Sustainable Packaging Pressure On The Rise: How Should SA Brands Respond?

As consumers around the world embrace a “reduce, reuse, recycle” lifestyle, brands need to relook at their product packaging decisions. Is sustainable packaging a sustainable strategy in our current economy?

What are we looking at in 2020?

Climate change and higher social consciousness (and with that, legislation) will continue to be the driving force behind many product manufacturers’ packaging and product lifestyle choices.

Globally, most of what we have seen in the packaging industry so far will continue. Packaging that is designed for recycling or reuse, minimalised (even removed), made from mono-materials, replaces plastic with biodegradable alternatives, or otherwise lends itself to circularity will stay.

There’s going to be huge demand for products with packaging that is made from recycled material or 100% recyclable. Plant Starch Material (PSM) will grow exponentially. Edible packaging is also set to rise.

We will see more minimalist and clean design, and more than likely the use of Augmented Reality (AR) to maintain a clean-look while educating consumers.

What Does This Mean For South Africa?

SA brands will do their best to keep up with global standards, but their success in doing so will all come down to affordability (for brands) and infrastructure.

Despite the best intentions to save the planet, the practicality of adopting sustainable packaging—amongst FMCG brands, specifically—can be, well, challenging.

Even though 2020 will kick off the 10-year count-down of our country’s zero-waste to landfill agenda. Sure, industry regulations will enforce change to a degree but, without proper incentives in place, manufactures may still find loopholes to keep their costs low.

The True Costs to Consider  

Earth-friendly packaging technology has taken giant strides, but it still comes with a hefty price tag. Manufacturers are pressed for margins, so the cost is usually transferred to the retail price. This doesn’t bode well for the price-sensitive customer needing groceries and everyday household items. They’ll simply find more affordable alternatives.

One thing we can’t deny is that climate change is REAL, it begs the ethical question of producers’ responsibility to the planet before shareholders. After all, what good would the product be if there is no one left to buy it? Consumers know this too.

Brands need to consider if saving money (and retaining cash-strapped customers) in the short-term outweighs the toll on the planet and potential lost revenue from socially-conscious consumers.

Packaging Is a Bigger Part of the Purchasing Decision than Ever Before

As far as economic groups go, pressure towards brands “upping their packaging game” stems mostly from the upper-middle class and above, who can afford a few more Rands. However, there’s a fair few in lower SEM (Socio-Economic Measure) groups who, too, are prepared to pay a bit more for responsibly produced goods¹. For one reason.

Emphasised: It’s not about income. It’s about age!

Millennials are driving the cause for change. South Africa’s median average age is 35 years old. These are people who expect brand participation in sustainability.

Forbes reported that millennials are typically more risk-averse and are thus more frugal, but when they choose to part with their money, it is with “corporations and brands with pro-social messages, sustainable manufacturing methods and ethical business standards.”

Here at home, a Broll research report focused on the non-sustainable use of plastic within the South African retail environment echoes this sentiment¹.

Alas, retailers, too, are pushing the agenda. In their attempt to grow market share among millennials, retailers are changing the game in favour of eco-friendly products. So the more retailers give customers what they want the less propensity they have to purchase from you if you can’t keep up.

Innovation Is Key To Finding A Middle Ground

When starting out, don’t worry about having enough money; limited funds are a blessing not a curse. Nothing encourages creative thinking in quite the same way.”— Sir Donald Gordon

We understand the cost implications for brands, especially while emerging technology remains expensive. At the same time, we also know that not adopting sustainable, low to zero environmental impact solutions will cost market share. For this reason, we believe that out-the-box (pun-intended) thinking holds the key.

Consider the mantra “positive impact on the environment and customers”. Perhaps the best way your brand can win the hearts of the customers AND benefit the environment is to foster a culture of circularity. Through reverse logistics and a powerful marketing message, you can ensure that your already recyclable packaging averts landfills and renders your product lifecycle.

Some brands rely on layered plastic and aluminium packaging to protect the integrity of their product, but the technology to separate these layers doesn’t yet exist, rendering the material unrecyclable. That’s not the end of the road – it’s an opportunity. Sponsor the research that will make that technology a reality. Use real-estate on your packaging and include customer education in your design. Develop a marketing campaign to grow awareness of your commitment to problem-solving. The returns will be abounding.

Before making any drastic changes to your packaging, contact Market Instinct. We specialise in evaluating consumer response to proposed new packaging ideas and designs. Contact us for more information

Attribution:

¹ “In fact, transparency is so important to consumers today that they are said to be willing to pay more for products that are viewed as being socially, ethically and environmentally responsible.” Source: http://www.engineeringnews.co.za/article/the-future-of-plastic-in-sas-retail-environment-2019-08-13/rep_id:4136

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