CPG companies ditch single-use packaging—a move that could strengthen repeat purchasing habits, as long as the brands can compete against Amazon.

WHAT HAPPENED: Major CPG conglomerates including Procter & Gamble, PepsiCo, Unilever and Nestlé are investing in refillable or reusable containers for their products to diminish waste.

Why it matters

  • PepsiCo will sell Tropicana orange juice in glass bottles and Nestlé’s Haagen-Dazs will arrive in steel pints—a response to calls for greater environmental sustainability, but manufacturing choices that come at a high price in the short term. Many of these companies are using a third party called TerraCycle, which will manage shipments, returns and cleaning to make reusable programs more convenient, not only to shoppers, but to the retailers themselves. While shoppers will have to pay slightly higher shipping charges and a $1-$10 deposit per container, they’ll be able to schedule pickup for empty containers or a buy a subscription that facilitates routine replenishment.
  • Now the main question for CPG conglomerates is to scale and growth the operation—something that may depend on how companies pitch reusable containers to consumers. Playing the eco-conscious card may narrow the scope of shoppers attracted to the program, so it may be better to focus on convenience. Amazon can also provide retailers with important about how to efficiently sell cumbersome products, which include many of the essentials offered in reusable containers. Amazon has refused to fulfill many heavier products from its vendors like bottled water; In December 2018, the online retailer changed its Amazon Dash Smartwater offering from a $6.99 six pack to a $37.20 24 pack, which parent company Coca Cola now ships directly, to cut costs for Amazon. More moves like this are likely imminent, so developing cost-effective, environmentally friendly packaging and shipping methods now will serve CPG companies well in the long run.