Smart label market size is forecast to reach $15.7 billion by 2025, growing at CAGR 10.60% during 2020-2025 owing to the growing entry of counterfeit products especially in the retail, healthcare/pharmaceutical, fast-moving consumer goods, and other sectors. Apart from this the supply chains across these industries are opting for various advanced package tracking and automated material handling systems to handle the packages during warehousing and dispatching which is further driving the demand for the smart label market.
Key Takeaways- Smart label Industry Outlook
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Technology – Segment Analysis
RFID tags/labels market accounted for the highest share of the smart label market in 2019 owing to the cost-effectiveness, high traceability and ease of handling. These type of labels are majorly adopted in retail, automotive, manufacturing and other industrial sectors for supply chain management, inventory management and asset tracking applications. Sensing labels are estimated to witness the highest adoption, especially in the FMCG sector during 2020-2025 owing to the growing demand for tracking and monitoring the quality of perishable goods. NFC labels are also poised to witness significant adoption in the retail and FMCG sector owing to the growing customer awareness against counterfeit items. NFC labels can provide necessary authenticity details along with other product-related information to the customers through scanning the label using a NFC enabled smartphone.
End-User – Segment Analysis
Logistics sector attributed to the largest share of the smart label market in 2019 owing to the broad use of RFID labels to track the package across the supply chain. However, retail sector is estimated to witness the highest growth of around CAGR 14% followed by FMCG sector during 2020-2025 owing to the growing penetration of counterfeit items in this sector. The growing customer awareness towards branded products is also analyzed to be one of the factors assisting the market growth. Apart from this, innovative marketing strategies are being opted by the suppliers to stand out against the counterfeit or competitor products through smart packaging and labeling solutions. This is also poised to be one of the smart label market driving forces in the retail sector
Geography – Segment Analysis
North America acquired the major market share of around 36% of the global smart label market in 2019 owing to the broad presence of customer based and high adoption rate innovative labeling products. APAC smart label market is estimated to witness the highest growth rate during 2020-2025, owing to the high penetration of counterfeit item in the APAC market, large tech savvy customer base and growing awareness related to product genuineness especially for branded items. Apart from this the high penetration of printed electronics in this sector is also set to pave the way for low cost printed smart label products’ manufacturing thereby driving the market during 2020-2025
Drivers – Smart Label Market
Growing Emphasis on Customer Satisfaction
The suppliers in the high volume goods production has been analyzed to be the major adopters of IIoT in production, packaging, labeling, material handling, and distribution; there is a shift in focus of these suppliers towards the customer engagement with smart packaging solution to achieve the next level of customer satisfaction. This is resulting in the use of smart packaging solution authentication, tampering detection, temperature detection, tracking, reordering stocks and various others, which can take customer satisfaction to the next level by improving the customer experience while buying the products. This is set to drive the smart label market during the forecast period 2020-2025
Challenges – Smart Label Market
High Cost of Smart Labels and Production Equipment
The cost of smart labels for use in high volume products is significantly high as compared to conventional labels. Printed electronics-based smart labels can have lower prices but the capital intensiveness of printed electronics production equipment and cost of die for unique smart labels is analyzed to be one of the major factors impeding the launch of cheap printed electronics smart labels, thereby impeding the market growth
Top 10 companies operating in the smart label market includes Zebra Technologies, Smartrac N.V., Checkpoint Systems, Inc., Sato Holdings Corporation, ASK S.A., Invengo Information Technology Co Ltd, Avery Dennison Corporation, Ccl Industries, Inc, William Frick Company, Graphic Label, Inc and so on. The market is analyzed to be moderately consolidated and highly competitive owing to the entry of new players in the market with innovative solutions, significant product differentiation, medium switching cost and various other factors.
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