Why I’m raising my ambition when it comes to making more sustainable products
Sustainability sells. The evidence shows that growth in the Consumer Packaged Goods (CPG) sector is being driven by products that are marketed as more ‘sustainable’.
But as I begin building a new range of bath and body products for babies and kids, I’m increasingly aware that there’s a choice to make about where sustainability fits in the fundamentals of product innovation.
Yes, sustainability sells, but each brand faces a choice. Are you selling cosmetic changes to meet on-trend demand, or are you using the constraint of sustainability to rethink how products in our day-to-day lives can be fundamentally redesigned?
It’s possible to build a great brand that defines itself by its sustainability messaging. The ‘More sustainable version of brand X’ business model is a much used approach to the sustainability challenge.
The appeal of these types of brands is to customers who already believe that businesses should address the challenges of climate change or resource consumption. Historically that was a small niche, but it worked. It led to the success of brands like Seventh Generation or Patagonia. They won because they captured the purchasing power of customers who believed in the issues of sustainability that they addressed.
Today, where sustainability as a point of concern is more mainstream, this business model is more widespread and its potential customer base is larger . Companies are updating their packaging, reducing their commitments to single-use plastics and talking about reducing their environmental footprint. It’s not uncommon to find a “we’re more sustainable” message stuck on many mass market product.
It’s also clear that customers now expect brands to at least acknowledge what they’re doing to address their sustainability concerns. As I’m reviewing a range of packaging solutions to work out how to deliver body and hair washes and moisturisers to customers in a more sustainable way, I’m bombarded with messages from packaging suppliers that tell my why I need to be thinking about sustainability — “It’s what customers demand now!”
The problem however, is that this approach can treat sustainability as a fashion choice, rather than an opportunity for genuine innovation. If your motivation is to keep up with consumer trends then you’ll offer customers pink hoodies when there is a fashion trend for pink hoodies. In the same vein, if customers want more ‘sustainable’ products, you’ll offer them enough to convince them of your sustainable credentials — using recycled PET packaging and telling them you’re the more sustainable choice vs competitors.
Of course, meeting a consumer need or wanting to catch a fashion trend, can be a compelling reason to change or update a product. After all, it is the consumer who you’re trying to sell to. There’s also no doubt this will slowly move the world towards a more sustainable use of resources. It’s currently driving much of the tinkering that will make packaging and ingredient lists more sustainable as brand look to stand up to the consumer ‘sustainability’ test.
But this approach often leads to brands trying to do ‘enough’, rather than delivering genuine product innovation. If the purpose is to just convince the consumer, brands become busy trying to show they’re doing the right thing, rather than spending time trying to rethink how to actually do the right thing. These sorts of brands often fail to see sustainability as a constraint challenge that could help them make a fundamentally better product, but a badge that they need to collect.
The alternative approach is to build a brand that actually embraces the power of sustainability to act as design constraint that will help make better products. Addressing the sustainability of products in the CPG sector fore example, presents a new opportunity to re-examine the reason a product exists in the format it does and improve it, either because its cheaper or because it delivers better results in its fundamental purpose.
Too often brands trying to innovate in the sustainability space have lost sight of the fact that their job is really to innovate in the product space, full stop. And the key to innovation is addressing the basic human value proposition — offering a better price and/or a better quality product. These are the underlying principles of mass consumer need, and they aren’t changing.
There will of course always be a niche of consumers that will prefer lower quality or higher price products because they rank sustainability so highly that the price or efficacy of the product matter less. These are the sorts of customers that some brands have decided to pursue, doing enough to convince them that their products meet their standards of sustainability, rather than being a better product.
But the key to reaching the wider market unavoidably is in innovating better quality and better priced products. Truly innovative companies look beneath the challenge of making something sustainable enough for consumer standards, and instead concentrate on how to use sustainability as challenge to make the product quality or the price better.
In the late 19th Century, many businesses trying to solve the growing problems that came with mass horse travel — from manure mountains, to horse carcasses — would have focused on how to deal with the negative externalities directly. But ultimately, interpreting the real challenge as getting people from A to B effectively and efficiently and trying to innovate to solve that problem transformed the entire category of travel.
Likewise the best brands shouldn’t shouldn’t just be focused on finding more sustainable solutions to the externalities of existing products, or they risk being replaced by genuine innovation. The Ford motor car eventually made redundant those efforts to deal with the negative externalities of horse travel. Henry Ford said— “If I had asked people what they wanted, they would have said faster horses.” And that would have been fine under the narrow criteria of needing better horses for travel. But this limited scope missed the greater opportunity, which was to reimagine the horse by thinking of it as a means of private transport to get you from A to B effectively and efficiently.
Sustainability minded brands fall into this trap of narrow thinking about the problem when it comes to sustainability, and it leads them to limited solutions. It’s why a lot of noise from CPG companies about sustainability seems to be focused on changing the mix and type of plastic in product packaging. When the product is fundamentally the same in form and is used in the same way, there are very few ways you can actually improve its sustainability standards. To avoid this trap, brands need to re-imagine products from the ground up, rather than tinkering with the fringes of what can be done to address the challenges of products that exist today.
That doesn’t mean these short term solutions are not a fruitful endeavour. Targeting consumers that believe ‘sustainability matters’, can of course drive short terms sales, win a brand shelf space in competitive retail categories and pick up undecided consumers who see the sustainability as a tie-break to help choose otherwise identical (in terms of price and quality) product offerings.
But this approach does miss the long-term potential of a fundamental rethink of the CPG business model. Changing the packaging of a product to recycled PET and hoping the customer chooses you over another brand can cu-through for a time. But rethinking the supply chain, the distribution points and the way customers use a product can help improve the value equation for customers (better price or better quality), deliver long term brand growth and tackle sustainability all at once.
Tweaking the sustainability of products at the fringes without fundamentally transforming the product wont create long term value. Not because ‘you’ll be found out’ in some sentimental view that consumers desire authenticity, but because you wont be delivering true innovation. It will just be a matter of time before ‘better’ products win the day.
So why bother focusing on sustainability at all? If it’s about innovating better products, full stop, why does sustainability matter?
All great innovation comes out of constraints. Often constraints arise only slowly. It can take a long time for a sector to squeeze every last drop of productive improvement out of the existing ways of doing things before anyone starts looking at alternatives. Sustainability on the other hand, has created an abrupt, existential constraint in many industries, bringing with it an opportunity for rapid innovation that consumers have proven they care about.
In that respect, the sustainability challenge is the best thing to happen to the world of CPG because it’s been on an otherwise very slow road to innovate. Fundamentally products have been packed, transported, sold and used in the same way for a hundred years. The drive for sustainability puts a much needed constraint on this old way of doing things and has the potential to disrupt the industry for the better in a much shorter period of time than otherwise might have occurred.
It’s possible to take the need to create more sustainable products in the first approach and design products to sit on shelves in supermarkets in slightly more environmentally-friendly packaging. Or brands can use this shift in consumer belief to re-design the way products exist such that old patterns of purchasing and product usage — the very patterns that drove us to this point — are totally eradicated from our patterns of consumption.
As I think about how to re-design the products that exist in the family bathroom — from soap, to moisturiser, hand wash to barrier creams— I want to look at using sustainability concerns as a way to fundamentally change how we supply, purchase and consume these sorts of products. It’s an ambition to not just make products sustainable, but to make sustainable products better.
