Active packaging is witnessing a continuous increase in adoption by customers in order to preserve the quality and shelf life of products like foods, beauty and personal care products, and beverages among others. Active packaging makes use of some chemicals or reagents, which are either incorporated into the material or in the packaging solution, to maintain the quality of contents. Although this is what all packaging solutions do i.e. offer protection to the contents, active packaging solutions add another layer of safety and reliability to the contents in the package. These add to the overall shelf life of packaged contents by offering required favourable environment to them and also enhance the quality of contents.
The active packaging solutions market growth is partially attributed to robust growth of global cosmetics industry. Although cosmetics and personal care products are not new, and have been in use among people of nearly all age groups from a very long time, many countries are now emerging as lucrative markets for companies in this industry. Changing demographics, geopolitical and macroeconomic environment across such countries is promoting the surge in sales of cosmetics products, thus widening doors to immense growth opportunities. The Kingdom of Saudi Arabia (KSA), for instance, is an economy in the Middle East and this economy had, for long, remained an underperformer in the global cosmetics landscape on account of stringent and orthodox laws which had been in place and had been keeping the country’s cosmetics and personal care sector from growing to its real potential. But, changes in this environment in this country have brought about a significant change in the performance of many industries including cosmetics and personal care. Continuous increase in the number of working women in the Kingdom of Saudi Arabia is transforming the industry’s scenario in the country. The figure given below shows the growth trend in the number of working women in Saudi Arabia:
% of Wage and Salaried Workers, Female (% of Female Employment)
Source: The World Bank Group
Since working women can spend freely, as they have their own income to spend from, sales of cosmetics and personal care products in this country have been witnessing a solid increase. This is a result of coming into force of a good number of social reforms by the crown prince of Saudi Arabia, as the prince seeks to curb the influence of conservative people on women’s lifestyle in the country, which for, long had remained very restricted. This has been instrumental in driving the growth of this sector in Saudi Arabia. Many cosmetics manufacturers, based both within and outside the country, have been channelling investments in this sector in this country in order to harness the huge untapped potential by it. As these investments continue to flow into the production of cosmetics and personal care products in this country, the demand for advanced and more innovative packaging solutions is also growing. While this is just one example of an economy in the Middle East, a broader picture would show changes like these taking place across many other economies worldwide. Such economies, which had been witnessing a limited growth in this sector for a fairly long time, are now being seen breaking the shackles and showing good growth. Amidst this, since enhancing the quality and shelf life of these products is becoming one of the key focal points for manufacturers who seek to retain customers, adoption of active packaging is increasing among them, thus propelling the market growth.
The active packaging market growth is also being spurred by growing adoption of active packaging solutions across food and beverage industry. North America and Europe are seen as the early adopters of new technologies. High degree of awareness among people in these regions regarding the adverse effects of some packaging types on health has led many companies, including fresh and processed food manufacturers, to adopt active packaging in order to offer highest levels of reliability to customers. Interestingly, the demand for active packaging is not confined to these two regions as other regions are also coming up as lucrative markets for market players. Asia Pacific, for instance, has also emerged as a key market for active packaging in the food and beverage sector. Here, the demand for this type of packaging in this sector is being driven by increasing focus of people in many countries on health. For instance, Japan, which is one of the most developed economies worldwide, is not just known for its contribution in the global economic growth, but it is also known for the focus of people in this country on healthy lifestyle. This is evident from the fact that the country is witnessing a robust increase in the output of organic food. This is mainly due to rising focus of people on healthy foods. The figure given below shows increase in production of organic foods in Japan from 2005 to 2015:
Domestic Production of Organic Food (Plant, Non-Processed), 2005-2015, Metric Tons
Source: Japanese Ministry of Agriculture, Forestry and Fisheries (MAFF)
This increase in the production of organic foods in Japan is driving with it the demand for innovative packaging solutions which can supplement these foods by preserving their nutritional value, thus contributing to the growth of active packaging market.
The market growth is expected to remain solid over the medium and long term. Although the continuous increase in the spread of COVID-19 pandemic has impacted the growth of many sectors, some sectors like pharmaceuticals will continue to support the market growth. As people are becoming more concerned about the type of packaging products are coming in, on account of high risks of infection spread associated with some packaging types, adoption of active packaging is expected to remain good till 2025.
ABOUT THE AUTHOR:
Anjali Joshi is a senior market research analyst at Knowledge Sourcing Intelligence. She oversees a team of analysts and is known for the quality of market intelligence she delivers to the clients which range from start-ups and Non-profit Organizations to Fortune 500 companies. Anjali’s keen understanding of international business and market dynamics, coupled with her years of experience working in this industry, allows her to analyse current and future trends across both global and clients’ target markets and help them in making informed decisions.