Joel Makower / 24 Jan 2019
A new initiative by a small company has compelled more than two dozen of the world’s biggest brands to begin testing reusable packaging.
Loop, launched today at the World Economic Forum in Davos, Switzerland, has amassed a blue-chip roster of companies, all of which are piloting a new system of high-quality packaging that can be returned and refilled again and again. In essence, it changes the ownership model of packaging from consumer to producer.
The big question is, will consumers buy into it?
Today’s launch is the product of more than a year’s work by TerraCycle, the Trenton, New Jersey-based company that made a name for itself by turning hard-to-recycle waste (think juice boxes, coffee capsules, plastic gloves and cigarette filters) into new products. Along the way, the company, founded in 2001, has partnered with major consumer brands, retailers, manufacturers, municipalities and small businesses in more than 20 countries.
Loop is the natural progression of that model, as well as the corporate relationships TerraCycle developed over the years. Its Loop partners include Procter & Gamble, Nestlé, PepsiCo, Unilever, Mars, Clorox, Coca-Cola, Mondelēz, Danone and a dozen or so smaller brands. European retailer Carrefour, logistics company UPS and resource management company Suez are also engaged in the system.
The service will launch this spring in two markets: Ile-de-France, the region in north-central France surrounding Paris; and the New York region, which includes parts of Pennsylvania and New Jersey. Initially, about 300 products will be available in durable, reusable containers, many created especially for Loop.
“The key thesis statement is we can’t just recycle our way out of the garbage crisis,” Tom Szaky, TerraCycle’s CEO and co-founder, explained to me recently. “We need foundational changes. Our version of the foundational change is: How do we solve for disposability at the root cause, while matching the benefits?”
Loop brings back the old ‘milkman model,’ where products are delivered to your door at the same time empties are picked up, washed, refilled and readied for delivery to another customer.
Simply put, Loop brings back the old “milkman model,” where products are delivered to customers at the same time empties are picked up, washed, refilled and restocked for delivery to another customer. The customer gets the product but the company owns the package.
The reality is somewhat more complex.
Loop initially will be an e-commerce play. Consumers can order goods from the Loop website or that of a partner and have them delivered like traditional products ordered online. But there’s a twist: Customers pay a small deposit for a package that has been designed for 100 or more use-cycles. When the container is empty, customers place it in a specially designed tote for pickup or, in some cases, can bring it to a retailer. They can choose whether they want that product replenished; if not, their deposit is returned or credited to their account. The empties are sent to a facility where they are washed and refilled.
The entire process is handled by TerraCycle, from sale and delivery to package return and cleaning. In effect, TerraCycle is the online retailer, buying wholesale and selling retail. The package remains the property of the brand.
Eventually, Loop will expand to include brick-and-mortar retailers — Carrefour and Tesco in Europe have signed on and expect to introduce Loop products in their stores later this year; a U.S. retail partner hasn’t yet been named. In that in-store version, consumers can bring empties back in a QR-embedded container provided by Loop.
Scratching a niche
The rebirth of reuse has been long coming. Since the dawn of the recycling movement about 30 years ago, companies have tried a number of schemes to enable consumers to use packaging over and over. One plan featured small packets of concentrated liquids used to refill a bottle of household cleaner — just add water to the concentrate and, voilá, a full bottle of a brand-name product. Another approach, refill stores, emerged in cities in Europe and North America, enabling consumers to bring their own container to buy bulk goods. Refill stations also are in traditional supermarkets and in some personal care retailers.
But none of these has caught on beyond a tiny niche. Consumers, outside of a precious few hardcore greenies, don’t really want to be inconvenienced, much as they may be seeking to avoid wasteful practices.
Loop’s approach seeks to overcome those obstacles. The key, said Szaky, is trying to mimic the way consumers already buy, use and dispose of packaging.
We realized that recycling and using recycled content is about trying to do the best you can with waste, but it’s not solving the foundational reason we have waste.
“We realized that recycling and using recycled content is about trying to do the best you can with waste, but it’s not solving the foundational reason we have waste. We did a lot of reflection on that and realized that the foundational cause of garbage is disposability and single-use. We tried to come up with a way to solve for disposability but maintain the virtues of disposability, which are convenience and affordability.”