What is Smart Packaging?

First Published: February 28, 2024

A few years ago, I attended a GS1 Connects conference, and one of the presentations focused on how a product’s primary packaging can be a brand’s most important communication tool for interacting with customers.

This was an excellent introduction to smart packaging – where the product can interact with the consumer, providing access to diverse information, enabling customer engagement and more.

In a world where consumers are getting tired of constant advertising and brand social media pages, using the product itself as a communication tool becomes more and more important.

This article delves into smart packaging, exploring its role in customer engagement and its advantages through technologies like 2D barcodes, Augmented Reality (AR), digital watermarks, and Radio Frequency Identification (RFID).

So, Just What is Smart Packaging all About?

Smart packaging refers to packaging systems incorporating advanced technologies to communicate with consumers and provide additional benefits such as tracking, protection, and enhanced user experience. It’s actually an umbrella term that includes both active packaging, which extends the shelf life of products, and intelligent packaging, which communicates information about the product’s condition.

I’m focusing on the interaction/information aspects in this article and will create some information on the other smart packaging applications in the future.

Engaging Customers with Smart Packaging

One of the most significant advantages of smart packaging is its ability to engage customers in novel and interactive ways; brands can connect consumers to digital content with a simple smartphone scan.

This content can range from detailed product information and usage tips to interactive experiences like games and contests, fostering a deeper connection between the brand and its audience.

2D Barcodes

Using 2D barcodes, such as QR Codes, has been a simple way for brands to get started with smart packaging.

Because these 2D barcodes can contain an encoded URL, they can be printed on the package and guide the customer to online resources once they scan the code.

There will be a major boost for 2D barcodes when GS1’s Sunrise 2027 program replaces the UPC barcode currently printed on most products with a more data-rich 2D barcode.

One important option for this is GS1’s new Digital Link barcode encoding syntax. This allows a single barcode printed on the product to be used at the point of sale, containing date, lot and serial information and a link to online content.

Digital Link is a new concept that provides advantages for brands, retailers and consumers; if your company is not already investigating this, it would make sense for them to learn more about GS1’s Sunrise 2027 project.


RFID technology in smart packaging offers a seamless way to track products throughout the supply chain, ensuring authenticity and reducing the risk of counterfeits. RFID can mean the difference between buying a genuine or fake product for consumers.

Moreover, RFID tags can store a wealth of product information, accessible with specialized readers, adding another layer of interaction and engagement.

Both UHF RFID tags and NFC tags can be used to add customer engagement to product labeling. NFC (Near-Field Communication) is particularly useful since consumer devices such as Android and iOS smartphones can read these tags. UHF RFID is usually used for more industrial and logistics data capture and needs special RFID readers to be able to read the data encoded in the tags.

While the GS1 Digital Link program is designed for various technologies, including RFID and NFC, the only approved data carriers currently are QR Code and Datamatrix.

Augmented Reality: A New Dimension of Interaction

AR Wine Labels from AR-Winelabels.com

Augmented Reality (AR) takes customer engagement to a whole new level. By scanning smart packaging with AR-enabled apps, consumers can unlock immersive experiences. For instance, a wine label might reveal a virtual vineyard tour or a cereal box could bring a beloved mascot to life.

These memorable interactions enhance the product’s perceived value and drive brand loyalty and word-of-mouth marketing.

See AR in action on the 19 Crimes wine labels – I thought this was so cool when it was released a few years ago:

Digital Watermarks by Digimarc

Carton Image from Digimarc Demo Materials

Digimarc is an incredibly innovative organization that has developed a range of tools that are used throughout the lifecycle of products and their packaging.

The Digimarc watermarking process effectively turns the complete printed package into a data carrier – the encoded information is repeated many times over the surface of the product so it can be read in any orientation.

Many industrial and point-of-sale (POS) barcode scanners can scan these embedded codes, and they have already been adopted by some major retailers, such as Wegman’s and Walmart, for their private-label products.

Digimarc has ensured that its encoding system is compatible with GS1 Digital Link, creating interesting future opportunities as more data carriers are approved for retail applications with Digital Link.

Beyond Engagement: The Multifaceted Benefits of Smart Packaging

Smart packaging isn’t just about captivating customers; it’s a multifunctional tool that offers numerous other advantages:

Supply Chain Optimization: With real-time tracking and inventory management, smart packaging can significantly streamline supply chain operations, reducing waste and improving efficiency.

Product Protection: Active packaging technologies can monitor environmental conditions like temperature and humidity, ensuring products remain in optimal condition throughout their journey from the manufacturing or processing plant to the consumer.

This can be done in real-time, using GPS enabled tags.

Sustainability: By reducing material usage and waste, smart packaging aligns with eco-friendly practices and appeals to environmentally conscious consumers.

A great example is how Digimarc watermarking is being used in high-speed sortation systems for sorting and grading plastics recycling operations.

Data Analytics: The data collected from smart packaging interactions provides valuable insights into consumer behavior, helping brands tailor their marketing strategies and product development.


Smart packaging is more than just a trend; it’s a strategic tool that bridges the physical and digital worlds, offering endless possibilities for customer engagement and operational excellence. As technologies evolve, we can expect smart packaging to become even more integrated into our daily lives, enhancing how we interact with products and brands.

Further Reading

The GS1 Digital Link Implementation Guide provides detailed information on this new barcode syntax.

Check out Digimarc’s demo materials for digital watermarks.

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