Urbanisation Radar:  the retail of packaged consumer goods

​How is urbanisation affecting the way families and individuals live in the modern city, and what are the effects of these changes upon packaged consumer goods?

2/2018 TEXT: IAN FENTON, IMAGE: SHUTTERSTOCK

​Today in developed economies we can see the mature stages of an urbanised environment, and the effects this setting has upon lifestyle and consumption. 

For example, households are smaller, both in terms of physical space and number of occupants. Euromonitor has predicted that by 2030, urban households globally will contain an average of three persons while their rural equivalents will average 4.4 persons. The urbanised environment also sees a growing number of single-person households. 

This has diverse implications. It sets the scene for the sharing economy, for one thing. Flat sharing becomes a convenient accommodation model in this situation. And in terms of transport, car-sharing services and the increased optimisation of public transport are stimulated.

As car ownership decreases hand-in-hand with these trends, this naturally has an effect on how consumers shop. While hypermarkets outside the city centre are still growing, that growth has slowed, in favour of other channels. 

The retail setting is diversifying, and the city dweller can be expected to make more of their purchases from small, locally situated shops – and more frequently, as the weekly car-enabled shop is no longer a convenience nor (with declining vehicle ownership) a possibility. Large discounter chains are also increasingly prevalent within city centres.

These varied retail channels give rise to varied packaging needs. Packages themselves are becoming more diverse to suit the new demands, from the retail-ready corrugated card boxes required by the hypermarket to smaller package sizes oriented towards local grocery chains, and effective multi-pack solutions for the discounters. At the same time busy consumers find e-commerce an increasingly convenient way to shop. With this channel taking more and more market share, further new requirements are brought to bear on packaging – a topic we will explore in more depth in our next instalment.

A shifting work/life balance is also characteristic of the urbanised environment, particularly in the case of millennials. The lines between work time and free time are blurring, with individuals increasingly likely to work at home (thereby avoiding transport issues altogether).

Being busy around the clock means eating on the go and taking advantage of ready-made meals, another opportunity for small shops and local retailers, and a category of course, with its own set of very specific packaging needs.

Finally, studies have shown that, in most countries, students performed better academically in urban settings than their rural counterparts, demonstrating that concentrated educational resources have distinct advantages. In terms of consumption, we could posit that better educated citizens make more demanding customers – an indication that the packaging needs of the city dweller will continue to stimulate innovation even further.


Read more about the topic:
Urbanisation Radar: an introduction
Markku Leskelä's blog post about urbanisation

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