The Method Method: Green, Nimble and Disruptive

The Method Method: Green, Nimble and Disruptive

You've probably seen Method cleaners -- they're on the shelves at retailers large and small, including Costco, Home Depot and Fred Meyer. But it's almost as likely that you've noticed their eye-catching, unconventional-looking containers without realizing just how green the products within are.

Founded by two innovators who describe themselves as "people against dirty," Method designs all of its products to meet rigorous environmental sustainability standards, both for those stylish containers and the cleaning products themselves. The company maintains dueling lists of "clean" and "dirty" ingredients to guide their development, and will work with suppliers to create brand-new, environmentally friendly chemicals to keep homes clean. In the process, the company has uprooted the old ways of thinking in the $15 billion cleaning-products industry.

I spoke with Joshua Handy, Method's senior creative director, about how being small, nimble, and always keeping an eye on sustainability, has made the Method method a success.

Matthew Wheeland: Josh, thanks so much for taking the time to talk. The first question I have is really just about the genesis of Method. What did the shelves of your local Safeway look like in 2001 when the company started? What direction did the company set out hoping to shift it to?

Joshua Handy: Well, I think the thing that the founders noticed when they set about thinking about starting Method was that in many categories in CPG, all the competitors are really closely aligned to each other. So it's almost as if everyone is sort of copying what everyone else is doing. So they felt that everyone was really talking about problem solution in a really basic way. So no one was really talking about the experience of cleaning. And it kind of seemed to them that people had been sold this bill of goods where cleaning was this terrible chore. And it really didn't need to be like that. It could be something that was actually quite pleasurable.

MW: Method products stand out immediately from when you first see them. And then as shoppers get more into it they learn about the environmental benefits and all that. Have you seen any shift in what neighboring products look like? Is there a trend to a little more thoughtfulness in design of cleaning products?

JH: So one of the things we set out to do was to disrupt these really boring categories that we're in. So now the key way that we do that is we try to bring this combination of both style and substance to the categories. So the style of Method is all about getting people to notice the product, pick them up, get engaged in them, use them, get pleasure from using them, want to use them again. The substance side of it, which is a deeper story, is all about how green they are, how good for the environment they are, how they are non-toxic and don't add toxins to your home and that type of stuff.

Now, I think what the genius of Method is that we don't ask people to sacrifice to be green. You know, a lot of the green products out there they kind of either don't work as well or are very kind of -- they have a certain look, which I think is kind of pretty ugly. What we're trying to do is to not make people think about sacrificing either performance or how the bottles look or how the product looks to get what they want.

And I think people are starting to realize as green has become more and more mainstream that just being -- having a green product out there just kind of makes you part of the noise. So it's kind of -- it's becoming more and more the price of entry into the cleaning category that you have an environmentally sensitive solution. Once you're there then you ask yourself, "Well, now what?" Everyone kind of had similar amounts of effectiveness. Everyone is kind of green. You really gotta start looking at more higher order benefits than those to make your products stand out and have a really sort of sustainable and competitive advantage as everyone else.

So over the time we're seeing as people enter into these categories and their own brands mature or they see Method taking market share from them, they're sort of -- a lot of them have responded by making their products more aesthetically pleasing. Paying more attention to how the consumer uses and lives with the product in their home rather than just looking at the solution -- the problem solution. The, "I've got a dirty countertop I need to clean up." Sort of moving beyond that into more sort of experiential realms.

MW: And one of the best examples of the effect that Method has had is with the ultra concentrated laundry detergents, where your company was the first to introduce that and how everybody is doing it.

JH: Yeah. That's a huge green story for us actually. We often talk about that. We managed to move an entire category in a way that makes the category itself a far more green and sustainable sort of part of the department or the supermarket now. So as you said we were kind of the first to introduce three times concentrated laundry detergent probably -- I think it was back in 2004. Quickly sort of copied by -- well, copied is sort of a strong word, but others moved into the space.

And the reason they did is because it makes so much more sense that what was currently on the market in the sense that the bottles become smaller. The amount of water you're shipping around the country becomes smaller. It's easier to use. The consumer finds it easier to use. There's so many wins there that translate from doing that. And the wins are often -- can be thought of as environmental ones.

I have a calculation somewhere, which tells you the amount of plastic and the amount of water that were taken out of that whole manufacturing system by making that change and how that's kind of been multiplied when the really big players decided to get on board with concentration.

MW: Absolutely. And you've said a bunch of things that I want to touch on. I think first and foremost this idea that these innovations are just bubbling under the surface and all it takes is one company to successfully market a product like this and it takes off. What do you think is behind this receptiveness to new ideas? Is it growing environmental awareness? Is it something else entirely?

JH: I kind of think that the established players in these categories tend to not want to do anything. They tend to want to keep the status quo. It's -- they don't really do things like design very well, innovation very well on a packaging front so they seem to have vested interests in not doing anything. And so what that allows -- and they all sort of buy into this kind of group think. If one company does one thing the other one will match it.

So they always kind of think incrementally in terms of their innovation rather than aim for a breakthrough. And I think that it's easy for small companies like Method to enter these spaces with what might be just a slightly different idea. You know, you're not really reinventing anything here I don't think. We're really just taking a fresh look. And we don't have any of the encumbrances that a vertically integrated company -- forward company might have with factories and raw material supplies all kind of bought in advance and unable to be changed.

Method doesn't own any factories, and isn't vertically integrated, and we have lots of contract manufacturers, which allows us to be very nimble and try lots of things and learn from our mistakes and really try and be as disruptive and be the alternative in these categories.

MW: That's something else that I want to talk about, which is what sort of tools do you find useful in designing these products?

JH: The way that Method tends to approach these things is that we have two kind of starting points. One is through research we do with consumers to try and understand how they do things like consumer -- it's called consumer insight. And trying to figure out what's the insight that we can leverage from what the consumer is doing to reinterpret a boring category or a boring product.

The second thing we do is we have very detailed "dirty list." And what these are are these are ingredients and materials that we won't use in any of our products. And we have a corresponding clean list. A clean list from the chemical side and what we call a green card on the packaging side where we -- we'll have chemicals and packaging things that we want to use. And all our packaging designs, all our bottles and secondary packaging is scored on this green card depending on all the different green parameters that we can think of. And they get this score, which helps guide our bottles -- our design selection and design direction in how we're gonna solve a particular problem

So we have all these type of checks and balances built in really early in the process that help guide our designers to sort of always coming out in the right sort of way. So for example is we have a number of different design concepts for packaging, we'll score them using the green card. And it's difficult to argue that, all things being equal, we should use packaging with a lower green score if there's a higher green score packaging option out there that we can use. So those two things, the consumer insight thing helps them form how we approach a project, and the green card and the clean and dirty lists allow us to solve for that consumer insight in an environmentally friendly way.

MW: And just how green do your green products -- or any green products, really -- have to be to be considered green? You mentioned both the packaging and the contents. Is there a balance you have to strike or is it as green as possible across the board?

JH: It's kind of interesting. Method is a company that believes that you can only affect change -- and we're about affecting change as our company mission -- only if you can do it in a for-profit sort of way. So there's definitely a commercial side to Method that shouldn't be underestimated. And the other side of that, you know, if we can't achieve what we think is either a high performing green product as in the chemical or a high performing green package to deliver that product, we just won't do it.

So we do have minimum benchmarks that we must meet in order for a product to be considered viable for us. An example for us is that we just launched a couple months ago our toilet bowl cleaner called Little Bowl Blue. And it's -- and for years we've talked about doing a toilet bowl cleaner, but we could never do it satisfactorily because of the chemical -- we couldn't find a chemical solution that would work for us. Because the chemicals in toilet bowl cleaners are really toxic.

And it took us a long time to develop organic acid solutions that would work not only as good as the green players, but as good as the market leading sort of standard players in that category. And so once we reached that point we were free to sort of move forward and launch that product. But it took four years of development before we got that thing working properly. We could have launched an inferior product years ago, but we held off because it just wasn't gonna be effective enough or it wasn't gonna be green enough.

MW: So it sounds like there may be a big drawing board of Method products that are nice to have, but not yet ready for primetime. Are there things that are just waiting in the wings...

JH: Oh yeah. We have loads of things. And actually when I come to the conference I'll bring a bunch of interesting things that we've been developing internally that will kind of show how if we can't find the solution that we want we'll start working with our suppliers to actually develop first and that will allow us to launch products that no one else has been able to do. Things like -- example -- a good one of this is that we've just been developing -- these types of products you can buy in these little plastic pouches like wipes for cleaning your baby or for cleaning your counter.

I don't know if you've seen these before, but it's a real dilemma for us because these little plastic pouches really are a much better ecological story than a bottle is or like a wipes container like a Clorox wipe container is. But they're not recyclable. And one of our requirements for Method products is that they be recyclable or be able to be recycled. And so it's really conflicting for us because even though they're a better environmental solution in the sense that they use very little material. They use much less energy to make. Because they're not recyclable, these pouches we could never use them.

And the reason they're not recyclable is that because these pouches are made of plastic film in multiple layers and they have the different plastic films married together to make these layers of material. Which means you can't actually recycle it because it has different materials stuck together. You can't separate them out into their constituent materials. So even though it's a really great environmental story in some respects, because it's not recyclable you can't recycle it.

So what we have done is we have worked with suppliers to create this material -- this film material that's all one material. It could still be made into these pouches and footment. And it has this plastic component in it that's actually the same material as the pouch, which is all polypropylene. Which makes it all one material, which means it can be recycled.

Now, they're not currently recycled in America, but in other places they are. But it's a much better solution than having something that's not recyclable. So now we have a pouch that uses very little energy and material to make and is completely recyclable. Now we just have to work on the municipal recycling depots to make sure these can be recycled -- that they'll actually recycle it. So it's kind of like a progress not perfection situation. But we're kind of getting it to the point where it's gonna be a really great product.

MW: Great. And moving from the manufacturing or design side to more of the other end of the chain to shoppers and people looking from the outside in. Method products are designed to appeal on two levels, environmental level and the aesthetic level. Do you have a read on whether either of these two aspects is drawing shoppers in more than the other?

JH: Very interesting question. It's without question that the aesthetic side of it is how people typically enter Method products. And this is a conscious decision on behalf of Method to really amp up that side of the product experience. Because if you look at the category of cleaners, of chemical cleaners, it's a -- the size of the entire business in the States is about a $15 billion category. But the size of green cleaners within that category as a subset is only 1%. It's only $150 million.

So if you're perceived as a green cleaner, you're immediately cutting out 99% of people who are gonna be interested in buying your product. So in order for Method to be effective and really start this revolution that we're trying to do, you've really go to appeal to the mass market in the same sort of way as every mass market brand works. And that is through curbside appeal and through performance. You really can't sit on the idea that green's gonna get you there. It just isn't gonna work.

MW: It's almost like you're trying to sneak a green product into someone's shopping cart. Is that a response to the perception that green products are generally a form of suffering, that green products don't work quite as well as conventional products?

JH: Yeah. I think that it's kind of an interesting way of putting it. We don't really -- we see green as just one of the qualities of the brand. We don't see it as the defining aspect of the brand. It's the philosophy if how Method does business. But it doesn't mean that -- we're not trying to make people feel like they have to sacrifice things to be green. So it's not the be all and end of all of Method.

Although we're an incredibly dark green company on the inside, we try and be only light green on the outside. You can peel these layers back in Method and get deeper and deeper into how we approach our products in terms of sustainability and cradle to cradle. And it goes right to the very core, to the very founders. Our philosophy's there, but you don't need to be ramming that down people's throats. You know?

Green products -- green is like quality: it's kind of one of these things that should be inherent in every product out there. So we don't feel you can really hang your hat on that and compete solely on being green. So it's there for people who like it. And if people just like how the products look and how they work that's also great for us too.

MW: Josh, thanks so much for taking the time to talk.

JH: Okay. Thanks. Nice talking to you.