Digital technologies have substantially disrupted a number of traditionally analog industries (computers, cameras). “Are we at a point today when digital printing can revolutionize the consumer packaging industry?” the report asks. In certain segments, use of digital equipment for packaging is already compelling (labels for short- to midsize-run lengths). Beyond those segments, growth for digitally printed packaging is expected to continue, creating both an opportunity and a threat for players exposed to analog printing (flexography and gravure). Nonetheless, the existing barriers to adoption are real, which is expected to drive a more gradual “evolution” of the overall packaging market, rather than a rapid “revolution.”
The report estimates the 2016 global digital printing for packaging market at about $10 billion. Labeling accounted for more than $8 billion of this total, and corrugated made up another $1.5 billion. The study forecasts that the market will double to about $20 billion by 2020. CAGR% for various sectors over the next three years is likely to be 10.2% for labeling, 13.6% for corrugated, 37.5% for folding cartons, 29.1% for flexibles, and 39.8% for all others.
Some key takeaways from the L.E.K. Consulting study:
- Brand owners are increasingly turning to digital printing to produce innovative designs that drive
brand appeal and pique consumer interest.
- Today, food and beverage companies make up 50-60% of the digital print-services market. Regional
Tier 2 and private-label brands in particular have embraced digital printing.
- Digital tech also is creating opps for other participants within the value chain, including package designer, prepress, printer and converter segments.
- The market for digitally printed packaging is expected to grow incrementally, slowed by legacy printing environments, current technology limits, and competition from analog equipment.
- But as the tech improves and costs drop, digital printing is likely to attract more Tier 1 companies
and firms that have a wide range of SKUs and packaging formats.