More companies are deploying augmented reality packaging to create immersive digital experiences for consumers. This form of packaging is projected to grow to a $510 million industry by 2030, according to a new report from global consulting firm Grandview Research. The 6.3% increase can be attributed to the North American market’s need for smart retail packaging.
Augmented reality (AR) packaging functions like traditional packaging but can be enhanced with artificial intelligence (AI) to boost consumer engagement, which is accomplished with visual markers like QR codes or 2D barcodes. Once scanned by a consumer’s smartphone camera, the package comes to life and displays interactive digital content such as promotions, virtual try-ons, and recipes.
Industries such as food and beverage, cosmetics, and pharmaceuticals have already implemented this user-friendly technology. While it’s becoming increasingly popular due to its engaging consumer features and sustainability benefits, there are also hurdles for companies, including cost and implementation.
Creating consumer experiences
AI-enabled AR packaging provides new ways for companies to engage with customers. That’s especially evident in online shopping, and industries like cosmetics, food and beverage, and pharmaceuticals.
First, when shoppers see products in an e-commerce setting, the sensory details of an in-person shopping experience are stripped away. By incorporating AR packaging’s digital tech, companies can deploy customer-rich experiences like immersive brand storytelling and demos to boost consumer engagement.
Additionally, the cosmetics industry uses AR to allow shoppers to try on makeup at home. A good example is L’Oréal’s Modiface, which utilizes AI to provide Amazon customers with AR capabilities.
In the food and beverage industry, which is reportedly the largest segment of AR packaging, consumers can scan labels to quickly access ingredient traceability, nutritional facts, allergen information, and even food prep instructions.
Several food and beverage companies are using this form of packaging, including well-known names like PepsiCo, the Coca-Cola Company, and Nestlé Confectionery, which have created the following campaigns around AR:
· PepsiCo: Deployed GS1 US’ 2D Digital Link on its Starry lemon-lime flavored soda, providing consumers with nutrition and sustainability information, loyalty rewards, and more. Also, the brand hosted a seasonal-themed virtual egg hunt for consumers to promote its soda collaboration with Peeps.
· The Coca-Cola Company: Produced a limited-edition Marvel Universe packaging campaign that featured famous heroes and villains from the series on bottles and cans. Animated user experiences for each character were made available via a scannable QR code.
· Nestlé Confectionery: Utilized QR codes on two of its brands, KitKat and Quality Street, to help shoppers who are living with sight loss to access product information more easily.
AR packaging is utilized in pharmaceuticals and healthcare for patient education and compliance monitoring. Patients can scan a medication and receive step-by-step dosage guidance, potential side effects, and video demonstrations, which can reduce the risk of medication errors.
Eco-friendly efforts
With stricter government environmental policies, businesses are turning to AR-enabled smart labels to replace traditional printed materials. This method reduces paper waste, improves recyclability, and educates consumers on eco-friendly practices.
Deployment difficulties
While AR packaging’s potential is immense, its adoption can be slowed due to high implementation costs and technological difficulties.
Developing AR-enabled packaging solutions requires a large investment in software development, 3D content creation, and cloud-based data management. These items can be expensive for some companies, especially small and medium-sized businesses.
The financial and time investment doesn’t end after AR packaging’s initial setup. Businesses must continuously update and maintain AR content to ensure relevance and engagement, which adds to the long-term costs.
Consumer dependency is another factor to consider regarding AR packaging’s effectiveness. It relies on consumer access to both smartphones and stable internet connections, which can limit packaging adoption in certain demographics and regions.
Driving adoption
In the United States, companies are integrating AR packaging into their marketing and branding efforts to drive consumer interaction.
AR packaging development is being accelerated by tech companies of all sizes, powered by AI, cloud computing, and 5G connectivity.
The report lists seven leading companies in the AR packaging market, including Vossle, SmartTek Solutions LLC, Zappar, and Brand XR. To view the full report, click here.
