers. The system creates a lightweight, curbside recyclable pouch on demand and seals the package for shipment—all with a single operator.
- BoxSizer® offers customers a way to continuously right size different packaging footprints by measuring the empty volume of the box, cutting, folding, and sealing each single or multi-item order.
“The accelerated transition to e-commerce drove retailers to innovate rapidly in 2020,” says Nicholas. “As we look ahead, we are partnering with our customers to translate this surging demand into profitable growth with automation, packaging, insights and fulfillment solutions that enable retailers to innovate boldly and package sustainably.”
In the years ahead, e-fulfillment investments will continue to be a strategic priority across the industry, with an emphasis on packaging machinery and supply chain management. To learn more about how WestRock can help you succeed in retail’s fast-paced world, click below