JAPAN | By 2028, online shopping is expected to drive 21 percent of Japan’s cosmetics and toiletries (C&T) market, underscoring the necessity for improved consumer protection measures in online purchasing.
C&T manufacturers stand to benefit significantly by investing in innovative packaging technologies, such as blockchain and data tracking, to check counterfeiting.
This trend coincided with the anticipated value growth of e-commerce sales in Japan’s C&T industry, set to expand at a CAGR of five to seven percent during 2023–28.
“C&T brands face significant risks from counterfeit products, making it essential to tackle these issues to protect consumer safety and preserve brand reputation,” said Mani Bhushan Shukla, Consumer Analyst at GlobalData.
“Investing in innovative packaging solutions becomes crucial as more customers shop online, where they can’t interact with sales personnel or physically test products. Intelligent packaging can offer consumers the reassurance they need by providing authentication and transparency, helping brands safeguard their products and build trust with their customers.”
Shukla added that younger demographics were highly attuned to pricing, brand image, and current trends, driving their demand for the latest products at competitive prices. This group was also comfortable with online interactions, where beauty influencers frequently promoted products on social media, leading to a significant rise in online purchasing behaviour.
He said a survey corroborated this trend. Among Japanese respondents, 46 percent of Gen Z and 58 percent of millennials stated that they had been buying non-grocery products online, including C&T, more often in the last three months.
Correspondingly, 35 percent of Gen Z respondents and 37 percent of millennials stated that they have been engaging in more frequent purchases of non-grocery products through social media platforms, including C&T.
Mariko Kadosaka, GlobalData's Key Account Director for Japan, also noted that modern consumers were increasingly interested in the details of the products they purchased, such as the origin of ingredients, sustainability credentials, and packaging recyclability.
Intelligent packaging could meet these demands by incorporating features like scannable QR codes. This transparency would help build consumer trust and strengthen their connection with the brands they engage with.
“The counterfeit market, valued at trillions of dollars, presents a major global challenge across industries, including C&T. To combat this issue, many companies are turning to technology for solutions that serve various purposes,” said Kadosaka.
“This shift is driven by the need to showcase the sustainability and ethical practices of their supply chains, in addition to addressing counterfeiting concerns. Aligning with this trend, Meiyume introduced NFC-enabled smart packaging to address counterfeiting, enhance consumer personalisation, and strengthen brand value.”
Kadosaka highlighted the increasing importance of intelligent packaging alongside the digitalisation of supply chain operations.
New packaging features incorporating advanced “smart” technologies allow manufacturers to revolutionise their operations. These innovations can optimise inventory management, reduce transportation costs, and minimise waste, leading to more efficient and sustainable supply chains.
Shukla also added that the future of intelligent packaging solutions offered key benefits, including improved consumer engagement, reduced counterfeiting, and enhanced brand loyalty.
“Interactive packaging can attract first-time buyers and encourage repeat purchases by offering unique experiences. With numerous ecommerce touchpoints, consumers are often drawn to appealing offers from trusted brands. By implementing intelligent packaging through an application or directly on the product, consumers and brands benefit: consumers receive secure, trustworthy products, while brands protect their trademarks and preserve their reputations.”
