Understanding SIPP
Ships in Own Container (SIOC) has recently been renamed to Ships in Product Packaging (SIPP) to better reflect Amazon’s program’s objective. It aims to provide a better customer experience by delivering products in their own packaging – no additional packaging material is added by Amazon for the fulfillment.
All sellers participating in the Fulfillment by Amazon (FBA) program, which allows them to outsource order fulfillment to Amazon, can participate in SIPP. The program is available to sellers selling in USA, Canada, France, Germany, Italy, Spain, and the UK. Starting January 1, 2025, products not certified under SIPP will incur a return fee based on the shipment's weight.
Take advantage of SIPP and enhance your brand experience
Think of SIPP as a way to drive the consumer and packaging experience for your brand, reduce cost and meet your sustainability goals:
✅ Improved customer experience
Branded packaging: Convey meaningful messages that connect the order to the delivery experience, encouraging consumer engagement by increasing brand awareness
Unboxing experience: Gain total control over packaging design to create an exciting and memorable unboxing experience
Easy-to-open: Simplify the unboxing process, making it more convenient for customers
✅ Reduced cost
Lower fulfillment fees: By participating in SIPP, sellers reduce fulfillment fees as products ship without extra packaging, reducing both material and handling costs
Savings on packaging materials: Brands save on costs associated with additional packaging materials
✅ Improved sustainability
Environmental impact: SIPP helps reduce packaging waste, aligning with consumer preferences for eco-friendly practices
Brand image: Enhancing a brand’s reputation by showcasing its commitment to sustainability can attract more customers
Branded packaging enhances the consumer experience (source 1)
Design challenges that require smart strategies
Some constraints need to be managed during the design phase – with a holistic design approach these can be easily overcome:
❌ Design constraints: When deciding whether to use the same packaging for both e-commerce and retail, it is important to ensure the packaging stands out on the shelf and also works in e-commerce.
❌ Packaging durability and testing: Products must pass ISTA-6 testing standards to ensure their packaging is durable enough for shipping without additional protection.
❌ Privacy concerns & risk of theft: Shipping in original packaging may reveal the product contents, posing privacy issues for some customers. Amazon allows customers to choose additional packaging at checkout to mitigate this concern.
❌ Initial investment for redesign: Brands may need to invest in redesigning their packaging to meet SIPP standards, which can involve significant upfront costs.
Strategies to overcome challenges and drive innovation
➡️ Adjust your design strategy to have powerful graphics that leverage benefits.
➡️ Smart structural design can provide material savings and add protection.
➡️ Privacy concerns can be mitigated by the customer during check-out and according to Amazon there is no correlation between SIPP and theft.
➡️ Stronger brand image and long-term savings of reduced commissioning and handling fees outweigh the cost of redesigns.
The way we think of SIPP is that it is a huge opportunity to drive customer experience and unboxing and touch-point with the brand. The full ownership of the unboxing experience is essential.
Quick wins: many packaging are already fit for SIPP, such as apparel or products that are already packed in boxes
Minor adjustments: Often small design changes and additions of eg. tape stripes are needed
Rethink: Redesign of the packaging to remove and change of the structure achieving the benefits for reduced material, optimized cubage and enhanced brand experience
Transition packaging to SIPP (source 1)
Sustainability benefits and size efficiency with SIPP
SIPP aligns with broader regulatory trends for packaging waste reduction. The Packaging and Packaging Waste Regulation (PPWR) mandates companies to minimize packaging waste and ensure recyclability. By shipping in original product packaging, SIPP helps brand owners comply with PPWR, reduce waste, and enhance sustainability.
The PPWR defines the Empty Space Ratio (ESR) as the proportion of unused space within packaging relative to the total packaging volume. Starting January 2030, the ESR must be below 50%. Sales packaging that serves as its own shipping box without extra packaging is exempt from this requirement.
Consumers are considering their environmental impact
Consumers and companies are continuously becoming more and more concerned about the environment and programs such as SIPP are a good to address issues such as overpacking and waste during the shopping experience. Looking at different consumers studies the results show that consumers are continuously considering their environmental impact during the shopping journey.
Survey results - Shoppers want more sustainable options (source 2/3)
Do you want to be ahead of the curve with packaging and meet legal regulations and customer needs?
We at PSL | Packaging Strategy Lab can help you create innovative retail and e-commerce packackging. Our team of experts is ready to guide you through the entire design and certification process, ensuring your packaging meets regulatory requirements and enhances your brand sustainability and customer experience 🌍📦.
Source:
1. Amazon Ships in Product Packaging Program for FBA Sellers Explained. https://www.youtube.com/watch?v=xRmNDd9XTAA&t=60s
2. Depecik, B., Cosguner, K., & Astvansh, V. (2023). The Sales Effect of Innovative Package Changes: Evidence from the U.S. CPG Industry. https://ssrn.com/abstract=3984942
3. DPI Technologies. (2024). 2024 Sustainability, EV, and Convenience Retail Survey Report. https://pditechnologies.com/wp-content/uploads/2024/04/2024-Sustainability-EV-Convenience-Retail-Survey_Report.pdf