There is an untapped opportunity worth EUR 966 Billion[1] if multinational brands switched to sustainable and eco-friendly products. This resulted from a research conducted by Unilever after interviewing 20,000 adults in five different continents. A major segment of consumers prefers products which are environmentally sustainable – especially if the packaging clearly defines the positive social impact. For this purpose, Unilever undertook an initiative called Sustainable Living Plan (SLP) in 2010.
More than just a new strategy, the Sustainable Living Plan is truly reshaping the company’s business model. Unilever’s ambition is to ultimately dissociate the business growth from the environmental impact by decreasing the environmental footprint across the value chains.
The three pillars of the plain are as follow:
Unilever’s aim is to: “help a billion people to take steps to improve their health and well-being” by 2020 and reduce the environmental footprint by 50% by 2030. The plan covers all the brands and products of Unilever, without any restriction to niche segments.
Through some of its brands, Unilever seeks to change people’s behaviors and increase their hygiene awareness. For instance, in emerging countries Unilever markets its antibacterial soap Lifebuoy to school and health clinics with the objective to increase the frequency of handwashing. The second pillar of the “Health and well-being” goal is to improve nutrition of the poor and needy by achieving the highest nutritional standards.
The next pillar is to reduce the environmental impact principally by decreasing the use of water, energy, and land as well as the production of waste and greenhouse gas emissions. Doing so requires the coverage of the total value chain from sourcing, manufacturing to consumer use. Unilever integrated SLP three pillars in its sourcing policy and consequently more than 51% of raw materials currently used by Unilever are sustainably sourced. Additionally, waste generated by manufacturing has been reduced by 98% since 2008 and the use of water has been decreased by 39%.
Nonetheless, to achieve its environmental objective Unilever still needs to shift consumer behavior that represent 64% of the gas footprint. The company did not yet find the right strategy to answer this challenge and most of the consumer environmental impact remains unchanged.
A prime example of transformation is the compressed deodorants segment. Under the SLP strategy, a compressed deodorant reduces 50% of the gas included in a can; therefore, the packaging size can be amended without affecting the content and effectiveness of the deodorant.
This new technology has been applied to all the deodorant brands of Unilever – Axe, Dove and Rexona, and launched in the UK, France and Germany in 2013.
The upsides of this product are three-pronged. It has a positive impact on the cost, the environment and consumer convenience. Through the reduced size, packaging and transportation cost are reduced; from an environmental perspective, the new cans use on average 25% less aluminium, further, 53% more cans fit within the standard transportation carriers – thereby reducing the number of trucks required for distribution. Through this innovation, the new aerosol deodorants can reduce transportation costs and the carbon footprint by 25%[2].
For the consumer, the same content is provided with a convenient “on the go” format; this aerosol packaging can easily be carried in hand luggage as it contains less than 100 ml – thereby increasing convenience during travel.
One of the challenges Unilever faces is how to convince the consumers that despite a smaller size, the deodorant is as performant and effective as the bigger one. For this purpose, television and in-store campaigns were initiated, showcasing how both format takes the same time to empty in usage. Unilever also introduced small trays on shelf to lift the new cans to the same size of the old one to enhance the impression that the two bottles have the same content.
According to Unilever, 50% of the consumers have converted to this new format. Unilever is holding no patent on this technology and is encouraging competitors to switch to compressed. Doing so could save 21.000 tonnes of aluminium which is enough aluminium to make 10 million bikes[3] – an environmentally friendly mode of transportation.
[1] https://www.marketingweek.com/2017/01/03/third-consumers-buy-brands-based-sustainability/
[2] https://www.theguardian.com/sustainable-business/sustainability-case-studies-unilver-compressed-aerosols
[3] https://www.unilever.com/news/news-and-features/Feature-article/2015/Unilever-invites-competitors-to-share-emissions-saving-compressed-deos-technology.html
Very interesting concept and a nice step towards business sustainability. However, convincing consumers that less is more (smaller packaging has equal content) runs counter-intuitive to the consumer psychology. Most people don’t pay much attention to the labelling and may by default buy a deodorant with the same quantity bit bigger packaging.
The fact that Unilever has went ahead to take this challenge is commendable