Interviews

“Consumers now expect the brands they support to be as committed to their mission as they are to their actual products”

Tom Szaky, CEO & Founder of TerraCycle and Loop on the move to a zero-waste lifestyle, shifting consumer expectations and the importance of keeping recycling front of mind.

Izzy Ashton

Deputy Editor, BITE

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The pandemic-induced lockdown that confined consumers across the UK to their homes and made heroes out of key workers also gave people a moment of reflection. A time to pause and examine habits and behaviours of old that perhaps no longer stood up under scrutiny. One such space ripe for examination has been our food consumption and environmental waste habits in the home.

After the panic buying subsided and new routines were created, consumers had little option but to be more considered about the products that they bought. Instead of popping down to the shops every evening, it was perhaps once a week. Meals were planned in advance, recycling bags filled to overflowing and veg boxes were bought in an attempt to stem the flow of food waste that leaves a typical household each week.

For Tom Szaky, CEO and founder of TerraCycle,  however, recycling is just the tip of the iceberg: “While recycling is an important aspect of reducing waste and conserving resources, I will be the first to say that it is only a temporary fix for systemic issue that is present: the culture of overconsumption and disposability,” he explains.

Szaky is also the CEO and Founder of Loop, a zero-waste shopping platform that launched in the UK in July 2020 as a pilot programme with Tesco. It aims to counter the destructive culture of overconsumption. As Szaky explains, “I think people are now paying more attention to the amount of waste that they create. We need to move away from buying disposable, single-use items, which are only useful once, then end up in the trash.”

Brands that aren’t willing to adapt and offer the change that consumers are demanding will be left behind.

Tom Szaky

A convenient, climate-friendly choice

Ultimately if consumers are going to change their behaviour, businesses need to make it easy for them to do so. This is where Loop comes in. Through the platform, consumers are able to order a wide range of products, from juice to shampoo, moisturiser and washing liquid. These are then sent in customised, brand-specific refillable packaging.

All the shopper has to do is pay a deposit fee on each piece of packaging which is then fully refunded to them once the empty container is returned. The process of returning has also been simplified with consumers able to order pickups from their home or drop off the containers at a DPD collection point. “Cleaned and refilled products are simultaneously replenished as needed to the consumer, creating a convenient and safe zero waste shopping system,” says Szaky.

Loop is an example of a brand stepping up to deliver a solution to a problem consumers almost didn’t know they had. And consumers are responding in kind. Indeed, during the months of March, April and May 2020, the Loop platform saw a 30% increase in sales.

A zero-waste lifestyle

“The zero-waste lifestyle is also getting more and more exposure, especially in the media and amongst influencers,” explains Szaky as he talks about the growing market emerging in the form of bulk stores or packaging-free aisles in the supermarket.

“Consumers are now leaning towards the brands that are doing something different and providing more sustainable options,” says Szaky. It is, he feels, down to the businesses who sell larger volumes to step in; they are the ones who will be able to affect the greatest change in the market. What is vital is that they track their consumers’ behaviour, their specific wants and needs. Under extended lockdown and a societal shift to remote working this has meant people shopping more locally or choosing on-demand grocery services and relying more heavily on e-commerce for everyday essentials.

As consumers look to create less waste, this presents an opportunity for those businesses willing to offer them solutions. As Szaky believes, “Brands that aren’t willing to adapt and offer the change that consumers are demanding will be left behind.”

When cash comes with strings attached, sometimes it's not worth it, especially for a mission-based business.

Tom Szaky

Striking the right balance

Szaky is keen to point out however that these zero-waste solutions still remain often difficult for people to access. He believes it’s vital to tread the line carefully: “There is a balance to be struck between being environmentally friendly and appealing to consumers and the ease of use they have become accustomed to.”

For Szaky with Loop it was about creating a sustainable solution that was both comparable to, or even exceeded, standard market products. This, he believes, is vital to any sustainable business’s chance at success. “Many entrepreneurs starting sustainable businesses fall into what I would call the ‘do-good’ space; their business model hinges on the idea that consumers will give them money for a product or service simply because it is the right thing to do. But that’s not enough,” he explains.

He reveals that he turned down a $1 million investment opportunity for the business because it came with conditions that meant he’d have to tone down environmental aspects of the business. He admits that while it was a hard road to take early on, it created a key moment of learning and creativity for the entire team. “When cash comes with strings attached, sometimes it's not worth it, especially for a mission-based business,” he adds.

Shifting consumer expectations

The coronavirus crisis has created an environment in which no brand is left un-scrutinised. This has meant brands have had to tread carefully as they navigate a new world and market to an ever-shifting consumer. “It’s becoming clearer by the day that consumers now expect the brands they support to be as committed to their mission as they are to their actual products,” explains Szaky.

Consumers expectations are shifting as they look firstly to how brands responded to the crisis and how they prioritised the safety of both customer and employee. And then they examined those who either stepped up to support or stayed silent during the Black Lives Matter protests that swept around the world.

I want to see the day when brands stop spending money on commercials that won’t make the world any better but instead invest those same dollars into engaging consumers through purpose.

Tom Szaky

Keeping recycling front of mind

As the world tries to find its feet amidst the uncertainty that underpins every aspect of life during COVID, businesses are similarly having to do the same. For Szaky, the challenge for both TerraCycle and Loop is staying relevant. As more attention has been paid to combating the environmental crisis and to waste solutions, TerraCycle has been able to grow significantly over the last few years. “With that tailwind, we were able to recycle more waste, launch Loop and activate the TerraCycle Foundation,” explains Szaky.

But when the coronavirus crisis descended, people’s focus shifted, becoming singularly centred around what the pandemic meant for them, their families and careers. “When big, nasty global events occur, recycling is not a top priority,” says Szaky. “So, it’s not a competitive threat, but about relevancy. If people’s focus shifts to something else, sustainability might get deprioritised since we can only think about so many things at once.”

For Szaky he believes that finally companies like TerraCycle and Loop are helping other businesses to realise that, “in their core, they can win by investing in recyclability and leveraging that fact.” I want to see the day when brands stop spending money on commercials that won’t make the world any better but instead invest those same dollars into engaging consumers through purpose,” he adds.

It is this purpose that has driven Szaky since he first founded TerraCyle from his dorm room at Princeton University. For him, the process of setting up his own businesses has been one of recognising that, “every failure is an opportunity to learn. Failing fast but learning faster is a fact of life.” Brands take note; sustainable options are now the norm and, if Szaky has anything to do with it, they’re not going anywhere.

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