I’ve written about packaging in terms of how it supports brand image, how it protects product and how, in general, it helps move product off the shelf. Now, I come across a bit of an anomaly—natural packaging. I don’t have to dig far to find packaging that provides better protection benefits, and research has demonstrated that environmentally friendly packaging is not a driving factor in moving products off a shelf. Is natural packaging better at supporting and enhancing brand image? I doubt it.
What natural packaging does do better than any other type of packaging is support a brand ideal. The message of what a natural product is and what the companies that market these products stand for, in a sense, can be conveyed through the packaging.
According to Laura Setzfand, director of marketing, personal care division, The Hain Celestial Group, natural packaging is defined in terms of its source, how it has been created and its recyclability. In its guidelines for certified natural cosmetics, the Federation of German Industries and Trading Firms for pharmaceuticals, health care goods, dietary supplements and personal hygiene products (BDIH) states that packaging must be manufactured from renewable and biodegradable materials. In addition, minimal use of packaging is expected, “keeping in mind the expectations of consumers.”
In fact, natural products are, to a great extent, beholden to natural packaging. Naturals allow companies to emphasize their philosophy and embrace socially and environmentally responsible business practices, which includes sourcing packaging and consideration for its entire life cycle. The Hain Celestial Group’s Zia Natural Skincare brand, for example, believes the packaging it utilizes reflects and communicates the brand’s dedication to naturals and renewable resources.
“Zia’s packaging choices for the Brilliance line communicate Zia’s commitment to preserve the planet and reduce our impact on the environment,” said Setzfand. “Many consumers share this philosophy, but may not know how they can make an impact on a daily basis. We hope to build awareness among consumers that the choices they make can help not only preserve the environment, but also reduce usage of non-renewable energy sources.”
In a recent New York Times article, L’Occitane chief executive, Reinold Geiger, states that nobody cared about natural ingredients when the company was founded in 1976. Today, according to Euromonitor, the global market for natural cosmetics stands at $3.9 billion, and is forecast to grow 9% annually through 2008 to $5.8 billion—compared with a growth rate of 1% for conventional cosmetics and personal care. Freedonia Group Inc.’s “Cosmetic & Toiletry Chemicals” study forecasts the U.S. market to move away from traditional cosmetic and toiletry chemicals and toward more natural products.
L’Occitane exemplifies this growth, expanding from a retail chain of 10 stores to 750 in approximately 10 years; posting $350 million in revenue in its last financial year. The company opens an average of two stores per week in the U.S. and Asia.
According to the Freedonia Group, Inc., natural products have become a key element of marketing strategies in cosmetics and toiletries, and consumer awareness and concern about the source and properties of the ingredients in their personal care products is increasing. Natural formulations often are defined by what they do not include, and, according to Freedonia, consumers are reassured by labels that feature natural rather than synthetic-sounding ingredients.
Though the packaging itself does not move natural products off the shelf, naturals are gaining momentum, and the packaging has to support that growing interest.
“Our consumers are often defined under the LOHAS umbrella,” said Setzfand. “These are consumers who live or strive to live a lifestyle characterized by health and sustainable practices. This group actively seeks out brands that reflect a commitment to health and sustainability. As consumers become more aware of natural products and organic produce, they also become more aware of natural packaging and the need to minimize wasteful packaging and recycle. These consumers increasingly expect and demand packaging that is made from recycled content or includes at least 35% post-consumer waste.”
According to Setzfand, the impact of not using natural packaging would be detrimental to Zia. Consumer perception would be negative, and distribution opportunities would be more limited.
In addition to the growing naturals market spurred by consumer demands, retailers are making a push of their own toward sustainable packaging. Wal-Mart, for example, has launched its own global environmental sustainability program, impacting the way products seeking to gain shelf space will be packaged. Wal-Mart buys products from more than 60,000 suppliers in 70 countries, and sells from 35,000 to 100,000 product lines in each of its 6,000-plus stores and clubs to more than 138 million weekly customers. The retailer has previously demanded that its top 100 suppliers must use RFID technology, so demands made regarding sustainable packaging are not difficult to imagine.
This push coincides with marketers of naturals expanding both domestic and international distribution channels with increased penetration into traditional retail outlets.
Constructing natural packaging means fewer materials to work with and close scrutiny of product compatibility, requiring strong supplier partnerships and shifts in traditional packaging supplier paradigms.
“We work very closely with our suppliers to source these materials since these projects often require additional investments in time and resources to find and evaluate natural packaging options,” said Setzfand. “Suppliers are increasingly willing to investigate and source natural packaging solutions. The challenge is most often the premium price and availability of material in a timely manner. Lead times can extend out three to four months.”
In some cases, naturally sourced materials are not available, and, instead, materials that can be recycled or that have been recycled and contain the maximum post consumer waste must be utilized. Other times, according to Setzfand, suppliers are not aware of material choices.
“With the growth of natural products and the increasing concern about the impact we are having on the planet, suppliers are recognizing their ability to make a difference, while enhancing their product portfolio profitably,” said Setzfand. “(They) are excited about the opportunity to bring something unique to the marketplace.”
Environmentally friendly polylactic acid (PLA), derived from corn, is one such type of product. The biodegradable natural polymer is being positioned as a replacement to PET, and Cargill Dow has invested $800 million into developing PLA and bringing it to market for food and drink containers—a market that often forecasts trends in personal care markets.
In 2006, AGI/Klearfold and NatureWorks LLC partnered to introduce NatureSource Visual Packaging plastic folding cartons, and the companies claim that, in addition to its environmental benefits, the packaging’s clarity and durability aids brand performance. According to FoodProductionDaily-USA.com, Wal-Mart plans to replace existing packaging with NatureWorks’ PLA products in a series of phases through the supply chain.
Gilbreth Packaging developed PLA shrink labels. In addition to being an alternative to petroleum-based feedstock, the packaging allows marketers to meet the BDIH dictate of minimal use of packaging. Products from both suppliers also are becoming very price competitive as the expense of PET rises with continued oil price increases.
The caveat, points out Setzfand, is that PLA breaks down at temperatures above 105ºF, which is too low for use in products that are not transported and stored in temperature controlled environments. Setzfand says that Zia utilizes recycled PET when it is not able to use PLA—in its Natural Microdermabrasion Kit for example.
Beyond choices of environmentally sound materials, natural products and ingredients themselves create unique challenges for packaging.
“Primary packaging poses more challenges than secondary packaging since it is in contact with the formulation,” said Setzfand. “Packaging stability can be difficult to achieve with recycled content as ingredients may react negatively with the package. Essential oils and natural extracts commonly affect package stability, even in non-natural materials.”
Secondary packaging that utilizes recycled content requires special consideration as well. Because recycled paper is more absorbent, printing can be a challenge to avoid compromising artwork.
Setzfand notes that the availability of packaging materials derived from recycled content and renewable sources will increase as more consumers demand these materials. This also should serve to keep costs in check, and allow packaging to flourish with the naturals market.