Steve Katz, Contributing Editor11.14.22
You’d be hard-pressed to identify a label and packaging market more competitive than the beverage sector. Scanning the shelves of the myriad shops that sell drinks – convenience stores, gas stations, supermarkets, pharmacies, etc. – your eyes are met with an explosion of colors, logos and taglines from the biggest brand owners in the world. Selling beverages is serious business, and labels play a pivotal role in a brand’s success or failure.
According to a recent report from Vantage Market Research titled Beverage Packaging Market, the growing demand for sustainable and convenient packaging for beverages and increased innovation in the packaging of beverages are some of the factors fueling market growth. The global beverage packaging market was valued at $145.91 billion in 2021, according to the report, and is expected to achieve revenue of $193.22 billion by 2028.
When it comes to drinking and packaging, libations get a lot of attention, and it’s well-deserved. We often hear about wine labels being called “works of art.” But since wine, spirits and craft beer labels have carved out their own unique markets exclusive to them, let’s take the opportunity to examine the intricacies and latest trends affecting temperance – or non-alcoholic – drinks and their associated labels and packaging.
Vantage Market Research reports that growth of the greater beverage packaging market is anticipated due in part to the rising consumption of several types of beverages, notably drinks that are deemed healthy and nutritious. The firm notes the “health is the first priority” mantra is currently top-of-mind in the value hierarchy of consumers as compared to the past.
“Due to the awareness of healthy beverages, consumers are now becoming more experimental and trying the new healthier options or drinks – especially the drinks with essential ingredients such as vitamins and nutrients,” the firm reports, noting that more and more brand owners are exploring innovation and consumer-friendly packaging to attract more customers and increase sales.
Vanita Marzette, senior product manager, Avery Dennison Label and Packaging Materials, notes that functional beverages – beverages that promise and deliver on positive functional outcomes or feelings beyond offering simple refreshment – are creating more value in the industry.
“Consumers want drinks that satisfy a particular need beyond simple refreshment. Sales of immune support beverages and supplements fortified with essential micronutrients remain strong. Higher caffeine content energy drinks and isotonic beverages (particularly reduced-sugar sports drink brands) have also been top performers,” she says, adding, “New and emerging functional drinks, like prebiotic tonics fortified with fiber and adaptogen-powered ‘relaxation beverages,’ are a small but similarly vibrant area of new product development in the US, led by premium-priced independent brands.”
In addition to the growing desire for improved consumer health and longevity, demands for eco-friendly beverage packaging solutions have emerged as significant market drivers, a sentiment echoed by material suppliers to the label industry.
“Brands are pushing for sustainable materials and then are highlighting these sustainability efforts in the brands’ label design. We are also seeing more brands launch products with plant-based or natural ingredients. Our AD CleanFlake film portfolio helps beverage brands stand out on the shelf, all while enabling recycling for PET and HDPE bottles,” Marzette says.
Dan Riendeau, strategic business unit manager, packaging, FLEXcon, stresses that one of the most notable trends in the sector is the push for enabling the recyclability of PET containers. He says, “Sustainability continues to be a huge push, and with brands setting ambitious sustainability goals for 2025, enabling recyclability is one trend that is not going away. The need for packaging that uses recycled content or that produces less material waste is driven by the consumer.”
According to Earth Day organizers, 7.7 billion plastic water bottles are sold in the UK every 12 months; and according to Grandview Research, 50 billion water bottles are sold in the US over the same period of time.
“Within the US and UK alone, this translates to 300 million tons of plastic waste,” Riendau points out. In response, he says, FLEXcon recently launched its optiFLEX THIN ecoFOCUS product line. “This product line features downgauged versions of our traditional optiFLEX ecoFOCUS products that support the recycling process with comparable performance. In addition to reducing the amount of plastic in the label, other benefits include: cost savings when it comes to shipping, more labels per roll, which results in fewer changeovers, and superior on-press performance and dispensability,” Riendau says.
This product line from FLEXcon includes 1.6 mil BOPP films; 2.2 mil PE films; TRACrite 92 release liner made from up to 60% post-industrial recycled content; and V-52RE wash-off adhesive, which adheres well to PET containers and removes cleanly during the PET reclaim process. Also, V-127RE adhesive adheres well to HDPE containers and is compatible with the HDPE reclaim process.
Patrick Park, business development manager, UPM Raflatac Americas, also emphasizes a greater awareness from consumers regarding recyclability of containers. “This drives the use of label options that would be seen as more helpful in the process to achieve a circular economy. UPM’s wash-off adhesive RW85C, paired with a polypropylene label face, allows for cleaner PET recycling and separation of materials in the washing and sorting process,” says Park.
UPM Raflatac offers many options and steps promoting sustainability. “Along with our RW85C wash-off adhesive, we also offer sustainable facestocks that are bio-based or produced using mass balance that we can provide an impact analysis on to show brands what impact that change has in ‘closing the loop.’ Also, our RafCycle program continues to grow in the US, where we pick up release liners and reuse them in future production runs, also contributing to future liner supply. As an alternative to virgin paper or filmic release liner, this allows for continued reuse and will also push circularity in labels.”
The right label and packaging campaign can be an instrumental marketing tool. For an example, look no further than the wildly successful “Share a Coke” campaign that launched in Australia in 2011 and would go on to have a strong marketing impact around the globe. In essence, the campaign involved the “debranding” of the traditional Coke logo, replacing “Coca-Cola” from one side of a bottle with the phrase “Share a Coke with” followed by a person’s first name.
Australian advertising firm Ogilvy estimated that the campaign increased Coke’s share of the category by 4% and increased consumption by young adults by 7%. Meanwhile, in the US, the campaign is credited with increasing sales by more than 2%, and at the same time reversing more than 10 years of decline in Coke consumption.
Share A Coke was also a massive social media success. Not only did #shareacoke become a No. 1 globally trending topic, it also led to Coke gaining more than 25 million Facebook followers.
The Share A Coke campaign has been lauded by financial and advertising analysts as a reminder to marketers of the need for personalization, a strategy that’s proven to attract the lucrative Millennial demographic.
HP Indigo digital print technology is credited with being a significant factor in Share A Coke’s success. Digital printing and personalization go hand-in-hand, and both continue to trend upward in the beverage labeling space.
There are other trends of note, as well. FLEXcon’s Riendau says the no-label look is still a popular format. “Glass bottles or plastic achieve a premium no-label look with clear film labels that blend into the glass,” he says, adding, “Other labeling techniques that draw attention are those that achieve reliable optical clarity, where labels stay clear no matter how much moisture they encounter, thanks to adhesives that do not whiten in water. Also, beverage packaging can stand out in terms of decoration and design by utilizing metalized or specialty films for a premium look.”
From a product standpoint, as previously mentioned, “healthier” beverages are in, and they go beyond functional and nutrient-rich drinks. Marzette says, “Flavored sparkling water continues to attract consumers from more sugary beverage sectors. In the US, 71% of sparkling water users say it is a good alternative to soda.”
Marzette also points toward a home-focused trend. She explains, “In-home beats out-of-home. Consumers want products that enhance their experience at home – beverages offering flavors and experiences they once got outside the home at restaurants and other similar places. Brands should continue to develop product offerings and buying channels that align with a home-first lifestyle. Convenience is also a driver, with there being a rise in demand for smaller packaging sizes adorned with labels/adhesives with mandrel performance.”
A move away from traditional glass or plastic bottles is another trend, and one that relates to both sustainability and supply chain considerations. UPM Raflatac’s Park explains, “We see new products that are using aluminum, Tetra Paks, and other alternatives to PET bottles or glass. We suspect this is due to the difficulty in securing consistent supply of traditional containers coming out of the current supply chain challenges. Some of these packages are also designed for consumers to ‘drop in curb pick up bin’ to encourage recycling.”
Matt Francklow, managing director at Creation, explains, “Despite much of the dust settling on a tumultuous period, we’re still looking at a volatile retail market; supply chain disruption is easing but we’re now seeing record inflation affecting businesses of every size. This is pushing up costs, which cannot easily be absorbed and tends to force price increases downstream. In terms of both design and production, we are expecting to see several trends surging to the forefront in the label category.
“In terms of design language and aesthetics for new labels, the trend for minimalism is set to continue, very much in line with the trend of ‘mindful design’ that aims to instill a sense of calm in consumers. Where brighter, almost graffiti-inspired design and color blocking have risen to prominence, we now see bold simplicity and clean lines. Designers are keeping it soft, sleek and chic.
“This is connected to the growing drive for label premiumization. The design techniques that we see so often in the high value beverage sector are filtering out to more product categories. After a difficult couple of years, I think we’re all looking for a bit of escape and a touch of luxury in the ‘everyday,’ and brands are responding to this. As a result, we are also likely to see more attention on tactile premium finishing that captures the eye on-shelf and turns handling into an experience such as UV inks, embossing and hot and cold foiling. Premium finishes have been climbing in usage lately, but 2023 could be a particularly strong year in this field.”
Creation helps its printing customers deliver more for their brand partners and believes that the recent supply chain challenges could result in a more robust industry. Francklow concludes, “With mounting pressures, 2023 will be a real test of which label printers can make optimal use of resources and control the bottom line, without sacrificing key areas such as sustainability…It feels like a lot for label printers to juggle – quality must be exemplary, but we also look for efficiency and precision over high volume runs while also having the agility to accomplish short runs. To distill what we believe will shape the market through 2023, it’s all about achieving more with less.”
Plastic straws are banned or in the process of being phased out in several parts of the world. There have been some quality challenges with the current paper straw alternatives on the market as they tend to get soggy in hot drinks, making them not only unpleasant to use but also dangerous for children.
The Finnish startup Dolea has developed a recyclable and durable fiber-based straw that uses 25% less material and stays intact in all sorts of drinks, including hot beverages. Dolea has developed a proprietary machine technology for producing the straws in an efficient manner that also enables the manufacturing of printed straws based on end customers’ design.
Walki’s new startup investment initiative, Walki Ventures, has invested in Dolea and as a part of the arrangement, Dolea’s machines will be relocated to Walki’s plant in Ylöjärvi, and new production capacity will be installed in Walki’s Garstang plant in the UK during the autumn 2022. Walki will also sell the straws in the UK under its own brand – WalkiStraw.
“As the straw is certified as paper according to PAP21, there is no need for special handling in the recycling process, meaning that the straws are fully recyclable. As the straw also has excellent printability, customers can brand their straws with logos and other graphics,” explains Dudley Jones, head of consumer sales at Walki. The market potential for fiber-based straws is huge, as over nine billion plastic straws have been used annually in the UK alone.
“As a pioneer in fiber-based materials, we are very excited to partner with Dolea. If the world is to succeed in moving away from plastic straws, we need recyclable fiber-based alternatives that are pleasant to use for consumers. Dolea has developed a way to make functional and recyclable straws, as well as the machines for manufacturing them. We are happy to contribute with the production,” says Jones.
“This is a strategic partnership that not only provides Dolea with the resources and capabilities to scale up to industrial level production, but a major step towards securing ability to deliver and meet customer demand that is growing by the day,” says Mika Salomäki, CEO of Dolea.
According to a recent report from Vantage Market Research titled Beverage Packaging Market, the growing demand for sustainable and convenient packaging for beverages and increased innovation in the packaging of beverages are some of the factors fueling market growth. The global beverage packaging market was valued at $145.91 billion in 2021, according to the report, and is expected to achieve revenue of $193.22 billion by 2028.
When it comes to drinking and packaging, libations get a lot of attention, and it’s well-deserved. We often hear about wine labels being called “works of art.” But since wine, spirits and craft beer labels have carved out their own unique markets exclusive to them, let’s take the opportunity to examine the intricacies and latest trends affecting temperance – or non-alcoholic – drinks and their associated labels and packaging.
Vantage Market Research reports that growth of the greater beverage packaging market is anticipated due in part to the rising consumption of several types of beverages, notably drinks that are deemed healthy and nutritious. The firm notes the “health is the first priority” mantra is currently top-of-mind in the value hierarchy of consumers as compared to the past.
“Due to the awareness of healthy beverages, consumers are now becoming more experimental and trying the new healthier options or drinks – especially the drinks with essential ingredients such as vitamins and nutrients,” the firm reports, noting that more and more brand owners are exploring innovation and consumer-friendly packaging to attract more customers and increase sales.
Vanita Marzette, senior product manager, Avery Dennison Label and Packaging Materials, notes that functional beverages – beverages that promise and deliver on positive functional outcomes or feelings beyond offering simple refreshment – are creating more value in the industry.
“Consumers want drinks that satisfy a particular need beyond simple refreshment. Sales of immune support beverages and supplements fortified with essential micronutrients remain strong. Higher caffeine content energy drinks and isotonic beverages (particularly reduced-sugar sports drink brands) have also been top performers,” she says, adding, “New and emerging functional drinks, like prebiotic tonics fortified with fiber and adaptogen-powered ‘relaxation beverages,’ are a small but similarly vibrant area of new product development in the US, led by premium-priced independent brands.”
In addition to the growing desire for improved consumer health and longevity, demands for eco-friendly beverage packaging solutions have emerged as significant market drivers, a sentiment echoed by material suppliers to the label industry.
Green means go – to market
According to Marzette, Avery Dennison is seeing – across all beverage segments – brands setting massive goals around recycling.“Brands are pushing for sustainable materials and then are highlighting these sustainability efforts in the brands’ label design. We are also seeing more brands launch products with plant-based or natural ingredients. Our AD CleanFlake film portfolio helps beverage brands stand out on the shelf, all while enabling recycling for PET and HDPE bottles,” Marzette says.
Dan Riendeau, strategic business unit manager, packaging, FLEXcon, stresses that one of the most notable trends in the sector is the push for enabling the recyclability of PET containers. He says, “Sustainability continues to be a huge push, and with brands setting ambitious sustainability goals for 2025, enabling recyclability is one trend that is not going away. The need for packaging that uses recycled content or that produces less material waste is driven by the consumer.”
According to Earth Day organizers, 7.7 billion plastic water bottles are sold in the UK every 12 months; and according to Grandview Research, 50 billion water bottles are sold in the US over the same period of time.
“Within the US and UK alone, this translates to 300 million tons of plastic waste,” Riendau points out. In response, he says, FLEXcon recently launched its optiFLEX THIN ecoFOCUS product line. “This product line features downgauged versions of our traditional optiFLEX ecoFOCUS products that support the recycling process with comparable performance. In addition to reducing the amount of plastic in the label, other benefits include: cost savings when it comes to shipping, more labels per roll, which results in fewer changeovers, and superior on-press performance and dispensability,” Riendau says.
This product line from FLEXcon includes 1.6 mil BOPP films; 2.2 mil PE films; TRACrite 92 release liner made from up to 60% post-industrial recycled content; and V-52RE wash-off adhesive, which adheres well to PET containers and removes cleanly during the PET reclaim process. Also, V-127RE adhesive adheres well to HDPE containers and is compatible with the HDPE reclaim process.
Patrick Park, business development manager, UPM Raflatac Americas, also emphasizes a greater awareness from consumers regarding recyclability of containers. “This drives the use of label options that would be seen as more helpful in the process to achieve a circular economy. UPM’s wash-off adhesive RW85C, paired with a polypropylene label face, allows for cleaner PET recycling and separation of materials in the washing and sorting process,” says Park.
UPM Raflatac offers many options and steps promoting sustainability. “Along with our RW85C wash-off adhesive, we also offer sustainable facestocks that are bio-based or produced using mass balance that we can provide an impact analysis on to show brands what impact that change has in ‘closing the loop.’ Also, our RafCycle program continues to grow in the US, where we pick up release liners and reuse them in future production runs, also contributing to future liner supply. As an alternative to virgin paper or filmic release liner, this allows for continued reuse and will also push circularity in labels.”
What’s popping (on shelf)?
A product label is typically the first interaction a consumer has when shopping in-store. The label is the face of a brand, and in the beverage space there are some very big brands.The right label and packaging campaign can be an instrumental marketing tool. For an example, look no further than the wildly successful “Share a Coke” campaign that launched in Australia in 2011 and would go on to have a strong marketing impact around the globe. In essence, the campaign involved the “debranding” of the traditional Coke logo, replacing “Coca-Cola” from one side of a bottle with the phrase “Share a Coke with” followed by a person’s first name.
Australian advertising firm Ogilvy estimated that the campaign increased Coke’s share of the category by 4% and increased consumption by young adults by 7%. Meanwhile, in the US, the campaign is credited with increasing sales by more than 2%, and at the same time reversing more than 10 years of decline in Coke consumption.
Share A Coke was also a massive social media success. Not only did #shareacoke become a No. 1 globally trending topic, it also led to Coke gaining more than 25 million Facebook followers.
The Share A Coke campaign has been lauded by financial and advertising analysts as a reminder to marketers of the need for personalization, a strategy that’s proven to attract the lucrative Millennial demographic.
HP Indigo digital print technology is credited with being a significant factor in Share A Coke’s success. Digital printing and personalization go hand-in-hand, and both continue to trend upward in the beverage labeling space.
There are other trends of note, as well. FLEXcon’s Riendau says the no-label look is still a popular format. “Glass bottles or plastic achieve a premium no-label look with clear film labels that blend into the glass,” he says, adding, “Other labeling techniques that draw attention are those that achieve reliable optical clarity, where labels stay clear no matter how much moisture they encounter, thanks to adhesives that do not whiten in water. Also, beverage packaging can stand out in terms of decoration and design by utilizing metalized or specialty films for a premium look.”
From a product standpoint, as previously mentioned, “healthier” beverages are in, and they go beyond functional and nutrient-rich drinks. Marzette says, “Flavored sparkling water continues to attract consumers from more sugary beverage sectors. In the US, 71% of sparkling water users say it is a good alternative to soda.”
Marzette also points toward a home-focused trend. She explains, “In-home beats out-of-home. Consumers want products that enhance their experience at home – beverages offering flavors and experiences they once got outside the home at restaurants and other similar places. Brands should continue to develop product offerings and buying channels that align with a home-first lifestyle. Convenience is also a driver, with there being a rise in demand for smaller packaging sizes adorned with labels/adhesives with mandrel performance.”
A move away from traditional glass or plastic bottles is another trend, and one that relates to both sustainability and supply chain considerations. UPM Raflatac’s Park explains, “We see new products that are using aluminum, Tetra Paks, and other alternatives to PET bottles or glass. We suspect this is due to the difficulty in securing consistent supply of traditional containers coming out of the current supply chain challenges. Some of these packages are also designed for consumers to ‘drop in curb pick up bin’ to encourage recycling.”
Beverage labels, lead the way
Creation Reprographics, a prepress and repro partner to label printers, has shared its perspective on the design trends expected to affect label design and printing through 2023, and the firm notes that the beverage sector is wielding its influence.Matt Francklow, managing director at Creation, explains, “Despite much of the dust settling on a tumultuous period, we’re still looking at a volatile retail market; supply chain disruption is easing but we’re now seeing record inflation affecting businesses of every size. This is pushing up costs, which cannot easily be absorbed and tends to force price increases downstream. In terms of both design and production, we are expecting to see several trends surging to the forefront in the label category.
“In terms of design language and aesthetics for new labels, the trend for minimalism is set to continue, very much in line with the trend of ‘mindful design’ that aims to instill a sense of calm in consumers. Where brighter, almost graffiti-inspired design and color blocking have risen to prominence, we now see bold simplicity and clean lines. Designers are keeping it soft, sleek and chic.
“This is connected to the growing drive for label premiumization. The design techniques that we see so often in the high value beverage sector are filtering out to more product categories. After a difficult couple of years, I think we’re all looking for a bit of escape and a touch of luxury in the ‘everyday,’ and brands are responding to this. As a result, we are also likely to see more attention on tactile premium finishing that captures the eye on-shelf and turns handling into an experience such as UV inks, embossing and hot and cold foiling. Premium finishes have been climbing in usage lately, but 2023 could be a particularly strong year in this field.”
Creation helps its printing customers deliver more for their brand partners and believes that the recent supply chain challenges could result in a more robust industry. Francklow concludes, “With mounting pressures, 2023 will be a real test of which label printers can make optimal use of resources and control the bottom line, without sacrificing key areas such as sustainability…It feels like a lot for label printers to juggle – quality must be exemplary, but we also look for efficiency and precision over high volume runs while also having the agility to accomplish short runs. To distill what we believe will shape the market through 2023, it’s all about achieving more with less.”
Plastic straws are banned or in the process of being phased out in several parts of the world. There have been some quality challenges with the current paper straw alternatives on the market as they tend to get soggy in hot drinks, making them not only unpleasant to use but also dangerous for children.
The Finnish startup Dolea has developed a recyclable and durable fiber-based straw that uses 25% less material and stays intact in all sorts of drinks, including hot beverages. Dolea has developed a proprietary machine technology for producing the straws in an efficient manner that also enables the manufacturing of printed straws based on end customers’ design.
Walki’s new startup investment initiative, Walki Ventures, has invested in Dolea and as a part of the arrangement, Dolea’s machines will be relocated to Walki’s plant in Ylöjärvi, and new production capacity will be installed in Walki’s Garstang plant in the UK during the autumn 2022. Walki will also sell the straws in the UK under its own brand – WalkiStraw.
“As the straw is certified as paper according to PAP21, there is no need for special handling in the recycling process, meaning that the straws are fully recyclable. As the straw also has excellent printability, customers can brand their straws with logos and other graphics,” explains Dudley Jones, head of consumer sales at Walki. The market potential for fiber-based straws is huge, as over nine billion plastic straws have been used annually in the UK alone.
“As a pioneer in fiber-based materials, we are very excited to partner with Dolea. If the world is to succeed in moving away from plastic straws, we need recyclable fiber-based alternatives that are pleasant to use for consumers. Dolea has developed a way to make functional and recyclable straws, as well as the machines for manufacturing them. We are happy to contribute with the production,” says Jones.
“This is a strategic partnership that not only provides Dolea with the resources and capabilities to scale up to industrial level production, but a major step towards securing ability to deliver and meet customer demand that is growing by the day,” says Mika Salomäki, CEO of Dolea.