📦 The Future of Packaging: Sustainability, Hygiene, and E-commerce | Jeffrey Osterroth Interview
What's the real story behind our product packaging? Jeffrey Osterroth, with a unique vantage point from the heart of the packaging industry, discusses the major shifts and the future. How are leading industry players adapting to the demands of both sustainability and safety? Tune in for a conversation that will reshape how you shop!
ML (Michael Londesborough): Roughly 40 percent of plastics produced are used in packaging – a significant portion of which are single use. How this packaging is designed, managed, and recycled is a key aspect to a circular economy.
ML: With me today is Jeffrey Osterroth. Who is an American citizen living in the Czech Republic for 27 years and he is the general manager of the Atos group, a B2B company that specializes in communication within the retail and packaging industries through the production of a specialist magazines and also the organization of conferences. Jeffrey's work provides him with a unique perspective on why and how we package our goods. So what is the reason we package our goods? Are we packaging correctly? And what is the future of packaging? Let's talk about it. Jeffrey welcome!
JO (Jeffrey Osterroth): Thank you.
ML: I'm going to start with a simple question. What is packaging?
JO: What is packaging? Well, packaging obviously has evolved a lot, but if you have to look back to the original role of packaging, it was growing stuff in the fields needing to bring it home to put it into a box. That was the original package. Then it evolved slowly into conservation - putting things in jars so that the fruit will last through the winter. Eventually, over time, when people started selling what was in the packaging, then they needed to add things to it, e.g. names. Then eventually marketing took over, and the packaging became a marketing tool and it stayed that way for a long time as the amount of packages grew, the amount of products that were sold grew and then suddenly we found out we have so much packaging around that we can't handle. Then packaging became in a way vilified, thus packaging became something that people were looking to reduce, replace or remove all altogether. The interesting thing is the situation on the market now – in the pandemic crisis, because all of a sudden you see that packaging is going back to its original role, which is protecting the goods and protecting the people, who are buying the packaged goods.
ML: I see, so we have an evolution of the reasons why we need packaging.
ML: …and also the priority goals of that packaging and what it's meant to represent - from being a container to maybe preserving the goods within that containment, to a marketing tool. Then there is an effort to reduce that packaging after so much of it exists in our environment and economy and to a current set status with the Covid-19 virus and perhaps a renewed interest in extra packaging.
JO: Exactly. You see that packaging was vilified, nobody was trying to reduce it and all of a sudden packaging is back. Retailers were saying how they were selling their bread open, we don't need to package it…and then the crisis came. The pandemic came and all of a sudden all the bread was back into bags, into plastic, because the people wanted it that way and because, suddenly, hygiene was more important than sustainability of the packaging.
ML: Right. So, that's a fantastic way to think about packaging as this sort of evolving, almost species out there. In evolution there are always driving forces, there’s forces which determine our evolution - the environmental forces, the genetic forces etc.. You're specifically working in the communication between these interest groups within this packaging industry. Tell me a bit about those interest groups. And what are the forces that are determining the evolution?
JO: That’s very important to say at the beginning, because I publish a packaging magazine, I organize packaging conferences and events, but I'm not a packaging expert. I don't claim it to be. Well, what I do know is I know the players on the market - whether talking about the retailers, who are selling the packaging, the producers of the packaged goods or the producers of packaging materials and solutions. The government, who is obviously regulating it and the recycling companies and sorting companies, which need to handle it. What we do is that we bring these groups together, provide them with a platform - either printed in the magazine, online or in person at conferences - and arrange it so that they can discuss and come up with common agendas and common strategies.
ML: Tell me a bit about that. How is that changing? What has been the common agenda and what is emerging to be on the new common agenda?
JO: Well, you really see that the number one agenda for the last few years has been sustainability. And I know that's the main reason we're here, that's what you like to talk about in “Let’s talk about it”. Sustainability is extremely important for packaging. You saw companies investing in sustainable solutions, moving forward with sustainability and finding ways to reduce packaging or to make it more environmentally friendly. Then, obviously, the pandemic crisis came and everything changed. We can really look at three different ways that it changes - the first, which I mentioned already, is the hygiene, packaging's old role coming back into focus. Protecting the products and protecting the people who are buying the products, that's the number one. The second that you see is e-commerce. I assume you’ve been using e-commerce for a long time…
ML: Yes, well, one thing that seems to be quite odd about e-commerce is that I am buying a packaged good and that packaged good is repackage for the transportation to the house. Thus, I find that I'm under a mountain of cardboard and bubble wrap. We get layers of packaging building onto one another.
JO: Yes, completely true. It plays a couple of roles. Obviously, there's the hygienic role as well, because you need to have the packaging hygienic when it's coming. That was on the top of everybody's mind when the pandemic was happening. It's like calling the person from the e-shop and saying: “Leave it at my door, I'll pick it up in a few days, because I don't know who touched it before”. That was obviously a major role. However, when you think about the packaging and when you buy something in a store or you buy something through an e-shop, the packaging is doubled or tripled, because it needs a transport packaging as well. So, there is a shift in people buying online… you and I have been buying online for a while, but there are a lot of people who discovered it now with the pandemic and all of a sudden they're buying everything online. There is a tremendous increase in packaging because of e-commerce.
ML: Perhaps you're anticipating an increase in the amount of packaging we're using?
JO: Of course.
ML: …Which goes against the trend that you mentioned previously about the drive for greater sustainability and against, perhaps, slightly more humble approach to the amount of packaging we're using. Let’s take a step back to that sustainability drive. Do you have any packaging examples with you, where they've made a really an attempt to be more sustainable?
JO: Yes. The examples I have they illustrate one very important point and it’s that there are different agendas. On the one hand, we want to reduce the packaging, but on the other hand we want to reduce, e.g. CO2 emissions and the carbon footprint. So you see a lot of these different agendas. I'll show a couple of different things. The first one is my favorite - the cucumber. Now, as you noticed, this cucumber is packaged in plastic. I could get stoned by some environmentalists, who say why do you buy a cucumber that is packaged in plastics. It’s completely unnecessary, it's got its own package – that’s the green on it.
JO: A lot of people went against packaged cucumbers or wrapped cucumbers because it was unnecessary plastic. However, when you think about it, it's not a necessary plastic if that having a cucumber wrapped in plastic keeps the cucumber fresh longer.
ML: I see. So it's not just the case of the hygienic thing, where I can imagine lots of people checking, but having all these fingerprints everywhere on is easily removed by removable packaging. You're saying that it actually has an effect on the contents inside…
JO: Yes. The cucumber lasts three times longer, if it's packaged. Then you get into the competing agendas - the amount of plastics versus food waste. Is it good to sell cucumbers without plastic in order to save the plastic, but then to throw away more cucumbers, because they're dried out and nobody wants to buy them? I personally don't want to buy dry cucumbers, so I always buy them in plastic. If people are trying to sell it to me without of plastic, I don't want it.
ML: So, there are the pros and cons. It's the plastics sort of inherent properties of keeping that barrier against, whether it is bacteria or indeed a lot of water. I think it is the main driver that is making the cucumber more preserved. Okay, that's the material value of the plastic versus what we do with the plastic after it's discarded. That's an interesting example.
JO: That's one…If any retailers are watching, don't try to sell me a cucumber without plastic on it. I don't want it.
ML: Well, that’s your opinion. Do you have any idea about what is the general trend? Do people concur with that opinion?
JO: It's really split. Obviously, there are the people who don't care one way or the other. That's the majority. But then you get people who are really against it and if you follow some of the online retailers and their chat groups, they get a lot of hate for selling cucumbers in plastic. The retailers in a lot of ways aren't able to, aren't willing or are afraid to explain the reasons.
ML: Well maybe, for example in the stores, where we buy these items, there could be some sort of explanatory text or a diagram saying: “The reason why we are selling this product in this packaging is, because - yes we understand that we have to be sensible in recycling of the packaging and for this you can go here and there - but it does ensure that we have significantly less food waste, it's retaining water in the fruit itself and therefore preserving it for consumption over a longer period of time, which reduces all sorts of carbon footprints and problems associated with food waste.
JO: Exactly. That's the one agenda battle you could say. It is packaging versus food waste and also hygiene versus excess packaging. That’s one. Then the second that you'll see as competing agendas is this: we all want to save the environment, we all want to help, but what's the way to do that? Is it reducing CO2, reducing the carbon footprint or is it reducing the amount of plastics, improving recycling so the plastics aren't laying on the beaches, in the oceans and getting into the stomachs of the fish? It's a very difficult point. I brought another example. This is a Swedish company that does Mexican product. They came out with new packaging for their tortillas. Right in the front, zoom in on that: “New and improved packaging 35% lower CO2 impact. Read more on the back.“ And when you flip it over and you read in the back, the first thing you should see if you're a recycler or a sorter is number 81.
ML: What is the number 81?
JO: Well, the first thing is that there are at least 81 codes. Anyone who wants to recycle well needs to basically know all these codes. Obviously they're the top ones, but 81 is composite. What does composite mean? Well, they wanted to reduce the plastic, so what they did was that they took the…
ML: So it was previously a plastic?
JO: It was all plastic before, mono type material.
ML: That's obviously a plastic on the back.
JO: Right now it's a 100% plastic back, but the front is 50% plastic and 50% paper.
ML: But you can't recycle that…
JO: Well, technically you can. I'm sure there's some way, there's somebody on earth who will recycle it in some way. And again, we're talking about material recycling, not burning it, because burning it is also recycling it.
ML: In terms of energy…
JO: Exactly. So, I actually googled this before I came here, finding out what do I do with this as a consumer. I love recycling or sorting and I love that the material that is sorted is then recycled. Very important point - sorting does not equal recycling.
ML: No, we've discussed it several times.
JO: I'm sure you've had.... So, I wanted to do it. - IGoogled it and basically the number one answer on Google was to call the company and ask the company. Who's going to do that? Nobody's going to do that. They're just going to throw it out. What you really should do is just separate it, put this in plastic and put this in I don't know…
ML: …in paper, plastic composite material, but there is none.
JO: Exactly. Again, you get the competing agenda. How do we help the environment? Are we going to improve the carbon footprint, lower the CO2 or are we going to going to encourage recycling by having packaging, which is all of one material and very easily recycled and identifiable? Because that's another major problem.
ML: For me, it's about education and communication, because you can argue that this big 35% lower CO2 impact will sell that product.
JO: It will…
ML: It will give a competitive advantage over others.
ML: And it's got nothing to do with the content, just the packaging. So people are going to make consumer choices based on that packaging. It could be really based on, I don't want to say a lie, but certainly on something which makes it very difficult in the sense, whether I put it in plastic or you in paper, you are wrong in either case. That would suggest that should be incinerated.
JO: Right. It's certainly not a lie. Everybody has their own truth.
JO: Sometimes the truths are different, as we know in today's day and age. But it comes down to: what is the agenda, what are they pushing?
ML: When you say agenda, for me it's about the priority. Right?
ML: As you said, what is a priority? Is the priority to reduce carbon dioxide? That’s been admitted. Then we've had lots of discussions about the hidden carbon footprints of all sorts of different types of packaging or recycling techniques, etc. So it's very difficult to understand completely what is the best the best route out.
JO: It is very difficult. It's the competing agendas and the need for communication, which is what my business is – about the communication. The agendas can be synchronized and we can agree to priorities as to what the agendas are, because we all have the same ends, the same goal- that is to help the environment, reduce the pollution and improve sustainability. But what's the path that we take? Everyone has a different opinion on that.
ML: Okay, let's move on. I see your box there…
JO: Yes, my box is actually the original package.
ML: Yes, I can imagine coming from the field with your cucumbers without the plastic sheet.
JO: This is another example of competing agendas. You can see the different suppliers of the materials. You have suppliers who are supplying plastic, paper, metal, glass and each one is claiming that theirs are better. Some are actually coming up with very innovative solutions to reduce the carbon footprint, to make the packaging more sustainable. This is one example which I like, because it actually shows two competing agendas. One of them is about materials - they reduce the amount of plastic, so the plastic inside is thinner, but there is actually paper outside.
ML: Right, this is another composite.
JO: It's a composite, but it's a composite that can be recycled. It says on here “unzip me and recycle both paper and plastic waste separately”. Great idea.
I see, so it has a paper sheet, which has the marketing information.
JO: Which is actually very thick. This alone (the plastic) is too thin to be sold separately. One company that's doing both the paper and the plastic on it is originally a plastic company, but they're doing paper as well now. This (the plastic) is too thin, thus they put this (the paper) on it to help make it stronger in the store, so it doesn't correct. But also, because it's better to print on the paper than to print on the plastic, it's more ecological as well and you can fit more on there. Interesting as well is that this plastic is actually half virgin and half recycled plastic, so it allows them to do more with the plastic as well.
ML: Okay, as a scientist listening to that, that seems to me like a very intelligent solution. It's making the most of the individual materials, their advantages inherent properties.
ML: This plastic is probably a polyethylene or polypropylene plastic, which has got a fantastic properties.
JO: It’s polypropylene.
ML: Yes, so it does not allow any moisture or water in. It's perfect to keep any sort of contaminants away from the product. It's using the tensile properties of the cardboard to reduce the amount of plastic. That sounds good. Then this (the paper sheet) can go into the paper recycling bin. There's a lot of information on there.
JO: That's the other agenda. When we're talking about packaging, there are competing legislative agendas….
ML: I'll need a microscope to read it.
JO: …Yes, exactly. I have no chance, and you are young with good eyes. Imagine…
ML: That's kind of you to say so (laugh).
JO: …Imagine an older lady or man who's in the store trying to read this to figure it out. No chance.
ML: So this is about legislation there. They are obliged to have this there. That's another interesting thing - we're producing a lot of extra packaging, because we have to commit to some sort of information that has been there by various legislative bodies, right?
JO: Yes, and it has to be a minimal size of text as well. It can't be microscopic, even though I would say this is microscopic. Thus, you get the agenda of needing to have the required text and information on the packaging, but also they are competing to reduce the packaging as much as possible. So, it's a competing legislative agenda, and the result is that the consumer is faced with texts that he can't really read.
ML: Quick question. To whom does this belong (example of this product)?
JO: That's a good question. Obviously, it belongs to me, because I bought it.
ML: Should it belong to you? Or should this plastic bit belong to the company that's producing the plastic and should this paper bit belong to the company that is printing out the text?
JO: Well, there's de facto and de jure. De facto it belongs to me because I bought it, but according to law, the producer of it has a responsibility to take care of it even after it's bought. That's why the producers invest in sorting systems, to make sure that the plastic comes back. That's one. The retailer has sold it to me and so the retailer has a responsibility as well, even though less. However, I think the number one de facto is that it's with me now, but if I throw this out on the street, nobody's going to know that Jeff Osterroth threw it away. They're going to see the brand and they're going to believe that it's the brand.
ML: By throwing it away, it actually puts pressure on the brand. And from your insights in the industry, do the companies feel that pressure?
JO: They definitely feel that pressure.
ML: So, when somebody Instagram a bottle or a packaging of some sort and says “This is yours” to the company…
JO: That's a hashtag now.
ML: …are they making any changes?
JO: It is a tremendous pressure from the different sides. Obviously, the producers are responding to legislative pressure that has to be. But also the pressure from the people themselves and the consumers - there is a hashtag. “Is this yours?”, where people take pictures of garbage left on the beach, they tag Coca-Cola for example and they tag it and they say “Is this yours?” Obviously, it's not theirs, but because their name is on it, they feel a responsibility for it. Therefore, they're driven to find sustainable solutions and support sorting and recycling so it's not found or if it is found, it's treated in an environmental way.
ML: I have heard that there seems to be a certain circularity that affects the pressures involved and the way in which developments occur going forward. We are coming to an end, so if you were to summarize your knowledge of all these pressures which are evolving with time, how is that going to impact on our future? What is the future of packaging?
JO: I would have said three or four months ago that we were on a clear path and everybody is moving towards sustainability - producers, retailers, everybody was committed to it. It was obviously a firm part of the strategies of companies. But the world has changed in the last few months. We've written about it and we've studied this. We've talked to many different producers and retailers and we found everybody is saying sustainability is still at the top of our agenda. They say that, they believe that, and we believe that they believe that. The problem is there are different agendas now, which are coming into play. I mentioned the hygiene. We talked about the e-commerce. The third is very important, and that's the economics. If pandemic is followed by an economic recession and companies are laying off people, are they still going to have the money to invest in sustainable solutions? The solutions tend to be more expensive, because you need to develop them, you need to invest in research and development. Secondly, are the people willing to spend more on sustainable packaging and sustainable solutions? Because again, they tend to cost more. Up until now, people were willing to do that. But are they still going to be willing if they're going to have less money in their wallets? That’s uncertain for the future, we don’t know how is this going to play out.
ML: I think we should resolve that uncertainty by inviting you to come back in, let’s say, a year's time to see what has been the long-term impact of the Covid-19 virus.
JO: Yeah, that would be very interesting to see.
ML: Let's hope that the commitment to a sustainable future upholds, and that we found we've become very smart and use our scientific knowledge, our marketing knowledge, our communication expertise to find the right solutions and to tackle these packaging complexities. I’ve got a little packaged present here for you. A very sustainably packaged one.
JO: Thank you. It looks very reusable. I’m sure we'll get to reuse it.
ML: It's a t-shirt with our show. I hope you will enjoy to package yourself (laugh). Jeff, thank you very much for coming to “Let's talk about it”. All the best!
JO: Great, thank you very much.