The future for refillable packaging

Few busi­ness­es can rival the 2020 pan­dem­ic suc­cess of Loop. Such has been cus­tomer demand that the inno­v­a­tive, online refill­able pack­ag­ing ser­vice has just opened across all forty-eight con­tigu­ous US states, up from a mere nine when it launched in May last year.

Loop, which is also avail­able in the UK and France, is fast becom­ing the poster child of a reusable pack­ag­ing trend that is spread­ing glob­al­ly as con­sumers increas­ing­ly seek out alter­na­tives to sin­gle-use plas­tics.

“From the con­sumer demand we’ve seen around the world, the growth of refill and reuse mod­els promis­es to be extra­or­di­nary,” says Stephen Clarke, head of com­mu­ni­ca­tions for Loop Europe.

New companies closing the loop

In addi­tion to its eco-friend­ly cre­den­tials, Loop has devel­oped an ecom­merce plat­form where con­sumers can buy house­hold brands – prod­ucts from Ecov­er, Danone, Coca-Cola and Nivea are among those on offer – rather than flog­ging its own-brand (read less trust­ed) alter­na­tives.

The sys­tem works like any oth­er online shop­ping expe­ri­ence: you log on, select your item and pay. The dif­fer­ence is your prod­ucts then arrive in a recy­clable padded con­tain­er – the Loop Tote – which acts like a recy­cling bin. In go the emp­ty bot­tles and then, cour­tesy of one of Loop’s retail part­ners – Tesco in the UK, for instance – back they go to Loop’s par­ent com­pa­ny Ter­ra­Cy­cle for recy­cling.

The strong prod­uct val­ue that con­sumers expe­ri­ence via Loop helps build on people’s grow­ing will­ing­ness to try solu­tions that tack­le the waste­ful­ness of sin­gle-use pack­ag­ing, says Tim Debus, pres­i­dent and chief exec­u­tive of the US-based Reusable Pack­ag­ing Asso­ci­a­tion.

“Active sup­port and par­tic­i­pa­tion from con­sumer prod­uct brands and retail­ers are key ingre­di­ents to cre­at­ing prod­uct val­ue and con­nect­ing with con­sumers on the pos­i­tive expe­ri­ence,” he adds.

A report last year from the Ellen MacArthur Foun­da­tion cites 69 refill­able pack­ag­ing ven­tures in mar­kets around the world, from water refill vend­ing machines, such as Dasani’s pilot Pure­Fill sta­tions, through to deposit-return schemes like the refill­able gas cylin­der ser­vice offered by sparkling water ven­ture SodaS­tream.

3 steps to refillable packaging: test, learn, refine

Glob­al con­sumer good giant Unilever is one of those get­ting in on the act. In addi­tion to pro­duc­ing some refill­able ver­sions of its own best-sell­ing brands, like a con­cen­trat­ed ver­sion of its Cif bath­room clean­ing spray, it is part­ner­ing with oth­er reuse spe­cial­ists to help them scale.

An illus­tra­tive exam­ple is its sup­port for Algramõ in San­ti­a­go, Chile. The start­up uses elec­tric tri­cy­cles to deliv­er a selec­tion of Unilever’s home­care prod­ucts to people’s homes. On arrival, the prod­ucts are dis­pensed into return­able con­tain­ers by an auto­mat­ed dis­pens­ing unit, which is con­nect­ed to an app that allows users to place their order and pay vir­tu­al­ly.

“There isn’t a one-size-fits-all solu­tion. To deliv­er a range of options that work, we con­tin­ue to adopt a ‘test, learn and refine’ men­tal­i­ty,” says Richard Slater, chief research and devel­op­ment offi­cer at Unilever.

Hit­ting on the right answer promis­es lucra­tive rewards. If just one fifth of exist­ing plas­tic pack­ag­ing were to be replaced by reusable or refill­able alter­na­tives, it could open up a $10-bil­lion busi­ness oppor­tu­ni­ty, the Ellen MacArthur Foun­da­tion esti­mates. PepsiCo’s 2018 pur­chase of SodaS­tream for $3.2 bil­lion offers an inkling of the mon­ey at stake.

The eco-con­cerns and gen­er­al adapt­abil­i­ty of younger con­sumers put them in the van­guard of the refill­able pack­ag­ing move­ment. A study of 2,000 16 to 24 year-olds by mar­ket analy­sis firm Glob­al­Da­ta late last year found that more than two-fifths (44 per cent) had used a refill sta­tion in the pre­vi­ous 12 months.

Examining the “COVID effect”

The coro­n­avirus pan­dem­ic has had a “damp­en­er” effect on some ini­tia­tives, as con­sumers return to sin­gle-use pack­ag­ing due to hygiene con­cerns, Emi­ly Salter, retail ana­lyst at Glob­al­Da­ta, con­cedes. She gives the exam­ple of Waitrose’s deci­sion not to extend its pop­u­lar Unpacked tri­al, which has seen a ded­i­cat­ed refill­able zone and a frozen goods pick-and-mix option intro­duced into four pilot stores.

Help­ing off­set health con­cerns, how­ev­er, has been the huge appeal of doorstep refill­able ser­vices dur­ing lock­down. Algramõ, for exam­ple, which also dis­pens­es a pet food brand for Nestlé, report­ed a 356 per cent increase in demand between April and June while San­ti­a­go res­i­dents were con­fined to their homes.

Welsh start­up Splosh expe­ri­enced much the same. The con­cen­trates spe­cial­ist, which sells a range of home essen­tials, from show­er gels to toi­let bowl clean­ers, has seen demand for its sub­scrip­tion-based ser­vice peak in recent months. “At times, we’ve strug­gled to cope with demand,” says the firm’s founder Angus Gra­hame.

Is ”ease” the answer?

Anoth­er rea­son behind the suc­cess of Splosh and oth­er refill­able ser­vices like it comes down to one word: ease. A small minor­i­ty of con­sumers are moti­vat­ed enough by envi­ron­men­tal con­cerns to go the extra mile to lim­it their use of plas­tic pack­ag­ing, says Annette Lendal, a cir­cu­lar econ­o­my expert at the Ellen MacArthur Foun­da­tion. Most, how­ev­er, are not.

Mak­ing refill­able pack­ag­ing easy to use, there­fore, is crit­i­cal. In Splosh’s case, it has designed a deliv­ery pack­age (recy­clable of course) that allows it to post its prod­uct con­cen­trates through con­ven­tion­al let­ter­box­es, avoid­ing the need for cus­tomers to be at home.

Dig­i­tal tech­nol­o­gy is also mak­ing refill­ing eas­i­er for cus­tomers. UK cam­paign group City to Sea, for instance, has devel­oped an easy-to-use app that iden­ti­fies the 20,000 or so loca­tions where peo­ple can fill up their water bot­tles for free.

“All our cam­paigns are root­ed in behav­iour change the­o­ry that will inspire, nudge and pro­voke peo­ple into tak­ing action on tack­ling plas­tic pol­lu­tion. Mak­ing an action easy for peo­ple to do is absolute­ly a core com­po­nent of this,” says cam­paign man­ag­er Steve Hynd.

In a sim­i­lar vein, this sum­mer it launched a cam­paign for the rein­tro­duc­tion of reusable cups and con­tain­ers by cof­fee shops and food out­lets, many of which desist­ed from doing so for health rea­sons after COVID-19 hit.

Oth­er ven­tures are exper­i­ment­ing with con­sumer incen­tives to win over every­day pun­ters. Chile’s Algramõ, for instance, offers loy­al­ty rewards for reusing its pack­ag­ing, recoupable via its dis­pens­ing machine. UK organ­ic food retail­er Abel & Cole, mean­while, throws in a free­bie to loy­al cus­tomers, offer­ing the tenth refill of the same prod­uct with­out charge.

The future means aiming for mainstream

Refill­able schemes can be as easy and attrac­tive as pos­si­ble, but too many still focus on the pre­mi­um end of the mar­ket, says Lendal at the Ellen MacArthur Foun­da­tion. The trend is under­stand­able. Refill­able options not only require rejig­ging stan­dard pack­ag­ing design, but also a re-engi­neer­ing of how prod­ucts are dis­pensed, deliv­ered and returned; so-called reverse logis­tics.

The trick is to ditch bespoke solu­tions, she says, and instead invest in stan­dard­ised reusable pack­ag­ing that is phys­i­cal­ly robust, sim­ple to clean and inter­change­able between brands.

“To reach the main­stream, we need to look beyond pre­mi­um designs and focus on plain­er, more stan­dard­ised pack­ag­ing. The big brands get this and it’s some­thing I think we’ll now start to see increas­ing­ly,” Lendal con­cludes.