8th Apr 2020
Our industry has seen a huge amount of change in recent years, and we’re faced with even more turbulent time ahead in light of Covid-19. But with challenge comes opportunity, that’s why we decided at the start of this year, and a new decade, to commission our own research into the factors that are affecting our industry to find out what will shape packaging strategies over the next decade.
Sustainability and success are becoming almost interchangeable for companies. Founder of his global fashion brand Tommy Hilfiger declared in 2020:
“Sustainability is something that every brand has to embrace. Because in two to three years if a brand is not sustainable, it will be out of business.”
Elsewhere, the CEO of one of the world’s largest investment management corporations, Blackrock, warned that failing to manage climate-related risks and other harmful actions “will catch up with a company and destroy shareholder value.”
These are hard-hitting statements, and while they epitomise the importance of being sustainable, they also provide insight on the new ‘Green Gap’ trend uncovered by our research.
The growing urgency to be more sustainable can mean businesses do not always realise their positive and genuine green intentions. This is particularly evident in packaging – a poster child for sustainability.
In January 2020, we surveyed 100 senior retail professionals and found there’s risk of a widening gap between packaging sustainability idealism and realism. This is the Green Gap.
Our research found that over half (53%) of companies think reducing environmental impact will be the most important factor defining packaging strategies in the next ten years.
However, when asked which factors will influence packaging design and development in the next decade, more than half (59%) of respondents stated ‘cost’. It ranked in the top three most influential factors, alongside ‘branding/customer experience’ and ‘end of life options’, with little difference between how influential cost is today, compared to its perceived influence in ten years’ time.
The continued high ranking of cost highlights a disconnect between the ambition for packaging to become more sustainable, and the prohibitive constraints of expenditure.
This commoditised approach has limited the opportunity for the wider adoption of sustainable packaging solutions. The past few years have seen a gradual shift in this attitude, with forward-thinking companies looking at the far-reaching efficiencies and benefits of sustainable packaging.
We believe this Green Gap exists because, despite there often being a general agreement within an organisation that sustainability is important, there isn’t always a cohesive approach to putting actions into practice. Businesses are eager to make changes they perceive to be sustainable e.g. material type, without proper consideration of the impact of such changes throughout the supply chain or achieving the full value of the chain by bringing together stakeholders at the initial design stage.
Our Future of Packaging report presents the findings of our research and identifies the trends and challenges faced by industry now and in the next decade.
Cost neutral thinking
Our report presents new evidence and examples of forward-thinking organisations, such as premium lifestyle brand Joules, that have looked beyond the bias of price during packaging procurement, realising packaging spend can equate to value in other areas such as brand loyalty, enabling closed-loop recycling and other fulfilment efficiencies.
Taking a cost neutral approach makes price a secondary consideration, enabling the proper review and trial of different sustainable packaging solutions. This is only possible if businesses move away from such a strong cost-bias during packaging design and development. Testing different options enables companies to analyse how they will impact areas of the business, such as sales and customer satisfaction, and make more informed decisions as a result.
Environmental policies must be more progressive
The findings of our research show government policies will also prove more influential in shaping packaging design and development, with over a third (37%) of respondents stating that government policy will have a lot of influence in the next ten years, compared to only 23% today. This marks a significant change in levels of perceived influence, and while this is understandable, it also risks bottlenecking packaging sustainability and widening the Green Gap identified.
Overcoming plastic paranoia
Our research found that 61% of businesses believe ‘end of life options’ will be the most important factor influencing packaging strategies in the next decade. This marks a considerable change from current levels of 43%.
We strongly believe that companies need to address the consumer confusion on plastic and leverage this opportunity to educate about the ‘good’ plastics that preserve products, offer convenience and can be recycled, versus ‘bad’ plastics that add little to the consumer experience. Without doubt, clearer communication is needed to inform companies so they can help customers to change behaviour and end this culture of plastic paranoia.
Bridging the Green Gap
The Future of Packaging Report shows where the opportunities lie for businesses to be transparent about cost, policy, and materials used in their packaging.
By taking a collective approach with suppliers and departments within your organisations to find ways of improving your packaging’s sustainable credentials, Duo UK is confident companies will find commercially viable solutions that don’t cost the earth to close the Green Gap that currently exists.
We hope this report offers valuable insight for your brand and the choices you make with your own packaging strategies both now and in the future.
With thanks to those who shared their industry insight, including DHL, Regatta Ltd, Joules, Make UK, Flourish CSR Consultancy and Comply Direct, on how we can all play our part to improve packaging sustainability in the next decade.
Download your free copy of the Future of Packaging report here