- February 01, 2003, Ann Hirst-Smith
With major brand owners continuously seeking unique features for labels and packaging that will aid product differentiation, the self-adhesive label industry can expect to retain its pre-eminent position for the foreseeable future — but only if it can continue to innovate and to offer consistent quality, good logistics, and the optimal price/performance ratio.
Self-adhesive technology now dominates the world of labeling overall. With more than 50% of the total market in some regions of the world (including all uses from prime labels to variable information print such as bar code labels and express courier delivery/tracking labels), it has eclipsed the wet-glue label — but current research indicates it is just one of the choices available to the label buyer. Today there are plenty of alternatives, and indeed, many product manufacturers choose to employ more than one decoration technology on their products.
Most products have a short “trial” life to prove themselves at retail level — it is estimated 90% of all new products have a maximum of one year to catch the consumer's attention. Since brand recognition and consumer approval are the most important factors for the survival of a product, the esthetics of product packaging are of prime importance. Shelf space is limited in supermarkets and competition intense among product manufacturers — particularly in packaged food and beverages. As multinational manufacturers continue to fine-tune their product ranges to take advantage of economies of scale (Unilever not long ago pared its portfolio of brands from 1,600 to just 400), the product decoration market is being pressured to respond to end-users' demands for creativity — but without increased costs. Packaging inventory is another issue for the manufacturers: Today suppliers at all levels must deliver smaller quantities, faster.
In this business arena, it's easy to see that label printers specializing in fast, long-run label work (the traditional market for wet-glue labels) now have a limited market. While self-adhesive labels are today's preferred answer for short- to medium-length runs; for multi-versioning same-size, same-style labels for different scents or flavors of the same parent product; and for meeting the packaging manager's need for added-value features, they are by no means the only option.
Alternative labeling technologies are making quite a few inroads into consumer packaging for the equivalent of prime labels — particularly sleeving and in-mold. The combination of the wraparound, heat shrink, stretch, and roll-on-shrink-on categories of sleeving continue to grow annually in double digits — a reflection of the growth in use of plastic containers, particularly larger-sized bottles. Wraparound sleeves — both paper and film — lead in terms of volume, and when printed on clear or opaque films, can offer a cost-competitive “no label” look on PET bottles. OPP film manufacturers such as ExxonMobil have added extra capacity specially suited to wraparound usage.
It is the shrink sleeve, however, that has caught the imagination of packaging designers working in the fields of “fashion” beverages — beers, alcoholic beverages, and soft drinks. As well as their 360-deg graphic possibilities, they can give top-to-bottom coverage of the container, whatever its shape or contour. They also provide added integral functional qualities: tamper-evidence, reduced danger of splintering for glass containers, and light and gas barrier properties. Shrink sleeves, however, are a specialty niche, with their own special design (“morphed” graphic images) and production demands, and tend to be supplied by one-stop-shop manufacturers that offer integrated film extrusion, design, and print. Global examples are Fuji Seal and Sleevers International.
Wet-glue is still the best option for many long-run applications such as corrugated can labeling, and it continues to be the main use for paper labels. Beverages (particularly beers and carbonated soft drinks) and food (particularly processed foods, dairy products, and powdered drinks) are the end-use markets that consume the majority of wet-glue labels.
Wet-glue labels offer low cost and high application speeds, even though the application equipment has a high capital cost and may be perceived as “messy.” While the high investment in equipment is a deterrent to technology change — for example, to self-adhesive — wet-glue labeling's market share is static, and its major markets such as beer labeling are at risk as container styles, materials, and marketing approaches are changing.
In-mold labels — particularly those applied during blow-molding — continue to grow at around 8%/annum in North America and are most popular in the household chemicals market (for “under-the-sink” products) and in foods, for labeling of injection-molded containers for ice creams and spreads. Interestingly, this latter application often is combined with direct-printed lids or with self-adhesive lid labels — a good example of packaging buyers' desire to mix and match decorating technologies.
As a pre-decorating process, in-mold labeling often is carried out by contract packers and offers a number of advantages for the markets it serves — which include its low associated material costs (mainly PP films), cost-effectiveness for high-volume applications, durability, and the ability to accommodate large label sizes. Conversely, it can involve high inventory costs for the end-user, as well as high capital and set-up costs, and it is, of course, suitable only for plastic containers.
Direct print enjoys a diverse usage on packaging. Cartonboard applications include juice cartons and folding cartons for chilled and frozen foods and cards for blister packs. Plastic packages include screen-printed, blow-molded bottles for household chemicals, health and beauty care products; thermo-formed and injection-molded food containers; and the new and increasingly popular metallized pouches. Aluminum and steel cans often are directly litho printed for beers and soft drinks. Glass bottles — for beers, wines, mineral waters, etc. — also are screen or thermal transfer printed directly onto their surfaces. Together, these applications are extending the boundaries of directly printed packaging and obviating the need for a conventional “label” at all. However, their prospects are limited by the high costs associated with the technologies, limited flexibility and opportunities for innovation, and perceived low print quality capability.
There are, of course, a number of other minor labeling technologies on which the end-user can fall back, including tags, hot foil stamping, and developments in “hybrid” self-adhesive/wet glue systems, and there still are some adherents to the declining technologies of heat seal and gummed labels. But overall, while self-adhesive labels continue to dominate and the product manufacturer's and retailer's focus is on higher-impact brand packaging without associated higher costs, it's the overall field of sleeving where we can expect to see continuing market development and innovation.
Ann Hirst-Smith is an associate of AWA Alexander Watson Assoc. and an independent journalist specializing in the fields pf packaging and labels, self-adhesive materials, and large-format graphics.