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Exclusive Interview with Roger Zellner

Smithers Pira: What consumer, retail and e-commerce trends do you see emerging?

Roger Zellner: With regards to consumer trends, you’re seeing a lot of customization.  For example, products are becoming more tailored – you see this in cosmetics, beauty care, etc.  People and organizations are getting better at understanding what consumers like when customizing their offerings because there is so much more data.  Understanding your consumers at a more personal level will coincide with how well companies can manage their data and consumers trust to provide data.  

In the area of food where I come from, people are looking more and more to what helps meet their health and wellness needs.  Millennials and younger generations play better to small & medium sized companies who can provide what they care about. Many of the smaller organizations have the dream of getting bought up at some point by bigger companies, which is interesting and somewhat ironic.

I think brands and transparency will be fun to watch.  In the past brands have worked to portray an image or a persona in their marketing.  Now consumers are becoming more concerned with what’s in the product, what the product is made of, staying sustainable and more and are able to get data and reviews that may differ from marketing messages.

On another note, you are also seeing a lot of consolidation across the value chain.  For example, companies like Amazon, Whole Foods and Blue Apron have different packaging suppliers and design choices – people are looking to get scale and leverage moving forward.  Digital is also changing things in terms of printing capabilities.   The ability to print and package more precisely to individual desires  may allow better margins with smaller scale thru pricing to the consumer value experience.

As data becomes more available and transparent to consumers, the brands have to be much more aware and diligent and truthful.  The old days of mass marketing and the “Mad Men” type approach is shifting and changing every day thanks to things like social media and transparency.  I am taking a course at a local community college right now with a bunch of very diverse 18-25 year olds.  It is refreshing and humbling to interact with them and it’s made me more aware of how trends can change looking through the eyes of a younger consumer.

What will be powerful is that people with large sums of money to invest will want to target areas where these changes are occurring with packaging.  Making a profit is a powerful motivation and keeps people and companies on top of their game.

Smithers Pira: What disruptive, breakthrough and game changing technologies do you envision for the Future of Packaging?

Roger Zellner: Digital is disruptive – not only at the digital level, but also in terms of consumer interaction.  These days, people are able to get more transparency through product reviews.  They no longer need to go to the store, learn about the product there and purchase it.  They can read real reviews and purchase their product of choice at home.

Consequently, this changes the whole interaction experience between the brand and the consumer.  In the past, brands provided a high level of knowledge about their products.  Now people look at ratings before considering product marketing.  Think of movies and restaurants. This is becoming more and more relevant across the consumer realm and e-commerce is disrupting the whole distribution network.

The companies that design not only their distribution packaging but also their primary packaging to be cost effective within the e-commerce realm while delivering the consumer experience will be most successful.  These companies may not even be around yet.  I imagine these types of companies being startups that understand how the e-commerce value chain works all the way through – and design for that.  Now you see people adjusting their current retail product to fit into the e-commerce chain and make the same margins which is a struggle.

Smithers Pira: What are the strategic opportunities in high growth geographies?

Roger Zellner: I certainly see China as a country to watch – they are further ahead in many ways around e-commerce with penetration, Alibaba, the social networks (WeChat, etc.). I’ve often thought that the Chinese are surprisingly similar to the Americans in terms of how we do business and how consumers act versus many other non-Western countries.  In India, where distribution is such a challenge - technology will somehow play a role that will be different.  Health and wellness is continues to grow as an issue worldwide as well. How this plays out in different realms (physically, mentally, emotionally) will depend on family values, social circles etc. and should be taken into consideration especially with the data and transparency that is coming.

My perception with Latin America is that advertising resonates by having a lot more inclusion and family and an individual alone can be perceived, as something is wrong. Often commercials have many family and friends while I sense that US advertising can be more individualistic with more “me” time. It will be intriguing to watch how this plays out with e-commerce as brands and companies communicate thru social media.

Smithers Pira: What does the future regulatory landscape look like?

Roger Zellner: From my perspective, there are two opposing themes that seem to be happening around the world with populism and income inequality that will influence the regulatory environment. It seems the “us vs. them” theme is occurring at country and social levels everywhere and yet there are groups on social media that cross geographic and social boundaries.  As someone famous said “We live in interesting times” but there will be pressure to have both more and less regulations.

What is becoming an equalizer is the availability of data, transparency, understanding if you can believe what you read and uncovering what the truth may be.  There will be a greater and greater call to say “how can you make sure this doesn’t occur.”  With the recent school shootings, you see young people becoming energized and passionate about something to be done, to be addressed.  I believe the  “me too” movement would’ve never occurred in the past without social media. As these two forces emerge in society, it will create tension which will show up in pressure on governments and consequently reguations.

In the area of packaging, when people see it impacting their health or the health of the planet especially in their social media circles, you’ll see more of a push – there is a push for packaging to be clean, not toxic, not harmful, the consumer also wants to be reassured that  you eat in the package is “good”. But also people don’t want to be told what to do, to have the feeling of being controlled and not being independent which is also influencing the regulatory environment.

Smithers Pira: Why attend this event?

Roger Zellner: It will be a great collection of different viewpoints about the future of packaging and consequently, where the smart money could place their bets or investments. This audience is very different in terms of the investment bankers and private equity versus packaging professionals or business people who are taking things back to their company regarding opportunities or trends.  It will be more objective about what and where to invest for the future.  As they say, its about putting your money where your mouth is!

Smithers Pira: What are you looking forward to the most in the future?

Roger Zellner: From a packaging perspective, it is the impact how technology can be designed for individual situations and also change the end of life dynamics for packaging.  Imagine if every piece of packaging hasd the potential to be tracked and what that would mean for end of life responsibility.  People could understand the value packaging provides, where it’s been and how they can use it –people  could ask to buy and sell products in packaging came from oceans, etc!  Suddenly government and consumers are being told whose packaging is where – that may be decades if ever away but that would change dynamics.

Smithers Pira: What innovations would you like to see in the future of packaging?

Roger Zellner: Let’s take a different angle and look at it from a packaging equipment perspective in terms of innovation. As customization and personalization continue to advance, it would be sweet to have the flexibility to handle more materials or formats and customization on the fly.  People will take large sheets of raw unfinished packaging materials (cut form, print) within their own operations instead of having it done at converters.  At my original days at Oscar Mayer, we bought raw resin, and made plastic films right on the line for hot dogs and bologna. It was why Oscar Mayer become a national brand in the 1950’s and beyond.

I think that the education of more and more women around the world is going to have an impact in some way as well.  If senior leaders are older Anglo-Saxons, think of the future of a young Malaysian woman and how she may view the world and potentially run her part of the world whether in business or in personal life.  It’s a very different perspective these days and innovation will change as a result of different context and backgrounds.

Smithers Pira: Thoughts on flexible packaging?

Roger Zellner: Flexible packaging provides a great benefit for many products to be made and distributed successfully with a lot of consumer benefits, etc.  The huge Achilles heal is the end of life and the recovery of flexible packaging.  Because of flexible film’s cost effectiveness and consumer benefits, it will continue to be increasing part of the packaging environment but the end of life has to be addressed.