KANSAS CITY, MO — The way the world does business has changed dramatically and so has consumer expectations for the items they purchase. CPG companies have raised a red flag: 1D technology is struggling to meet the advanced needs of retailers, consumers and the supply chain as a whole.
While it’s important to note that the move from UPC codes to bar codes isn’t mandatory, brands that make the transition stand to gain a significant competitive advantage. Factored into the ROI is the increased consumer engagement that comes with providing the additional product information shoppers want.
“We know that 77 percent of consumers want product information when they’re making a purchase,” said Amber Walls, senior director of global standards for GS1 US, the non-profit organization responsible for establishing supply chain bar code standards since it introduced the original UPC code. “Consumers expect brands to have a QR code and be able to get information on their phones. It’s so ingrained now. Everything for consumer engagement is mobile-friendly. QR codes are a product differentiator and an enabler for innovation in many ways.”
That’s because they can put a vast amount of information at consumers’ fingerprints, allowing them to make purchasing decisions instantly.
“The ability to speak to the consumer while they’re in the store and beyond presents a big opportunity to increase engagement and basket size,” said Karen Reed, global director of marketing and communications for Kwik Lok. “QR codes can offer a more in-depth and personal experience that includes everything from tailored recipes and video content to important safety and cross-promotion opportunities. As the technology is more widely adopted, the customer experience will become much richer and, perhaps more importantly for marketers, expected by the consumer.”
An enhanced consumer experience is another potential benefit of adding QR codes. Datassential’s “Marketing Issue: Brand Activations Report” found that 46% of consumers overall want an immersive experience from the food and beverage brands they’re loyal to, with 59% of Gen Z and 55% of millennials expressing more interest in experiences compared to Gen X or baby boomers.
“It’s no longer just about the product,” said Tom Egan, VP of industry services for PMMI, the association for packaging and processing technologies, which has been working closely with GS1 US. “It’s more about the experience, the background story of how the product came about and where the ingredients were sourced. Those are great elements and not ones that easily fit onto a package.”
Following close behind experience is the ever-present consumer expectation of convenience.
“Consumers expect brands to have a QR code and be able to get information on their phones. QR codes are a product differentiator and an enabler for innovation in many ways.” — Amber Walls | senior director of global standards | GS1 US
“Convenience is going to drive acceptance,” Egan said. “The convenience of pulling up additional data for whatever package the consumer is holding is going to drive use. I can see them saying, ‘I can scan a QR code and get an interesting story about how this 9-grain bread is healthy for me, why it was developed and what farms are contributing to it. This other bread next to it still has a UPC code, and the packaging says it’s healthy. I’m going to scan the QR code and get more information.’”
QR codes also offer brands potential cost savings down the road. Linking QR codes to digital content and updating or redirecting those links as often as needed in real-time gives brands flexibility that could result in cleaner-looking packaging and fewer overhauls.
“Brands can link their QR codes to a nutrition page, a social media campaign or to something seasonal — whatever content makes sense at the time,” Walls said. “It’s a dynamic experience and very practical in terms of accessibility.”
Migrating from UPC to QR bar codes will require packaging changes at some point, and that often requires a long runway for planning and design. Egan encourages brands to start the discovery process now by engaging their internal teams and their packaging suppliers about determining the right time to make the transition, where to place the QR code and when to remove the UPC code.
“Please start,” he advised. “2027 seems far away until you start thinking about everything involved with packaging changes, especially for large organizations with hundreds of SKUs. The recommendation is for companies to start with primary packaging because that’s where the consumer will see the benefit.”
The UPC bar code has served the industry well for half a century, but it has earned its retirement. The next generation of bar codes is ready to help retailers and brands reap the advanced benefits of making the switch: a fully optimized supply chain, increased transparency, and an enhanced product experience capable of attracting and retaining consumers.
This story has been adapted from Commercial Baking’s 2024 Innovations Annual. Read the digital edition here.
