19 Nov. 2020
Global value for e-commerce packaging will reach $113.5 billion by 2025
In the latest report from Smithers, the global value for e-commerce packaging is expected to reach $51.7 bn in 2020, as Covid lockdown and shop closures push more consumers online. This projection represents an increase of $14.0 bn compared to the $33.7 bn market of 2019.
In-depth analysis in the new Smithers study – The Future of E-commerce Packaging to 2025 – shows consumption will be around 40% higher in 2019. As consumer habits change, business models adapt and more retailers close physical stores; demand for e-commerce packaging will continue to boom through to 2025 at an accelerated compound annual growth rate (CAGR) of 17.0%. In 2025 this market will reach a value of $113.5 bn, over 10% of the total packaging market worldwide.
This makes e-commerce one of the most important and exciting market opportunities for packaging converters and material suppliers. Smithers exclusive market analysis sub-divides this segment by e-commerce packaging format (corrugated board; flexible paper, plastics, and foil packaging; mailers; protective components); end-use application, and geographic market.
All e-commerce formats will see double digit CAGRs through to 2025. Corrugated is the most valuable segment of the e-commerce packaging market. Value will rise from $30.0 bn in 2019 to $41.6 bn in 2020 and is forecast to more than double again by 2025 as it witnesses the fastest growth of all e-commerce formats.
The Smithers analysis identifies the following key changes in the market that will define future profitability for packaging suppliers and converters in e-commerce:
- In 2019, clothing, fashion accessories, and consumer electronics were already well established in e-commerce channels. In 2020 the market has expanded with high volumes of groceries, sports equipment, cosmetics and personal care items being shipped. This is prompting demand for new packaging solutions that can protect goods in shipment, and provide a connection to the at-home consumer;
- Covid-19 has broadened the consumer base using e-commerce, beyond millennials and digital natives to include more older age groups. Many will continue to use this sales channel even when lockdown (shelter-in-place) orders are withdrawn, fundamentally reshaping the retail landscape;
- A major value-adding service for packaging suppliers and converters are delivery formats that enhance consumer experience. This includes brand printed packaging; pre and post-ordering customised packs; and innovative designs that differentiate a product by giving it a unique ‘unboxing’ experience on delivery;
- Sustainability is also an important, if secondary consumer concern. This is prompting the use of more bespoke designs that eliminate unnecessary protective packaging, and new material concepts, such as fully pulp-based, easy-to-recycle mailers;
- Reliability, speed of delivery and hassle-free returns are leading priorities in online shopping; and will shape the design of specific e-commerce and omni-channel packaging in the future;
- Existing e-commerce trade is being supplemented by subscription platforms, more mobile-based sales, and even voice ordering via software like Alexa. This is forcing brands to reconsider packaging designs to appeal even when seen on a tablet or smartphone screen.
The impact of Covid-19 and these other trends is assessed critically in this new Smithers study, with an emphasis on how e-commerce is creating new market opportunities for packaging converters and suppliers. The historic, current and future market is quantified authoritatively in an exclusive market data set, with 250 data tables and figures.
The Future of E-commerce Packaging to 2025 is available to purchase now priced $6,500 (€5,250, £4,750). Orders placed before 30 November 2020 will receive a 10% discount.