3 Predictions for the CPG Industry in 2019
Published February 6, 2019
Over the past 12 months, as an industry, we have all learned and grown collectively. At INSITE, we’ve grown exponentially. 2018 was a big year for us. We added a new logo to our marketing portfolio and presented at a major trade show for the first time. In fact; we’re still recovering from that last one. Pack Expo 2018 was a whirlwind. We chose to use the event as an unveiling of sorts for us. We took the opportunity to fully display our products, technologies and business and interact with the greater consumer packaged goods (CPG) industry under the newly refreshed name of our somewhat young brand.
Now we’re looking to the future to see what the industry at large has in store for us. From now until the end of 2019, there will be any number of advancements or setbacks that end up affecting secondary packaging automation and the greater CPG industry. But nonetheless, here are our predictions for the CPG industry in 2019.
Online Ordering will Continue to Grow
The days of expecting consumers to venture to the store to purchase their favorite consumer packaged goods are dwindling. A recent Digital Readiness Assessment fielded by Nielsen and Food Marketing Institute (FMI) has brought some startling conclusions to light; those within the greater CPG industry need to be aware.
Back in 2016, it was predicted that online food retailing would reach its saturation point within the next 10 years. But 2017 showed this to not be the case any longer. With the digital boom of meal subscription and to-door delivery services, a new estimate has been crafted stating that market saturation will be a reality in as little as five years. Within those same five years, it has been forecasted that up to 70% of U.S. consumers will regularly purchase consumer packaged goods online.
With this influx of online ordering predicted to sweep the nation, secondary packaging manufactures, ourselves included, may see an increase in demand as more and more retailers and goods providers seek to match a growing order fulfillment demand.
Groceries Will Be one of the Largest, and Last, eCommerce Giants
As discussed above, online shopping is a trend that is here to stay. This shift in customer demand has been called the last great ecommerce wave by many industry experts. After Amazon acquired Whole Foods in 2017 for $13.7 billion dollars, the online retail giant’s grocery division became its strongest performer in 2018; followed by health, personal care and beauty, furniture and home furnishings, and apparel and accessories. The new division, Amazon Fresh, which brings fresh produce to consumers with the click of a mouse, is only predicted to see positive gains in the coming years.
Amazon is not alone in its pursuit of a digital-first grocery experience. Target, Walmart and Kroger have all rolled out grocery delivery services to try to claim a piece of the market’s current infatuation with online ordering for their fresh and shelf-stable goods.
Green Initiatives will Stay a Matter of Public Interest
10 years ago, if you had told the average consumer that a CPG manufacturer was now using a corrugated material composed of 20% recycled material, you would have received a blank look in return. In 2018 however, consumers put more pressure on the brands they love to embrace eco-friendly best practices. This is a trend that we see greatly impacting the 2019 marketplace.
We saw this trend reflected in Unilever’s recent acquisition of Equilibra as well as the unveiling or revamping of numerous green initiatives throughout the greater CPG industry. From Pepsico to Nestle, nearly every major player has made some kind of pledge to help reduce their footprint on our planet; and consumers are taking notice. When it became clear that plastic straws were drastically contributing to declining oceanic conditions, Starbucks was quick to adopt recyclable plastic lids for all of their cold beverages.
Many packing manufactures are now being forced to create machinery and processes that can handle the new, modern mediums needed to create more eco-friendly packaging. Secondary packaging manufacturers who think that the public’s reinvested interest in the state of our planet is a passing fad may soon find themselves in hot water as their clients demand machinery that is capable of handling a wider portfolio of materials.
Prepare for the Future with INSITE
Whether you’re planning for 2019 or 2091, at INSITE, we want to help. We’re passionate about helping our clients succeed through innovative secondary packaging automation solutions. Our machines are easy to use and ready to go right out of the box. Don’t get stuck wasting time trying to figure out a new floor full of overly complex machinery, give us a call today and get a jump on your future preparations.