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4 Implementation Steps to SmartLabel Success

Posted By: SGK September 07, 2017

This blog was contributed by Hope Massey, Client Solutions Senior Associate, SGK

SmartLabel™ is a first of its kind product transparency initiative that enables consumers to get easy and instantaneous access to detailed information about the products they consume. The initiative was created by manufacturers and retailers and organised by the Grocery Manufacturers Association (GMA) in conjunction with the Food Manufacturing Institute (FMI) in December 2015.

Why? Well, “It’s no longer sufficient to simply list an ingredient. Consumers want to know what that ingredient is, where it came from and why it is in the product they are considering.” “48% of consumers consider themselves to be ‘not informed at all about the product’ even after reading the products label” and as a result “74% of consumers research online when the information on the product packaging and labels is not enough to meet their needs.”

The key trends that are driving the need for SmartLabel™ - Why is it important?

Desire by consumers for transparency. Consumers are skeptical as to whether big companies have their best interest in mind and to be honest, we can’t really blame them. We have all heard the shocking revelations about what we have actually been consuming over the years; remember the infamous horse meat shock in Europe or the baby milk scandal in China causing illness in infants?

It isn’t surprising that as a result, consumers desire greater transparency and trust with brands and retailers on what is in the products they consume, a massive “98% of consumers believe it’s important for them to consider the ingredients in the products they buy”.

The industry is responding with more natural, healthy and environmentally friendly products and ingredients but have minimal ways to communicate these changes, meaning that consumers are none the wiser and brands aren’t feeling the benefit. SmartLabel™ provides a standardised and trustworthy mobile and web presentation of the product information for consumers to obtain more information, increasing transparency and greater trust.

Perpetual mobile access. Consumers are leveraging their smartphones as a touchpoint to get more information, “82% of smartphone users consult their phones on purchases they’re about to make in store”. SmartLabel™ provides a single source of truth for product data that consumers can easily access by simply scanning a code on the physical package (or by doing an online search) which will lead them to the SmartLabel™ landing page.

C-Suite demand. The recent FDA nutritional labelling changes and Vermont GMO labelling law in the US, highlights the costs and challenges in providing on-pack labelling. By moving labelling off the pack and onto a digital forum, this could provide significant supply chain agility and savings, which is creating a lot of energy and enthusiasm at an executive level. As a result, we are seeing SmartLabel™ implementations being driven from the top down.

Connected packaging. There is a new age of non-traditional marketing channels that are inbound in nature, enabling access to information by creating passive content that consumers can engage with at their own discretion.

QR codes, digital watermarks and other code technologies enable consumers to scan a pack and connect directly to web-based information or messaging, which is controlled directly by the brand owner. SmartLabel™ is another forum for brands and retailers to leverage as another consumer marketing touch point.

“We recognise that now more than ever, consumers are seeking access to an increasing amount of information about the food, beverage, household and personal care products they use and consume, and we as an industry must find a way to provide it to them.” – Jim Flannery, Senior Executive Vice President at GMA.

SmartLabel™ is a North American initiative – Are there plans for global expansion?

It is correct that SmartLabel™ is predominately a North American initiative. It was created in North America and all (well, almost all) brands within SmartLabel™ are North American; that said, other regions need to take note. The need for transparency is active across the globe and there are a number of discussions being had across regions, with the European Brands Association (AIM), Food & Consumer Products of Canada (FCPC), Consumer Goods Forum (CGF), Australian Food & Grocery Council (AFGC) and more, to discuss global adoption of the SmartLabel™ initiative, or something similar.

The FCPC has been working with the GMA to roll out SmartLabel™ in Canada that officially kicked off on 1 July. Acting as a ‘pilot’, this launch will show other regions that SmartLabel™ is a product transparency initiative that can be tailored and adopted across the globe - leading the way is L’Oréal Canada. Additionally, The CGF has initiated a project that ‘aims to provide better transparency of product information to consumers and efficient traceability of products within the supply chain to help business be more efficient and responsive’ stating the need to act is driven by three reasons:

  1. Consumers increasing need for transparency
  2. Developments in legislation
  3. Outmoded industry supply chain transparency and traceability systems

Brands are engaging with SmartLabel™ at varying levels of sophistication - What are the different archetypes?

Since launch in December 2015 the GMA has projected that ‘there will be more than 34,000 products using SmartLabel™ by the end of 2017, including food, beverage, personal care, pet care and household products. By 2020, it is projected that 60,000 products will be using SmartLabel™, which would account for more than 80% of products that consumers buy’.

As it stands today, there are c. 11,755 product pages in SmartLabel™ across 450 different brands, with an additional 13 brands having publicly committed to be live by December 2017. All of these brands have implemented the initiative at varying levels of maturity – so what are the different archetypes that we are seeing?

WATCH: SmartLabel Technology for Shopper Empowerment and Trust  

SGK’s Client Solutions team has been exposed to a number of discussions with companies as they begin to explore their approach to SmartLabel™ and how they manage the new supply chain partners required. These discussions generally fall into two categories:

Program Design - exploring what their strategic goals are, portfolio inclusion, workflow design, partner interaction and content management.

Operational Design - looking at how a company would implement, connective technology and consumer awareness.

And with this exposure, we feel that participants align to one of four archetypes:

Reluctant Participants: Companies whose Executive Leadership committed to participation but there is no strong ownership of vision in implementation.

Regulatory Hopefuls: Companies who are banking on future savings from using SmartLabel™ an online regulatory compliance tool.

Good Students: Companies who have embraced the core purpose of the SmartLabel™ program – driving consumer transparency.

SmartLabel™ Champions: Companies who have established clear, progressive goals for their SmartLabel™ program and have implemented across the majority of their portfolio.

Implementation hurdles – What are the barriers to success?

To implement SmartLabel™ successfully the following four key things need to be taken into consideration:

Process. A new supply chain workflow must be developed to provide labelling information in a new way. With this comes complexities of implementing multiple vendors:

- A code creation partner to create the codes and provide the technical infrastructure that will support the ongoing scanning and activity – leading the way in this space is Scanbuy with QR codes and Digimarc with digital watermarks.

- A website hosting provider such as Label Insight that is equipped to process, store and publish a high volume of product information.

- An artwork provider to apply the codes to an artwork and adapt the packaging graphics to incorporate the code if required.

Content. Detailed information must be collected and organised for each product. Creating an accurate data record of what was printed on each pack is complex and challenging and the time, cost and level of risk involved in re-keying the data to populate the SmartLabel™ pages is huge.

Brands and retailers should look to leverage their pre-press partners to supply product information directly from the approved artwork to populate the SmartLabel™ pages – with this comes a number of time and cost benefits.

Codes. To enable the consumer to connect to the package using their smartphone, each product will require a code for consumers to scan. This presents multiple challenges, such as; technical issues regarding code creation, adjusting the artwork to accommodate the code and placing the code in the correct location to avoid misdirection to the wrong location and the platform that enables you to track and modify performance of your code in the market.

Hosting. SmartLabel™ pages must be hosted for public use and any labelling changes on the package requires a new SmartLabel™ page to be created to reflect those changes. They need to accommodate having multiple packs with different labelling in the market at the same time. The infrastructure needs to be in place to manage the collection and distribution of accurate product data.

SGK has partnered with industry leaders Scanbuy, Label Insight, and Digimarc and can provide a suite of solutions to support implementation of SmartLabel™ and help you optimise this opportunity.

For more information on SmartLabel™ or what comes next to implement the initiative, please contact:

Hope Massey
Client Solutions Senior Associate, EMEA
+44 (0) 774 091 3226 

About Hope Massey: Hope graduated Law and is a certified Prince2 Practitioner and Lean Six Sigma Advanced Green Belt. She has worked on a range of projects including major business change initiatives, process improvements, financial analysis & modelling, cost reduction, business re-structuring and product innovation.

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Mobile Transparency: The SmartLabel™ Story

Posted By: SGK June 26, 2017

According to a recent grocery shopping experience and behavior survey conducted by Open Mind Strategy on behalf of Food Network Magazine, consumers are using their phones in-store for a variety of reasons. In fact, 39 percent are searching for recipes, 40 percent are checking prices, and 28 percent of grocery shoppers are using their mobile devices to check nutritional information.

Methodology: Food Network Magazine surveyed 1,957 consumers age 21-54.

VIEW INFOGRAPHIC: How Ads, Packaging and Smartphones Affect What Shoppers Buy at the Supermarket

Product transparency is incredibly important to consumers, and will remain important in the future. With consumer relationships and preferences changing throughout the years, it’s important for brands to continue to provide more product information so consumers can make informed purchase decisions and answer questions that arise.

Introducing SmartLabel™: A GMA Initiative for Product Transparency

Recently, our Michael Fox, director, client solutions, spoke at PackEx Toronto to discuss how to successfully implement SmartLabel™. The GMA SmartLabel™ initiative is a great example of how brand owners are investing in bringing greater transparency to consumers. It provides a standardized presentation of product information to the consumer, regardless of the brand or product.

Some of the information consumers can expect from SmartLabel™ implementation includes:

  • Nutrition facts
  • Ingredients
  • Allergens
  • Other information
  • Company/brand information

Although this is predominately a North American initiative, there are a number of stakeholders driving global expansion. According to Progressive Grocer, the GMA expects more than 30,000 products to be available in SmartLabel™ by the end of 2017.

Displaying more information on-pack creates design and space challenges. Alternatively, brands can offer non-mandatory information only, but link to the package with an easily scanned QR code or digital watermark. Welcome to the new connected package.

“The ‘connected package’ represents the next generation in packaging, and initiatives such as the SmartLabel™ program will certainly help drive motivation for future adoption.” – Bruce Miller, VP, Product Development, SGK.

While brand owners are increasingly expected to provide more information on a pack that has limited space, initiatives like the new nutritional labeling regulations are consuming more pack real estate. Brand owners are also looking at the Vermont GMO labeling experience, along with a general desire by consumers for more product information. A logical solution is to begin to move some of the communication off the physical pack and onto a mobile screen.

READ: The Connected Package: The Next Generation in Brand Efficiency, Interaction and Appeal

The regulatory and legal environment is always changing, so brands must take advantage of that to see what these changes have to offer. In terms of digital connectivity, some of the offerings are going to have unintended side effects. The federal government’s GMO law could potentially aid the GMA SmartLabel™ initiative, and when you think about where the GMO information can be displayed, it no longer has to just be on-pack. SmartLabel™ will serve as a key source for labeling information, so consumers might be driven from the pack, brand site, or retail site.

“In turn, the datasets for nutrition and GMO information is combined with other brand content that can be served up in a number of ways, thereby bringing additional tools and touchpoints to brand owners, which at the end of the day is a good thing.” – Michael Leeds, SVP, Client Engagement, Americas, SGK.

What is the business case for SmartLabel™

The GMA SmartLabel™ initiative is becoming the most obvious choice for many brand owners, as it also contains a link to additional information that can be customized by the brand owner. In fact, over 30 companies have already committed to using the SmartLabel™, including: Conagra Brands, Kellogg Company, General Mills, PepsiCo, and Procter & Gamble, to name a few.

According to a Transparency ROI Study, conducted by Label Insight, long-term trust and consumer loyalty starts with transparency. In fact, 94% of consumers surveyed said they are likely to be loyal to a brand that offers complete transparency, while three in four consumers say they would be willing to pay more for a product that offers complete transparency. These facts emphasize the opportunity brands have to reflect their consumer’s values.

To learn more about the SmartLabel™ watch our recent BrandSquare webinar: SmartLabel™ Technology for Shopper Empowerment and Trust

About Michael Fox: Michael brings 8+ years of experience effecting organizational change with Theory of Constraint and Lean/Six Sigma Methodologies. He has a broad-based technical background in System & Industrial Engineering and Product Life-Cycle Management.

About Bruce Miller: As Vice President of Product Development for SGK, Bruce Miller leads the practical application of new technologies to the brand deployment requirements of SGK’s clients. His deep expertise in graphic production and management has helped advance the application and performance of graphic workflows for many of the world’s most prominent brand owners. A champion of innovation at SGK for more than 25 years, Bruce has played a pivotal role in the company’s transition from conventional analog to today’s advanced digital technologies and processes.

About Michael Leeds: Michael Leeds has been optimizing brand deployment processes for more than 25 years. He evaluates marketing supply chains through KPIs and best/next practices, which provide insights into the effectiveness and efficiency of a supply chain’s tools, workflows, and resources.

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Michael Fox of SGK to Present GMA SmartLabel™ Webinar

Posted By: SGK May 03, 2017

SmartLabel™ is a website for brands that provides information to consumers about their products. The core intent of the initiative, as determined in 2015 by the Grocery Manufacturers Association (GMA), was to cater to consumer demand for better transparency — answering the question: what’s in the products I buy?

The GMA has created a platform to accomplish this by providing better data to consumers in a standard format that would be familiar and easy to use.

Michael Fox, director of Client Solutions at SGK, will present a webinar discussing how SmartLabel™ provides important opportunities for food, beverage, personal care, household and pet care brands on May 4, 2017 at 10-11:00AM ET.

  • More transparency to build consumer trust
  • A platform for online GMO disclosure
  • An additional consumer touchpoint
  • A platform for additional marketing and connected pack innovation

Join the GMA SmartLabel™ webinar: Expedite SmartLabel™ Implementation with the Assistance of Industry Service & Solution Providers 

The key that would make the whole thing work is connectivity from the package —consumers can scan a code on the package with their smartphone, which would direct them to the webpage. So, in summary, it’s both a product transparency initiative and a connected pack application.

For more information on the connected package, download: The Connected Package: The Next Generation in Brand Efficiency, Interaction and Appeal

About Michael Fox: Michael brings 8+ years of experience effecting organizational change with Theory of Constraint and Lean/Six Sigma Methodologies. He has a broad-based technical background in System & Industrial Engineering and Product Life-Cycle Management.