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Supermarkets are masters of store layout. All the tricks of the trade are employed, from the smell of baking bread being wafted from the bakery at the back of the shop to the special offers on aisle ends and impulse purchases at the tills. However, all of this changes for customers shopping online for groceries. Shoppers must navigate through a series of menus before clicking on a thumbnail image of the item they want. Packaging that has been designed to stand out on a shelf is expected to entice customers when reduced to an image barely bigger than a stamp.

Does it matter? After all, we buy food for what it tastes like, not what it looks like. However, brands and retailers spend thousands every year making their packaging eye-catching and representative of a brand’s values. Will this become less important as increasing numbers shop online? In 2007, online sales of food and drink added up to £2.74bn, compared to just £501m in 2002. And this trend shows no signs of slowing.

Ocado offers an online shopping service for Waitrose goods. Finance director Jason Gissing says he expects to increasingly display images of food without its packaging on the retailer’s website: Customers want to see what they are going to eat, not what the manufacturer has wrapped it in, sometimes to prolong its shelf life in a shop.

However, Mary Say, managing partner at brand consultancy Distillery, believes this would be a step backwards. It would work for fresh fruit and vegetables. But for other products, the signposting that the packaging provides is still really critical to the sale. You want to know if you’re buying Heinz baked beans or something else. Say argues that websites should be looking to recreate the interaction that customers have with packaging in a store at the point of purchase. Most customers will pick up a pack to have a good look and turn it around to read the back. If there was a way of reflecting this in a scaleable way online that would improve the shopping experience, she argues.

Little fish, big pond
In contrast, Gissing dreams of one day producing a range of Ocado goods packaged only in what would be needed to protect items during transit. Packaging would no longer need to perform its sales role, as goods would be displayed without packaging on the website. However, this is not something he sees happening soon: We are a minnow in the world of food retailing. He explains that Ocado would have to be several times its current size to make this feasible in a market dominated by giants. Ocado’s annual sales are currently £350m, compared to Waitrose’s £4bn-plus.

Ocado is the first UK retailer to offer closed-loop carrier bag recycling – delivery drivers collect used bags from customers, which are recycled back into carrier bags. Gissing adds that collecting back used packaging for recycling is something that he has considered, but for now there are more effective solutions using experts in that area.

Ocado is not alone in considering how packaging could evolve if sold through the home delivery format. Design agency Holmes & Marchant is in the midst of a project with digital agency Fjord, looking at the potential of online retailing. Structural packaging designer Gemma Brooks cites the milk bottle as the classic example of sustainable packaging. Online grocery shopping could operate like a large-scale milkman. Empty packaging could be taken away and refilled, she explains.

Household cleaning product company Ecover already offers customers the opportunity to refill their containers from large vats at a number of independent stores. Ocado, unlike the other grocery retailers, fulfils orders from a central warehouse, rather than taking items out of stores. This format would make refillable containers possible.

Gissing says it’s an idea that has been discussed at Ocado, but it’s not on the horizon. It’s important for manufacturers of food and drinks to package their products in a way that ensures they arrive with the customer hygienically, safe and intact. A certain amount of packaging supports us in maintaining the lowest food waste levels anywhere in the industry, anywhere in the world. It is not certain that changing this model to accommodate the milkman idea, and using more energy to transport, clean and refill packaging, would have a net benefit.

Form or function
Nevertheless, if packaging is not being seen until it has been delivered to the home, it should be considered in terms of its function there. Packs would become more about functionality and usability; they wouldn’t need to look as attractive. What would be important is how it would perform during storage and food preparation. Packaging could perform a greater function during cooking, for example. The pack could also be used to encourage customers to try new items from the range or brand.

Getting customers to try new products when shopping online, however, can be more difficult than when customers are in a bricks-and-mortar store. Distillery’s Say argues there is a paradigm in the way customers interact with brands online. In non-grocery, the internet means that even tiny brands can have a global platform. In grocery retail, it is working inversely to limit our interaction with individual brands down to just a thumbnail image, she says.

Hilary Boys, strategic planning director at Lewis Moberly and a recent convert to Ocado, says that, with the exception of the odd special offer, when shopping online you tend to gravitate to brands you already know. Impulse purchases are much harder online. It is very easy to click on the same things every week. She adds that it has got to the point where her 14-year-old daughter has offered to shop and cook dinner just so they can eat something different.

Holmes & Marchant strategic planner Rory Fegan believes this is largely down to the structure of online shopping websites. When you go into a shop there is the opportunity to look around and be inspired. That’s not what happens online – you can’t browse. The web is more like a 1950s shop – where the guy behind the counter goes off and gets your food for you. Packaging’s role in the sales process is therefore effectively removed. This is fine, he explains, but it means you have to know what you want to buy before you go into the shop.

Maintaining the brand
Gissing says Ocado has trialled a virtual store format for its website, rather than the directory style it and other online retailers favour. However, he believes the current format is more intuitive, with better usability.

Distillery’s Say believes adding branding to the current format might be the way forward. Brands could have microsites within the supermarket’s main site. Or branding from the packaging could be expanded to form a backdrop to areas of the website where the products are sold – creating more of an experience.

However, Margaret Manning, chief executive at digital agency Reading Room, argues it is vital online retailers don’t lose sight of what they are trying to achieve – namely sales. Tesco and Ocado have got it really well stitched up. Our whole behaviour online is different. We expect to be able to track things down quickly and buy them, she says.

Manning argues that retailers can get caught up in creating an online shopping experience rather than a functional sales tool. Brands often have ideas about creating beautiful sites, but they become hard to navigate. They aren’t sure if they want to create an advert, like you would see on TV, or a shop. One brand, that shall remain nameless, was running a very successful e-commerce site and approached Reading Room to ask the agency to create a separate purely experiential website. Reading Room refused. What would be the point? asks Manning. You wouldn’t build a shop that you couldn’t buy anything in so why build a website? The internet is a place for business. How packaging adapts to the online sales process remains to be seen.

POSTAL PACKS
Macfarlane Group had been selling corrugated transit packaging to online retailers for some time when it decided the best way to service the growing market in smaller companies was by setting up its own e-commerce site. Packaging2u.co.uk aims to sell everything an online retailer could need to ship their goods.

Packaging2u’s managing director Mark Selby explains that the internet enables much smaller businesses to operate, without the need for overheads of a physical store. Our ability to get sales execs on the road and out to see these small businesses is limited and it’s not cost-effective. The internet allows us to attract new small to medium-sized customers that order in volumes that are too small to be able to work with Macfarlane’s traditional set-up.

Selby explains the key to making small orders profitable is a highly automated system; the more people involved in processing an order, the more expensive it becomes.

I can only see that the momentum of growth in online shopping will continue into the foreseeable future, says Selby. And the more businesses that sell over the internet, the more businesses that will need transit packaging of some description to transport goods from the virtual sales portal to customers’ physical front door.