Pour the electronic milk, turn off the IoT margarine
Smart packaging, in conversation with oliver wyman on the future of retail

Pour the electronic milk, turn off the IoT margarine

Smart packaging has moved out of the conceptual prototyping stage and connected products small enough to fit in our refrigerators are starting to become a reality. Could our cartons of milk finally be about to tell us when they are going off?

And if so, could all this connectivity lead to data privacy concerns about us as individuals? Internet of Business spoke to Nick Harrison, co-lead of global retail and consumer practice at management consultancy Oliver Wyman to get a view on the matter.

Harrison has said that it can be easy to get excited by the potential smart packaging and Augmented Reality may bring to the customer experience. This potential includes additional information on products, ‘pop out’ special offers, promotions or even ‘gamification’. But actually, the biggest impact of smart packaging will be its role in changing how we shop.

Read more: Spanish winemaker Barbadillo launches NFC-enabled smart bottles

Electronic milk, at last

“As an example, a smart fridge that knows your milk is going to go off shouldn’t just re-order milk. It should review what else you have that can be used in a recipe for that night’s meal and liaise with a smart hub to order anything that’s missing. Smart packaging makes this possible by ‘telling’ the fridge what’s in there, how much is left and how much life each product has.”

“This will be part of a broader trend towards AI enabled solutions which help customers manage their food needs in an intelligent way based on recipes, requirements, and requests, rather than just buying products on a list, as they do today,” said Harrison.

Pointing to the wider application of these technologies, Harrison suggests that authentication of products and their quality is another role smart packaging can play.

For example, color-changing smart packaging can indicate if a pack of chicken fillets has breached a temperature threshold during transit. With the reassurance smart packaging provides, retailers can shift to passive cooling methods – like ice packs – rather than refrigerated vans which are more expensive.

“This unlocks a whole new range of logistics providers, lowering cost and increasing delivery options. This is what we see happening in AmazonFresh’s partnership with DHL in Germany. It also could aid the introduction of passively cooled lockers outside homes so people don’t even have to be in to receive the delivery,” said Harrison.

Read more: WestRock, EVRYTHNG launch connected packaging solution

Smart packaging could extend to clothing labels

In clothing, a smart label could help you keep track of what items are in your wardrobe. This could plug into something like the Cladwell app – which learns your style and knows what type of items you already own – to help you choose new items that suit you but aren’t duplicative. Furthermore, says Harrison, smart labels on the clothes you do decide to buy can assure you they are authentic and provide transparency on how and where they were made.

Furthermore, says Harrison, smart labels on the clothes you do decide to buy can assure you they are authentic and provide transparency on how and where they were made.

With smart packaging and smart home devices, some consumers may have concerns about data protection. Especially with regards to those that automatically replenish. Oliver Wyman research suggests that 19 percent of Brits are the type of people who want to tell big companies to mind their own business and keep their hands off personal data.

“Another 12 percent regard technology as too complicated and changing too fast for them to keep up. With this third of consumers unlikely to welcome smart technologies into their homes anytime soon, companies touting smart tech have some work to do to convince them,” said Harrison.

Read more: Feeling the chill: Bringing IoT to cold chain logistics in retail

Don’t forget to turn off the IoT margarine

There are implications here. How much do we want these big manufacturers to know about us, our buying and shopping habits, our consumption habits and our home lifestyle habits?

The smart money on smart packaging points to connected IoT products that are opt-in, opt-out or ones that can at least be turned off at will.

“In addition,” says Harrison, “any business models these technology companies want to run based on the consumer insights the devices gather must be able to do so in a way that adheres to the General Data Protection Regulation (GDPR) coming into effect in May 2018. Under the GDPR, consumers will have full control over what data is shared and stored with a company and the ability to edit and delete it. They are only likely to give these permissions where they see real value in return.”

While we aren’t quite used to turning off our home products down to the level of packaged goods yet, we are already used to turning off our home camera monitoring systems and home heating control apps. This is just the next logical step, surely?

Oh… and turn off that loaf of bread while you’re up, if you could please?