Best for the bottom line: Sustainable packaging wins customer loyalty
This article is sponsored by Asia Pulp & Paper.
Businesses today understand that having a clearly structured and attainable sustainability model is becoming a necessity, and no longer simply a "nice to have." How this takes shape will differ for every company, but ultimately brands understand that sustainability can be a strong value proposition. And for those in the consumer product space, a critical part of committing to sustainability is doing so with the first part of the product the consumer interacts with: packaging.
According to new research from the Asia Pulp & Paper Group (APP), more than half of Americans consider packaging waste an environmental issue, and nearly one in three consumers agree they are more likely to shop with a brand that offers products in sustainable packaging over brands that don’t offer such options.
While sustainability is not a new conversation, it’s certainly a growing one. The APP research also found that compared to five years ago, sustainable packaging today is more important to half of all Americans. This sentiment points to why more consumers are looking to companies to get creative and adopt new packaging solutions that reduce waste, make recycling easier or be biodegradable when being made recyclable isn’t an option.
Food packaging is an area where this growing consumer demand is clear, especially given the upward trend in delivery services for grocery goods and meal delivery services such as Blue Apron and Hello Fresh. Individuals spanning all demographics interact with food packaging on a daily basis. The ways in which these products are packaged can affect not only the quality of the product, but also the price and the impact on the environment. This is particularly true of frozen foods that are expected to maintain freshness over a long period.
When considering what aspects of food packaging make an impact on purchasing decisions, 46 percent of consumers surveyed listed sustainability as an important factor. Brands that focus on implementing smarter, more sustainable packaging will be fulfilling this demand, in addition to eliminating wasteful practices.
One example of this is Hershey, which recently announced a refreshed approach to its packaging – creating simpler, single-piece display packaging that uses 32 percent less corrugate. This helps the company maintain its commitment to the American Business Act on Climate Pledge, in which Hershey hopes to reduce packaging materials by 13 million pounds by the end of 2017.
As Hershey has done, many brands are (rightfully) treating the use of eco-friendly packaging as an important value proposition. Sustainability requires thinking long-term and considering not just where a business is now, but where it would like to be in five, 10, or 20 years to meet these growing consumer demands.
And once goals have been set, maintaining sustainable production involves a daily commitment to testing new innovations, monitoring the production line and keeping a keen eye on the supply chain to ensure each step in the process meets the same standards identified by organization leaders. At APP, this means bringing everyone in our operations into the sustainability fold — from manufacturing to converting to the point of sale — and making sure the end product helps us achieve the goals set forth in our Forest Conservation Policy.
Now, the move toward sustainable packaging is becoming an even greater benefit to the bottom line, with 52 percent of consumers willing to pay more than 10 percent more for products with sustainable packaging, and 28 percent willing to pay up to 30 percent more. This is especially true of millennials, who indicated they are twice as likely as older demographics to spend more for sustainable products, shedding new light on the future of brand loyalty.
While many may split on the finer details, consumers agree that the use of paper products is still high in this digital age — and all, on some level, are paying attention to where the industry is moving. Each year, we see the trend toward consumer demand for sustainable packaging options grow at the same time we see the food industry changing their approach to how products land in consumers’ homes.
To prevent falling behind and becoming the brand customers associated with missing the mark on environmentally friendly practices, companies need to make a transparent and earnest attempt to incorporate sustainable packaging processes into their overall value propositions.