Sometimes taking someone’s word for it just isn’t enough. We need to see and experience things for ourselves in order to believe in them.
Customers feel this way, which is why they are demanding more windows into the supply chain process, so that they can better understand the provenance of their purchases.
Supply chain transparency is inherently valuable. It boosts consumers’ trust in the products they purchase – particularly in today’s post-COVID landscape, where there’s heightened emphasis on the integrity and healthful nature of food and drink, as well as increased pressure on companies to evidence sustainable growing and manufacturing practices and ethical factory conditions for workers.
Better transparency also has the potential to usher in a new era of collaboration, bring much-needed calm to the volatile markets and mitigating negative impacts on brands. A survey from The Economist Intelligence Unit which sought to determine the true cost of supply chain disruption in 2020, revealed that supply interruptions had caused reputational damage to the brand in 38% of cases. Loss of regular customers, loss of productivity, and increased complaints were further problems caused when complex and just-in-time supply chains were put to the test.
So when did companies experience the most fallout, ie the highest incident of reputational damage and complaints? This occurred when businesses committed to timelines and orders but could not ultimately fulfil them, and in times of pervasive uncertainty. This suggests that a greater level of supply chain transparency, with real-time insights and better predictions, could have gone a long way to minimising negative associations with the brand.
Tracking supply chains has become a matter of consumer interest, rather than a strictly operational concern. At the end user level, supply is now in your customer’s consciousness, with store patrons being confronted by low stock and empty shelves, often coinciding with lockdowns. Consumers are increasingly sensitive and aware of the complex, global nature of supply chains as well as the potential for interruptions – and this can have an outsized impact on the feelings customers have towards your brand.
Avoiding risk of reputational damage is one reason that many brands are spending significantly to embed a culture of transparency, underpinned by advanced tech solutions.
No longer just about the immediate suppliers, thorough supply chain due diligence requires companies to investigate further down the supply chain – and this is becoming a core part of their missions and external messaging.
A “nerve centre” approach with transparent, cross-functional collaboration, says global consultants McKinsey, can help to solve supply chain conundrums swiftly, and support seamless provision of goods. In future, they argue, joining up the supply chain teams with those in procurement and operations, will be equally as important as breaking down data silos and employing next generation operating models and AI-enabled technology to improve supply chain agility.
Amid these considerations, the packfront should not escape brand’s attention. Packfronts aren’t just the primary physical touchpoint of a brand, they are the first port of call when it comes to communicating with customers – as well as a key tool in “smart” inventory tracking.
Packfronts are often the home of numerous badges, certifications, seals and codes. As pack designers we know only too well how packfronts can quickly become overloaded by trappings of authenticity which, used en masse, inadvertently undermine the consumer’s overall sense of trust.
An easy-to-understand and uncluttered design architecture is essential to enable effective information sharing, in ways that won’t take away from the shelf impact or appeal. This is a vital consideration if packaging is to fulfil its potential, not just as your brand’s biggest statement, but also as a doorway to more information accessed via a barcode system and the customer’s smartphone app.
One such data-driven solution uses Blockchain, which experts argue is on the cusp of widespread adoption. Blockchain technology allows each body in the supply chain to log data points into a shared ledger, enabling food producers and retailers to operate transparently. Platforms such as IBM Food Trust provide a vehicle for multiple stakeholders to collaborate in real time.
In this way customers will soon be able to authenticate brand claims – and those packfront badges and certifications – with a simple scan using their mobile phone.
Of course, just because the technology is there doesn’t mean that consumers will have the motivation and technological know-how to make it part of their day-to-day routines straight away. After all, QR codes have been around for more than 20 years, but it took a pandemic to bring about widespread usage. As with anything, there are barriers to overcome, such as a skills gap and lower levels of confidence in using smartphone technology – particularly among older customers.
Once adoption is widespread, however, the integration of technology like blockchain would help to build confidence that the label on the product authentically communicates the attributes found within.
As we know, technology is never a panacea, and no system can totally replace the need for good “old fashioned” pack design. Impactful design and consistency across ranges matter as much as they ever did – if not even more.
Feelings of trust and authenticity should be supported by on-point product photography, POS messaging and well-thought-out marketing.
If experts are right, and digitally enabled tracking systems will soon become ubiquitous, then the design of your packaging will work in tandem with this technology. Ideally, your product should look and feel authentic, both online and to the touch – with the supply chain data to back it up. Ultimately this will give your brand a competitive advantage.
Looking forward it’s clear that brands will have much to do – both in developing both their packfronts, and in building transparency in their supply chains, if they want to keep up with consumer demand.
You can take our word for it.