Packaged media's ecological awakening

The packaged media industry is awakening to ecological concerns. TRACY SHELDON, Marketing Director, AGI Media Europe, clarifies some of the macro issues at play, distils how they relate to the industry and looks at how packaging plays a role in this complex puzzle.

For those in the packaged media and entertainment industries, conversations on sustainability and eco-friendly products and practices may seem fleetingly relevant as our industry transitions to digital delivery. But the fact remains that our industry, like all others, relies on innovative packaging, merchandising tools and materials derived from fossil fuels and natural resources.

Sustainable development awareness has lead to the growth of numerous certifications, labels, processes, carbon footprint assessments or methods of measurement to certify any eco-friendly behavior or product. We may actually count no less than hundreds of them.

For example, Consumer Reports tried to calculate the carbon consumed for a flight from New York to Los Angeles. One can use at least ten different calculators (Terra Pass, National Wildlife Federation, Sustainable Travel International, The Climate Trust, among others) and face completely different results going from 1,924 lb (for the most optimistic) to 6,732 lb of CO2 used in the worst scenario.

These mixed results are caused by a diversity of ‘rules’ and ‘standards’ (if we may call them so) that are as confusing for companies as well as customers. Which ones should be trusted? Which is more accountable? Which one guarantees the best protection of the environment?

This is but one example in the transportation sector but it is demonstrative of the complexity of the issue in measuring environmental impact. However, such measurements remain highly relevant for major companies, including those in the media industry and are tools that can help create solutions.

Importance of sustainable packaging solutions

The drive for responsible environmental behaviors is compelled by three main sets of stakeholders: consumers; partners and suppliers; and shareholders and employees. There is a growing ethical compact among all of these parties that practicing social and environmental stewardship is the right thing to do for ourselves, our businesses, our children and future generations.

Consumers

The first reason for addressing sustainable development is that consumer awareness on these subjects is growing quickly. The 2007 GfK Roper Green Gauge Report revealed that 30% of consumers consider themselves environmental leaders (nearly triple the rate of 2005), and want products that are beneficial to their health and the health of the environment.

And these consumers don’t base their choices on corporate information, such as companies’ websites or newsletters. Instead, they evaluate a product’s sustainability at the point of sale – by its package. In fact, nearly three-quarters of consumers say they check the packaging labels as a source for environmental information about a product. This behavior, coupled with retailers’ requests, pressures companies for more eco-friendly practices and guarantees which packaging includes:

More use of renewable energy & materials
Better and more efficiently designed packaging with equal or enhanced protection of the product
Packaging that is reusable or recoverable

Various considerations must be taken into account and integrated in the design process including the right expertise, market awareness and innovative design capabilities. Environmentally friendly packaging is one piece of that puzzle with considerations such as:
Scorecards
CO2 footprints
Certifications (forestry and fiber is particularly relevant for packaging companies like MWV, but also any kind of material, process, ability to be reused/recycled…)
Recycled or recyclable

Some brands have even developed their own private systems, labels or certifications.

Partners and suppliers

The second reason for addressing sustainable development is that suppliers and retailers are taking steps as well, not just the brands themselves. In fact they are the second main influence on manufacturers as they seek to transform their sustainable practices.

Wal-Mart’s is getting most of the attention these days thanks to its Sustainable Packaging Scorecard which is a part of its broader Sustainability 360 programme. The Scorecard was designed to introduce common language into the discussion about sustainability and encourage brand owners to consider sustainable packaging alternatives that might otherwise have received scant attention. This heightened level of attention drives manufacturers and suppliers toward compliance and further educates them on the features of sustainable packaging, or they risk having their products omitted from the shelves of the largest retailer in the world.

Retailers, as the first line of contact with consumers, are becoming more demanding of eco-friendly products for two reasons. They themselves are trying to do the right thing and customers’ demands and expectations must be fulfilled to not lose sales.

Shareholders and employees

The third, and perhaps most potent reason that has driven such a behavioral change towards more eco-friendly postures, is global heightening of awareness. People and entities (companies, government bodies and associations) are more and more convinced that this is the right thing to do.

Access to information on social and environmental issues is making everyone more educated, and as consumers are more informed they are making different purchasing choices and ultimately putting pressure on brands to be more sustainability focused. Everyone, from corporations to individuals, now feel responsible for what has been done to the planet and accountable for what will be left to future generations.

The Wal-Mart Sustainable Packaging Scorecard

Wal-Mart's Sustainable Packaging Scorecard (see below) has brought more visibility and awareness to sustainable packaging, including issues like light-weighting packaging, cube utilization and the emissions-related effects of long-distance sourcing.

In fact, there are nine separate metrics each one being balanced to provide a final score and a ranking against other packaging in the same segment. Scoring well is essential for brands as rankings will be used by Wal-Mart buyers to help them make purchasing decisions – given that all else such as performance and price are equal.

While this tool is currently US-centric, Wal-Mart is moving into Canada and the United Kingdom with customizations for specific countries. And when Wal-Mart takes these kinds of initiatives, it is certain that their global competitors will not be far behind, like Tesco and Marks & Spencer in the UK which both have very strong initiatives.

To help brands (their suppliers) on scoring the best, Wal-Mart has created a modeling tool for packaging suppliers and others who want to understand what has to be done to perform well.

The Wal-Mart tool is still a work in process and it can be confusing; nevertheless it makes big companies stick to environmental principles. Such an initiative is a great first step in raising awareness to the environmental issue. As a founding member of the Wal-Mart Sustainable Value Network, MWV has the opportunity to share with our customers the key drivers behind Wal-Mart's efforts and discuss with them directly the steps we are taking to implement their vision.

At AGI Media we also believe that in addition to helping our clients with these considerations that we ensure packaging not only meets scorecard requirements, but goes beyond compliance. Our focus is on helping our customers develop packaging with a sound environmental appeal from the very beginning of the products' life cycle. We look at the product from its very creation and design a package from the ground up that is appropriate to the needs of the product and authentic in its approach to sustainability.

Company philosophy & approach to sustainability

Having explored some of the impact of sustainability on how consumer goods are created, marketed and sold, we thought it would be helpful to put some of this thinking into a practical reality and explore how one company, our company, as a global packaging leader for many of the world’s most-admired brands, thinks about and practices sustainability.

MWV offers sustainable packaging solutions to help its customers address all three key audiences previously discussed through the realities of business and market. Sustainable packaging is thought as a “packaging that provides solutions to address and optimize each phase of a packaging system’s lifecycle” from its design to its reuse, through the choice and supplying of materials. A holistic approach is the only way that these key audiences will believe a company is credible when making sustainability claims.

A member since 1996 of the World Business Council for Sustainable Development (WBCSD), MWV is also a founding member of the Sustainable Packaging Coalition (SPC) in 2003, the Sustainable Forestry Initiative (SFI) in 1994, and the Chicago Climate Exchange (CCX) in 2003. These practices have been externally recognized by premier credible third parties – such as the Dow Jones Sustainability World Index. For the fourth consecutive year MWV has been named to this prestigious list of the top 10% of the world’s largest 2,500 companies. Additionally the company was named best in class for the Containers & Packaging Industry Group upon entering that segment and has continued in this position for the third year in a row.

The primary substrate for MWV’s packaging solutions is fiber – a renewable resource that comes from trees and is recyclable. The company protects this valuable resource by using responsible practices to manage its own forestland, and by sourcing fiber from responsible third parties. MWV supports the Sustainable Forestry Initiative (SFI) and in 2008 received chain of custody certification from the SFI and Program for the Endorsement of Forest Certification (PEFC), which provides third-party validation of MWV’s sustainable fiber sourcing practices, and helps assure our customers and consumers of the company's responsible environmental stewardship.

Sustainability in the media sector

When considering sustainability in the media sector, the following sheds interesting consumer insights. Consumers expressed that they were equally likely to purchase a CD packaged in a plastic case as one packaged in a coated paperboard box when both were listed at the same price.

However, when the “100% Recycled” was added to the paperboard package, consumer preference changed dramatically: 71% of consumers preferred the box with the claim compared with 29% who preferred the plastic, non-labeled case when both were listed at the same price (2007 GfK Roper Green Gauge Report).

AGI Media leverages the extensive capabilities of the MWV packaging platform to provide its clients the best possible packaging solution that meets their brand objectives. In a highly competitive market, adopting and complying with eco-friendly processes and tools is economically vital as explained above. It is also challenging in an industry that relies on plastic based cases and is exploring the use of packaging made of renewable resources and that is recyclable or biodegradable.

AGI Media is constantly investing in product development and new techniques and has been incorporating sustainability through its packaging lifecycles with five main steps:

1. We focus first on sourcing and use of raw materials with the development and use of new, bio-based, and recycled content packaging materials (recycled paperboard substrates, PLA, and recycled PET).

2. Design and Manufacturing are then addressed. Leveraging our Center for Packaging Innovation in the US, that drives market knowledge and consumer insights, as well as innovative design and materials science, we provide package design consulting that takes into consideration sustainable benefits.

3. Transportation and delivery are also taken into account. Light weight and/or reduced size packaging impact the number of pallets, truck traffic and fuel efficiencies consequently mitigating carbon impact.

4. Sustainability not only means using materials that are recyclable or made from recycled materials, but also can focus on a package’s ability to enhance the sustainable aspects of the product. A great example of this is aseptic packaging, which is made of a mix of paperboard, plastic and foil. While the package itself may not be easily recyclable, this substrate keeps liquid products fresher, longer, extending product shelf life. It also eliminates the need for refrigeration, which not only has positive environmental sustainability impacts along the delivery system, but has social benefits by providing nutritious milk products to parts of the world that may not have refrigeration.

5. Finally, we are working on coating and ink alternatives that provide the same look and feel without poly and foil laminates and are recoverable.

What can finally be said on trends in sustainable packaging is that while there is an increased focus on measurement tools, like the Wal-Mart Scorecard, carbon footprints and other labels and certifications, none of them capture the entire “story”. This much is certain, companies also have the chance to affect consumer preference by educating consumers about environmental issues and the benefits sustainable packaging can have on our world.

Sustainability is part of our ‘DNA,’ and we continually improve and enhance processes and products with sustainability goals in mind. Each day, we integrate sustainability into our packaging solutions in the way we source raw materials, and design, manufacture and transport our products. Sustainability also influences our business practices – from the research behind our innovative and market-relevant products, to the ethical business conduct of our employees, to our many initiatives to help communities grow and prosper.

WAL-MART'S 7 'R' OF SUSTAINABLE PACKAGING

REMOVE Eliminate unnecessary packaging, boxes or layers, and harmful materials.

REDUCE “Right-size” packages, optimize material strength, and design packages appropriately for contents and merchandising requirements.

REUSE Wal-Mart has a goal that all transport packaging will be reused or recycled by 2011 through improved pallets and reusable plastic containers (RPCs).

RENEW(ABLE) Use materials made of renewable resources as measured using ASTM D6866, or select biodegradable materials that meet ASTM D6400 or ASTM D6868.

RECYCLE(ABLE) Use materials made of the highest recycled content without compromising quality, including post-consumer recycled material (PCR) where appropriate. Components should be chosen based on recycle-ability post-use, with a goal of increasing the municipal recycling rate to 35 percent by 2011.

REVENUE Achieve all principles at cost parity or cost savings, which requires a supply chain approach.

READ Get educated on sustainability and how suppliers play a part....

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