E-commerce Packaging Market Growth Opportunities & Technology Developments by 2026

****** E-commerce Packaging Market – Insights

The e-commerce packaging market is bolstered by increasing e-commerce sales around the world. E-commerce has transformed retail sector and it is gaining significant market share in place of conventional retail channels such as hypermarkets, supermarkets, and convenience stores. The primary function of e-commerce packaging is to protect products from environmental damage and contamination such as dust, moisture, and microbes. Moreover, protection from damage is important for products such as electronics and furniture. E-commerce packaging is also important in terms of branding and customer retention. The use of sustainable and/or aesthetically appealing packaging material led to increased resale of products, according to a Stora Enso Oyj survey.

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Sustainable e-commerce packaging is gaining major traction since recent past. Chinese e-commerce players such as JD.com and Suning.com are adopting reusable plastic boxes, which is cost-effective and generates low waste. JD.com also announced that it aims to raise the proportion of sustainable materials to 80% of its total packaging material used by 2020, due to high waste generation from packaging. According to Chinese government sources, on Singles Day 2017, a popular Chinese holiday, over 160,000 tons of waste was generated as e-commerce players recorded sales of US$ 52 billion.

In terms of revenue, Asia Pacific held a dominant position in the market in 2016, and is expected to maintain its dominance throughout the forecast period. According to Associated Chambers of Commerce and Industry in India (ASSOCHAM), an industry trade association, the e-commerce market accounted for US$ 38.5 billion in 2017 and is projected to exceed US$ 50 billion by 2025. This can be attributed to an increasing internet penetration rate in India. According to the Internet and Mobile Association of India (IAMAI), the number of people with access to internet in India is projected to reach 500 million by June 2018. The aforementioned factors coupled with strong GDP growth and increasing purchasing power of consumers will result in India being the fastest growing market for e-commerce in the world, which in turn is expected to boost growth of the e-commerce packaging market in the region. Amazon India, Flipkart, and Snapdeal are among the major e-commerce players operating in India. The e-commerce packaging demand in India will largely be dictated by the performance of these companies in the market.

Europe and North America region have high internet and smartphone penetration. According to the World Bank, average rate of internet penetration in Europe and North America is 75% and 78% respectively. The market in these regions is driven by shifting consumer preference from offline retail channels to e-commerce. Amazon Inc. is the largest e-commerce player in North America. The company recorded a revenue of US$ 149 billion in 2016 in the U.S. alone and accounted for over 38% of the e-commerce market in the U.S. According to the Fibre Box Association (U.S.), the boxes segment is expected to witness significant demand from the e-commerce industry. This is largely due to increased demand for products such as furnishings, electronics, and consumer goods which typically utilize boxes as packaging.

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Among product type, protective packaging accounted for 33.23% of the market share and was valued at US$ 7.12 billion in 2017. It is expected to be the largest and the fastest growing segment throughout the forecast period. The segment’s dominance can be attributed to increasing electronics and food & beverages sales from online platforms.

The ****** e-commerce packaging market is marked by intense competition from major manufacturers operating in this market. Strategic mergers and acquisitions, product innovations, and joint ventures are some of the key strategies adopted by these companies to ensure long-term sustenance in the market. Some of the major players operating in the market are Smurfit Kappa Group, Mondi Group plc, International Paper Company, DS Smith plc, Klabin S.A., Rengo Co. Ltd., Nippon Paper Industries Co. Ltd., and Georgia-Pacific LLC.

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