Product Packaging As We Know It Is About to End

Climate concerns will lead to radical redesigns

Illustration of a shampoo bottle
CPG manufacturers are starting to go green, taking consumer concerns into consideration. Getty Images

Key insights

Time magazine’s decision to name teenage climate activist Greta Thunberg as its Person of the Year was a fitting conclusion to a decade that saw the environment become a concern for the majority of Americans. In 2019, 57% of U.S. adults said they considered climate change a major threat, up from 40% in 2013, according to the Pew Research Center.

In an attempt to curb plastic waste, a growing number of consumers are demanding that consumer packaged goods (CPG) companies rethink how they package their products.

According to survey data from GlobalWebIndex, a market research company, the percentage of shoppers around the world willing to pay more for sustainable/eco-friendly products increased from 49% in 2011 to 57% in 2018.

Manufacturers seem to be listening.

Jenny Frazier, global commercial leader of Nielsen’s innovation business, has seen enough ripples of change in the types of materials used to make bottles of shampoo and dish soap to forecast that a tsunami is coming.

“Product packaging as we know it is going to disappear over the next 10 years,” Frazier said.

Last November, Coca-Cola and two of its bottling partners, Coca-Cola Hellenic Bottling Company and Coca-Cola European Partners, announced new packaging called the KeelClip, which consists of minimal recyclable paperboard material that clings on top and wedges between can multipacks.

The company stated that the new design, a first for the non-alcohol ready-to-drink industry, is meant to replace plastic shrink wrap in all European Union markets by the end of 2021. Coca-Cola anticipates the redesign to save 2,000 tonnes of plastic and 3,000 tonnes of CO2 each year.

With the aim of reducing its use of virgin petroleum plastic by half in the next decade, Procter & Gamble intends to increase its dependence on recycled material. The amount of post-consumer recyclate used to make the company’s laundry detergent brand Ariel, for instance, is scheduled to increase from 25% up to 50% across Europe sometime in early 2020.

“That isn’t necessarily sexy or flashy or something that’s going to jump off the shelf at our consumers, but it plays a critical role in sending a strong demand signal back up the supply chain,” said Jack McAneny, director of sustainability at P&G.

McAneny argued that because of the company’s sheer size and output, even seemingly small changes could play a big role in altering the consumer goods manufacturing ecosystem.

“People aren’t going to invest in collecting and recovering these things unless they know there’s going to be a strong market for them to sell into,” he added.

Not to be outdone, Nestlé recently established the Nestlé Institute of Packaging Sciences—a first for the food industry, the company claimed. The facility, located in Lausanne, Switzerland, is meant to speed up Nestle’s development of new packaging designs and help the company attain its stated goal of making 100% of its packaging either recyclable or reusable by 2025.

“We are pushing our suppliers because we have the feeling they have not really delivered,” Nestlé CEO Mark Schneider told Reuters during a tour of the research center.

S.C. Johnson, the home care products conglomerate, began selling its Windex product in a bottle made with 100% recycled ocean plastic last February. It claims to be the first company to do so with a home cleaning brand.

This upcoming February, the company will go one step further to become the first to incorporate 100% recycled “social” plastic—which is created from products dropped off by consumers and collectors in exchange for money or goods—for the packaging of its Windex line in the U.S. and Canada, according to a spokesperson. The recycled social plastic will be the result of a partnership with Plastic Bank, with the aim of setting up 509 collection sites in several countries, including Indonesia, Thailand, Vietnam, Brazil and the Philippines. 

The collected plastic is taken to a processing facility where it is transformed into flakes, a spokesperson explained. It is then shipped to the U.S., where the flakes are pelletized and sent to a production facility that turns them into bottles. 

The goal of the project is to slow the amount of plastic entering the ocean via collection and recycling, and to reduce poverty by purchasing the plastic from those who collect it.

S.C. Johnson did not disclose exact figures, but noted it saw an increase in sales after releasing the Windex Vinegar ocean plastic bottle.

“As we are working to help solve this issue, we are also working to expand the recycled ocean-bound plastic beyond the Windex line,” a spokesperson said.

Bea Johnson, a sustainability pioneer and author of the book Zero Waste Home, lauds the efforts of CPG companies to sell their products in reusable containers. Packaging made with recycled plastic, Johnson explained, is counterproductive because it does not reduce the amount of material being introduced into the environment. Even when recycled plastic is incorporated into packaging, it still requires a certain amount of new material.

There’s already more plastic than can be recycled, with some municipalities even stopping their plastic recycling efforts, Johnson said, due in part to China’s recent ban on accepting plastic waste.

“If we’re going to use the ocean’s plastic, we should use it for something necessary,” Johnson said, such as the manufacturing of medical products. 

She pointed to glass as a more stable material compared to plastic, as well as metal, paper and cardboard.

One initiative that embraces the idea of reusing containers, as opposed to recycling them, is Loop. Harking back to the milkman of yesteryear, Loop delivers an assortment of consumer goods stored in glass, steel and other reusable containers to people’s doorsteps. The company returns to reclaim the containers, then cleans them, refills them and sends them back out again.

Loop, which debuted in May 2019, is currently being tested in New York and Paris. Procter & Gamble, Unilever, Nestlé, PepsiCo and other well-known CPG companies are official partners.

“This is obviously a big consumer behavior shift, and there will be things we learn coming out of the pilot, but we’re excited about what we might learn,” P&G’s McAneny said about the project.

With the environmental impact of companies under increased scrutiny by institutional investors and NGOs, businesses need to make material changes, not just offer token solutions, said Bruce Winder, co-founder and partner of the Retail Advisors Network consultancy.

He said brands might even be able to find earth-friendly solutions that not only help the environment and appeal to consumers, but also cut costs.

Winder noted that hotels, for example, are embracing wall-mounted dispensaries to reduce small bottles for soap and shampoo. In the process, the program is saving them millions of dollars.

@hiebertpaul Paul Hiebert is a CPG reporter at Adweek, where he focuses on data-driven stories that help illustrate changes in consumer behavior and sentiment.
@RichCollings Richard Collings is a retail reporter at Adweek.