July 15, 2018

How companies change packaging without alienating customers

People cheered Starbucks' recent decision to ditch straws.

But that's not always the reaction when a company tries an eco-friendly package change.

PepsiCo unveiled a new biodegradable SunChip's bag in 2010 but had to retreat after customers complained that the packaging was too noisy. In 2009, Kellogg tested out shorter, squatter cereal boxes that used less cardboard packaging. But the redesign didn't take off.

"Consumers are creatures of habit," said Allen Adamson, co-founder of growth strategy firm Metaforce and adjunct professor at NYU's Stern business school. "Any change is often difficult for them."

A company must take several things into account when it comes to changing its packaging, like pressure from community groups and cultural and political trade winds.

Starbucks, McDonalds and Dunkin Donuts have promised to phase out materials like plastics and polystyrene in the wake of a global movement against pollution.

The United Kingdom, is moving to ban plastic straws to help save 1 million birds and more than 100,000 sea mammals that die every year from eating and getting tangled in plastic waste, is moving to ban plastic straws. Some US cities have started putting their own bans into place.

"There does seem to be a critical mass coming together recognizing the problems associated with single-use food packaging," said Eric Goldstein, an attorney with the Natural Resources Defense Council.

But companies have to be careful not to scare away customers, especially at the grocery aisle.

Packaged goods sellers have a tougher time than restaurants when changing materials for environmental reasons because if customers see unfamiliar packaging in a store, they may just turn to a competitor.

"Consumers have an instant to recognize you," Adamson said. "Any change at shelf can have a dramatic impact."

Modest changes may work better.

Kroger has been quietly redesigning its milk jugs to use 10% less plastic than before. By the end of last year, the grocery chain switched to the new container molds in about half of its dairy processing plants. Kroger plans to fully convert to the new container in the beginning of next year.

The changes to the bottle are subtle. Erin Sharp, the company's group vice president of manufacturing, said that the new bottle includes markings that show how much milk is left, and is a little easier to handle. But few people have observed the change.

"At the store level, there's not been a lot of publicity around the packaging reduction," Sharp said. "For the majority of our customers, they really don't notice."

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