Reimagining Packaging By Changing Consumers Behaviour

The purpose of product packaging is to transmit information about the product while also securely delivering it to the customer. A well-packaged product helps consumers believe that the content inside it can be trusted. Over time, a well-designed package has become a means to differentiate from the competition. The race has led to six-brand constituting 50% of all household plastic waste, according to a recent Hindu article. (Six brands account for 50% of plastic waste in Thiruvananthapuram, 20). Although packaging material is just a fraction of the product costs, one only has to consider the volume of products sold, ex. An average Indian consumes more than 11kgs plastic every year.

Further, climate change events and shifts in regulation have resulted in consumers and companies identifying newer packaging techniques such as multi-use packs and naked products to reduce packaging waste. For instance, Amazon and Flipkart, who predominantly use plastic bubble wraps and poly-pouches for their packaging, announced sustainable packaging measures achieving 25% and 15% reduction in plastic and cardboard-boxes used in packing respectively. Some of this was achieved by using a paper bag for cushioning and replacing invoices in poly-packets. 

Let us consider the case of toothpaste packaging. It is suggested that 900 million boxes of toothpaste are consumed each year globally. In India alone, every year 20,460 tonnes of paper and plastic waste are generated through toothpaste consumption. According to a Bhubaneshwar-based NGO, the packaging of toothpaste contributes to 13% of the total domestic solid waste. These boxes tend to make transport of the product convenient. However, Iceland eliminated cardboard boxes and was still able to sell toothpaste without any damage to the products. The consumers initiated the push for the elimination of toothpaste boxes in the interest of the environment and this gradually materialized to 100% no-box toothpaste. Not just brands in Iceland.: Unilever in India is also considering reducing packaging and selling naked products. But how will consumers in India perceive such a shift? This inspired us to undertake a study to check the impact of packaging on consumer decision making and examine ways by which naked packaging could be implemented.

We began by conducting focus group discussions to understand how consumers would react to naked product packaging. We found that many consumers claimed to be environmentally conscious and responded positively to buying toothpaste, which was not necessarily in a cardboard box as long as the tube was intact.   Almost half the participants claimed that they were willing to forgo a branded product in the interest of buying an ecofriendly product. We decided to put these assertions to test with a field study. The same experiment was run on our campus department store and in a Kirana store outside the campus. In the first phase, which lasted for one week, we removed toothpaste from the packaging box and put the tubes on a shelf with messages informing potential buyers that toothpaste is unboxed, keeping the environment in mind. We added quotes like “Buy Toothpaste – Not the Box,” “Only buy what you want,” and “Be Smart – Be Ecofriendly” to entice the customers to this shelf. The shop-owners recorded sales and consumer interactions. We found that many consumers showed interest in these unboxed tubes of toothpaste, however, barely any purchases happened (only 20% sold).

Interestingly, interviews with the customers revealed that the consumers did not trust the quality of the unboxed product. Based on this finding, we conducted another study. This time we provided a small price discount on the unboxed toothpaste. As one can imagine, we saw a jump in sales in both the stores when discounts were offered. In week 1, we registered 40% sales and sold out by the end of the second week. The rise in sales after the discount strongly suggests that price benefit is a strong motivator that seems to overcome the barriers of purchase like uncertainty about purchase quality. Further, consumers may believe that firms are transferring their savings from packaging to consumers.

These results, taken cautiously, suggest that incentives might move consumers to adopt sustainable behaviour. Maybe such incentives can be withdrawn once sustainable practices are established. Further, firms planning to eliminate packaging should have communication campaigns that address the issue of trust and product quality to inspire consumer confidence. Nestlé, Japan, took up the initiative to replace plastic packaging on KitKat with Origami paper. This act estimated to cut 30 tons of plastics per year is also an example of how marketers could creatively pursue sustainability goals. While the focus of our study was on consumer behaviour and response, any firm willing to the necessary changes will have to focus on their supply chain management as well. 

Product changes with the goal of sustainability will help in a dramatic reduction in material costs as well as recycling costs. With increasing understanding among consumers about the negative impact of packaging and new government mandates, it is time for marketers and firms to get innovative about their product placement in the market.

With inputs from Single V. Vinayak and Balige D.K. Rao are second-year MBA students at the Indian Institute of Management Ahmedabad.