Sustainability and Giftpacks. Who Blinks First?
- Drinks Provisionist
- Jan 30
- 3 min read
In the ever-evolving landscape of consumer behaviour and environmental consciousness, the drinks industry is facing a pivotal crossroads in its approach to packaging. For years, value-added packs (VAPs) and gift-with-purchase (GWP) strategies have been go-to promotional tactics, particularly during peak seasons like Christmas. Yet, as consumer expectations shift towards eco-friendliness and sustainability, the future of these conventional packaging techniques hangs in the balance.
The demand for change
Over the past five years, the global demand for gift packaging has seen steady growth at a rate of 3.3 percent annually, according to Future Market Insights. GWP and giftpacks have long been staples of the drinks industry's playbook, especially in categories where gifting plays a significant role. However, a seismic shift is underway, driven by mounting pressure from governments, drinks journalists and consumers to take greater responsibility for their environmental impact.
The UK is witnessing a dual-fronted surge in environmental pressures. The launch of a plastic packaging tax in 2022, coupled with an extended producer responsibility program set to start in 2024, signifies a heightened financial burden on producers using less sustainable materials. Simultaneously, consumers are increasingly vocal about their preferences for sustainable packaging. Trivium Packaging's 2022 Global Buying Green Report indicates that 86% of consumers under 45 are willing to pay extra for sustainable packaging, and over half of consumers are less likely to purchase products they deem to have environmentally harmful packaging.
Rising to the challenge
Across the drinks industry, sustainability initiatives are taking centre stage. From Johnnie Walker's viral yet still-to-be-realized paper bottle to Absolute's partnership with a paper bottle manufacturer, the shift towards eco-friendliness is undeniable. This change is particularly crucial given that 20-40% of a spirit's carbon footprint can be attributed to its packaging, contributing significantly to packaging waste in municipal streams.
The pandemic exposed supply chain vulnerabilities that disrupted the Christmas trading period. While this provided a temporary level playing field, the resumption of normal operations presents new challenges. Sustainability has transcended the status of a mere trend and now ranks among the top factors influencing consumer brand choices. According to IWSR research, nearly half of US alcohol consumers consider a company's sustainability initiatives when making purchasing decisions.
The way forward: sustainable packaging
Premium alcohol brands often adhere to similar off-trade promotion strategies, with visibility and rate-of-sale driving initiatives forming the core of their playbook. However, sustainability is becoming an increasingly critical factor in these strategies. Some brands are offering consumers the option to choose whether they want their product gift packed or not, recognising that while the box adds to the experience for some, it may not be necessary for all.
As brands grapple with the sustainability challenge, alternatives to traditional VAPs (Value Added Packs) and GWPs (Gift With Purchase) are emerging. Brands are also switching to eco-friendly materials and investing in reusable packaging. Louis Roederer, for instance, employs fully recyclable and sustainable certified cardboard for its gift packaging. However, identifying and managing these sustainable materials remains a challenge for waste management companies.
A call to action
Consumer demand for sustainably produced goods is on the rise, indicating an irreversible shift in preferences. Established brands are witnessing the rise of sustainability as a pivotal criterion, while emerging spirits brands are realising that embracing eco-friendly initiatives can offer a competitive edge in a crowded market.
In the quest for a more sustainable future, the drinks industry faces the challenge of marrying innovation with environmental responsibility. From eliminating wasteful packaging to exploring greener alternatives, the path to sustainable packaging is both an obligation and an opportunity. As the industry grapples with these changes, brands that rise to the occasion stand to gain not only consumer favour but also a more resilient and ecologically sound future.
Drinks Provisionist partner with brands to tackle these tough issues. We’ve demonstrated that value add at point of purchase can go beyond the traditional giftpack or widget gift. Content, be it in the form on online videos, exclusive online tasting experiences or overlaying opportunities to attend real world events offer consumers genuine value and offer brands opportunities to deepen the connection with consumers.
Our in-house content teams can help produce evergreen assets that are truly scalable, and much kinder to the environment. With consumer’s caught between seeking value and aligning to their values, can your brand afford not to change?
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