Digital Labelling: The Future of Smarter Food Labelling in Asia
Digital labelling has been increasingly prevalent in Asia, with an 83% increase in the use of QR codes observed between 2014 and 2018. Additionally, COVID-19 has accelerated the use of QR codes. Data available includes the date of entry, harvest date, product origins, etc. This information is increasingly crucial due to consumer concerns around food provenance and sustainable sourcing. However, there are some concerns, including the potential for misuse of QR labels and the exclusion of digitally disconnected consumers. To advance discussions in the region, Food Industry Asia (FIA) partnered with AlphaBeta to provide a robust fact base on the topic, resulting in the launch of the “Digital Labelling: The Future of Smarter Food Labelling in Asia” report on 11 August 2022.
The launch webinar was attended by over 70 participants from government agencies, companies and industry associations. Ms. YiFan Jiang, Associate Director of Science and Regulatory Affairs, FIA and Mr. Cheng Wei, Swee, Senior Manager at AlphaBeta presented key findings of the report. The report explores key challenges and opportunities of transitioning from traditional physical labels into innovative digital labels, and multi-stakeholder actions that can be taken as technology advances. This was followed by a panel discussion with speakers from GS1 and CPRAM.
Key findings of the report include:
- Demand from consumers and businesses for digital labels is increasing. Majority of the consumers across the region would like to use digital labelling to receive up-to-date information on food products. In addition, consumers think that physical labels are lacking in terms of providing easy-to-read and simplified information on food products. There is also a growing number of food retailers transitioning to QR codes.
- Digital labelling has significant strengths and opportunities, but there are some weaknesses and threats associated with it. For instance, digital labels bring greater flexibility and cost-efficiency in changing labels as there is the reduced need to reprint new labels as information can be edited digitally without incurring high costs. However, certain businesses might fail to catch-up. For instance, smaller businesses might not be able to change their systems and processes due to insufficient funding and technical skills (e.g., inability to upgrade barcode scanners and systems to read digital labels).
- Four countries could lead in the adoption. The study shows that most of the key markets are still in the preliminary stages of digital labelling implementation, with Japan, Korea, Malaysia, and Singapore in the lead (see Exhibit below). These could be the priority markets to advocate for wide-scale digital labelling initiatives and development of relevant regulations and/or voluntary standards to help harmonise the approaches.
The scoring of the vertical axis was based on the presence of use cases of digital labelling for food while the scoring of the horizontal axis was on the total performance around the 10 key enabling factors identified in the study.
- There are five actions to take to enhance digital labelling in Asia. These are 1) Launch pilot programmes; 2) Promote multi-stakeholder collaborations; 3) Launch consumer awareness programmes; 4) Develop enabling digital labelling regulations, and 5) Facilitate regional and international collaboration.
In light of the analysis, there is a promising future for Asia in broad-based adoption of digital labelling as an alternative way of presenting and storing product information to enhance the engagement with consumers, facilitate supply chain management, and provide solutions for the public and private sectors on some of the environmental and regulatory compliance issues.
If you are interested in working with us on this topic, please reach out to Cheng Wei Swee.