Why Your Brand Needs A Sustainable Packaging Strategy (And 5 Startups That Can Help)
Look around. How many items in the room you’re sitting in right now came in some kind of plastic packaging? Chances are most of them. Plastic has long been the go-to material for packaging thanks to its low cost, durability, and convenience.
But that’s a problem. 40% of plastic is used only once and then discarded, where about 8 million tonnes of it finds its way into the ocean every year — polluting water and killing wildlife. And it’s not just the oceans— 80% of our drinking water is contaminated with microplastics. However you look at it, we’re in a plastic crisis.
And consumers agree. According to GMA, 86% of Americans agree that we’re facing a global plastic and packaging crisis. They’re looking to brands to lead the way when it comes to developing a sustainable packaging solution – and they’ll support them for doing so:
- 87% of consumers have a more positive image of a company that supports social or environmental issues.
- 88% of consumers said they’d be more loyal to a company that supports social or environmental causes.
- Over 70% of consumers would pay an average of 35% more for eco-friendly brands.
Turns out consumers want brands that embrace purpose and sustainability. So a sustainable packaging strategy is good for the environment, good for consumers, and good for your business.
Beware The Quick Win
Turns out quitting our plastics habit is harder than it seems. That’s because it poses particular challenges around:
- Disrupting traditional and entrenched supply chains
- Introducing new materials at scale
- Going green in a way that won’t drain consumer’s wallets
Companies have tried in the past, but there have been a lot of sustainability failures out there (anyone remember the Nike Air “Hobbits”?). Some of these initiatives failed because they were quick or sloppy fixes that didn’t really fix anything. Others didn’t consider the needs of their consumers. And others were downright misleading.
That doesn’t mean it’s not a challenge worth taking on. It means brands need a sustainable packaging strategy that goes beyond quick wins to move the needle on the plastic crisis in a way that’s also good for business.
These ambitious goals will require new recyclable, compostable or reusable packaging technologies to meet the scale of the CPG industry. In our roundup below, we’ll explore five startups using everything from seaweed to reusable aluminum to help eliminate the CPG industry’s reliance on plastic.
5 Sustainable Packaging Startups To Watch
In 2019, Swedish provider of paper packaging materials launched a Paboco joint venture to develop a paper bottle that would be fully recyclable and biodegrade in nature. A few months later, they announced the creation of the Pioneer Community, a collection of big name brands like L’Oréal, Absolut, and CocaCola that will work together with the aim of developing and scaling “a fully bio-based, recyclable bottle made of renewable materials,” according to Bioplastics News.
Earlier this fall, Paboco and Absolut launched a prototype for a paper bottle made from recycled paper and a 100% recycled plastic liner. While the bottle still uses a recyclable plastic liner, the hope is to eventually move to a bio-based liner once the technology is available. But, for now, the company is prioritizing research and working with materials that can fit into known recycling streams, according to Beverage Daily.
“Getting these bottles into testing and one milestone step closer to consumers, demonstrates the power of co-development and the joint drive to create lasting, sustainable, industry change.” says Michael Michelsen, Business Development Manager at Paboco.
Loop – from the founder of TerraCycle — is a new startup that hopes to encourage zero waste shopping by selling all your favorite products DTC in reusable packaging.
How it works: you shop for your favorite products online, paying for the product itself and a refundable deposit on the packaging, which is usually a durable metal or plastic. Your order then arrives at your home in a reusable Loop bag. When your product — be it ice cream or laundry detergent – runs out, you toss the package back in your Loop bag. When you’re ready, the bag gets picked up, the containers are all professionally cleaned, and your deposit can be used towards your next order.
Loop launched as a pilot in 2019 and saw a huge growth in demand during the Covid-19 pandemic. It’s now expanded service nationwide and has partnered with big names like Kroger and Walgreens, which eventually plan to offer items in stores.
Notpla creates packaging made from a blend of seaweed and plants with the goal of helping brands develop a plastic-free customer experience. Notpla material is not only biodegradable but also edible and endlessly flexible — it can be used as packaging, liners, or films to package dried goods.
Notpla’s plastic-like casing is biodegradable within six weeks, according to the company (as compared to the hundreds of years it takes regular plastic to break down). Last year, the material was even used to package edible water pods during the London marathon, cutting down on the amount of garbage that ended up on the streets during the race and proving that sustainable packaging solutions can be used at scale.
Algramo is a self-service, cashless, and touchless way to buy and refill your favorite cleaning products.
After downloading the app, you visit an Algrama smart dispensing machine to pick up your smart reusable packaging. Each container has a built-in RFID chip that acts as a digital wallet every time you use the machine. You then pick your favorite product and refill your smart package at a discounted price. This reduces single-use plastic and saves consumers money.
Algramo launched in Chile in 2012 with the goal of helping millions of low-resource families avoid the poverty tax, the premium they pay to purchase products in smaller formats (and which often means they’ll end up paying up to 40% more in the long run). Through a partnership with Unilever, Algramo enabled families to buy the exact amount of product they needed at a bulk price.
Recently, Algramo was selected to join the Circular City Studio, which empowers urban tech startups to help make New York more equitable, livable, and resilient. Right now, Algramo is in the early phases of a pilot program in the US with refill stations located in New York City.
Sulapac was founded by two biochemists on a mission to create a more sustainable alternative to plastic. Sulapac — the result of their research — is a fully biodegradable material made from wood chips that can be processed using existing plastic product machinery at a similar cost.
So far, Sulapac has been used to produce everything from cosmetics packaging to a microplastic-free, marine degradable, and mass-producible straw.
By focusing not just on the product — a biodegradable replacement for plastic — but also giving equal weight to the process and cost, Sulapac was able to create a material that’s not just superior, but also has a more realistic opportunity to be as useful and scalable as plastic.
Sustainable packaging is no longer just an outlier. Big industry players like Nestle and Unilever have made ambitious commitments to reduce their reliance on plastic and move to have 100% recyclable packaging by 2025.
More money is flowing into sustainable packing startups than ever before. In the last few years, the top 20 startups attracted over $850 million in funding. And these brands are focusing on the levers that will make sustainable packaging solutions a reality:
- Can be created using existing plastics machinery and infrastructure
- Can be produced at a comparable cost to plastic
- Saves consumers money
- Proven to be scalable
- Gives consumers access to all their favorite products
Packaging waste, which accounts for about one third of municipal trash, costs local governments billions in disposal costs every year. It then becomes a huge environmental problem and public health crisis when it fills our oceans and waterways.
The Win Win Win:
A sustainable packaging strategy will benefit the environment, drive consumer loyalty, and be good for your brand. Count ’em, that’s a win win win.