Selling a product in today’s world is not just about quality and price point anymore. Packaging has become a key factor in the way companies sell products, and specifically, how (if at all) they are making packaging more sustainable. What companies want to know now is if consumers take their carbon footprint into account when buying products and how they respond when companies make an effort to create more sustainable packaging for their products.
In a recent conversation with sustainability consultant Candace Hodder and professor of Supply Chain Management at Arizona State University’s W.P. Carey School of Business, Kevin Dooley, AirTalk’s Larry Mantle addressed how companies can provide convenience to consumers without inundating landfills.
Dooley explained that at the point of purchase, consumers are attracted to larger and more durable (metal or glass) - and usually less sustainable – packaging. While some look for sustainability information on packaging, most ignore it. However, once at home, consumers are often frustrated with too much packaging and more sensitive to the disposing and recycling steps – and ambiguity about how to appropriately recycle materials makes them less likely to do so, Dooley explained.
That has certainly been the case with Keurig, whose K-cups are filling landfills at a rate of 9 billion per year. Hodder pointed out that to recycle K-cups, consumers have to disassemble the cups, which can be complicated and time-consuming. To mitigate this, Keurig introduced a program for workplaces where they can purchase bins and send K-cups back whole; they are then sent off for energy recovery from incineration and the grounds are composted. However, this option is not yet available for homes.
Competitors are already challenging Keurig’s market share with more sustainable K-cup options, Hodder noted. Canterbury Coffee Company, based in Canada, has developed a 97 percent biodegradable cup; White Coffee Corporation recently introduced a new BioCup that is completely biodegradable when aerobically composted; and Nespresso has introduced aluminum cups with a take-back program.
“There is still a lot of room for innovation. We’re seeing companies exhausting more of those ‘quick-win’ strategies. In terms of exploring new materials, making packages more recyclable - there’s a huge opportunity. We’re seeing really innovative things happening,” said Hodder. She cited Method, which uses plastic harvested from ocean gyres, as a prime example of packaging innovation, and Dow Chemical, which has recently found a way to turn plastic waste into fuel.
Though individual products are making an effort to reverse the plastic tide, Dooley thinks it may be easier to move the whole market at once. For example, powdered laundry detergent is much easier to package sustainably than liquid detergent. However, changing the market perception of powder detergent didn’t happen until companies collectively decided to downsize packaging, he said.
However, both Hodder and Dooley recognize the necessity of durable, sometimes bulky packaging to protect items and prevent theft, especially for electronics.
According to the most recent EPA report, only 12 percent of all plastic packaging is recycled. Hodder said the onus lies with companies to improve and communicate product recyclability and with consumers to separate correctly and recycle.
Consumer demand for more sustainable packaging is growing rapidly – especially among millennials – and more and more investors have begun to pressure consumer goods companies to increase the recyclability of their packaging.
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Published Mar 17, 2015 4pm EDT / 1pm PDT / 8pm GMT / 9pm CET