Like most other markets, Japan has seen the at-home consumption of beverages soar in recent months due to the COVID-19 outbreak. At the same time, the e-commerce channel is capitalising on the cocooning trend as consumers buy their soft drinks online, thanks to both the convenience and the ability to buy in bulk.
Key drinks players in the country have also found an advantage in e-commerce by promoting label-free packaging, thereby reducing plastic use and helping make the recycling process easier.
Japan has relatively strict rules for recycling plastic. Consumers need to separate the PET bottle into cap, plastic film label and bottle. Indeed, many local authorities only recycle the PET bottles. Plastic film-free packaging, therefore, is more convenient for consumers, while also offering drinks brand owners the opportunity to reduce their plastic use and increase sustainability.
Japan’s key beverage companies are starting to promote label-free packaging in their core brands specifically for e-commerce. Without a label, a brand risks losing its identity, along with product information such as a list of ingredients. But, key players’ core brands already have high levels of brand recognition and familiar consumption experiences among consumers. When consumers opt for their favourite brand in a bulk-buy format via e-commerce, the label is not such an important shopping criteria.
Asahi Soft Drinks, a subsidiary of Asahi Holdings, has tapped into label-free packaging in multiple beverage categories, including bottled water, ready-to-drink tea and yoghurt drinks. These label-free versions are only available through the bulk purchase of boxed bottles. The box features all the brand information, but each individual bottle has no label.
Elsewhere, The Coca-Cola Co’s I LOHAS, one of Japan’s leading bottled water brands, has also introduced label-free packaging. Unlike Asahi Soft Drinks, its bottle has an embossed design to show the brand name, again only available for online purchases in bulk.
Japanese consumers are using online more for buying their non-alcoholic beverages. According to GlobalData’s Market Pulse Survey, 18% of them say they intend to purchase these products online more frequently or will start doing so now, while 12% say they intend to continue purchasing them online at their current frequency. These figures are greater than those seen for consumers who intend to stop purchasing or buy less frequently.
Two key product attributes driving consumers in Japan are convenience and money constraints exacerbated by the pandemic. In the same survey, 20% of consumers in the country say that attributes such as saving time and effort are a top priority or more important than before the COVID outbreak, while 23% say the same about products that align with their shopping budget or money constraints. These consumer sentiments are also pushing the use of e-commerce for value-for-money, bulk shopping.
Additionally, 20% of consumers in Japan say that environmentally-friendly packaging is a priority, or is now more important than before the start of the pandemic. Again, this adds impetus to the label-free approach from a sustainability standpoint.
Label-free packaging via e-commerce is attracting Japanese consumers for various reasons and certainly benefits both consumers and manufacturers. This trend should be taken into consideration, therefore, as a strong growth strategy for non-alcoholic beverage brands, not just in Japan, but also internationally.
Click here for details on GlobalData’s report: Japan Packaging Industry – Trends and Opportunities
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