Compostable or Zero Waste Products in F&B Industry

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Compostable or Zero Waste Products Trends (1)

Some trends around zero waste products in the US include the emergence of plant-based plastics, also known as bio-plastics, and the use of edible food packaging.

Emergence of Plant-Based Plastics

Use of Edible Food Packaging

RESEARCH STRATEGY

In order to identify trends around zero waste products in the US, we read through industry expert platforms, journals, research platforms and news articles. The sources we read through allowed for the identification of the required trends. To establish them as general trends, we identified the ones that were listed as trends in at least two or three of the sources.
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Compostable or Zero Waste Products Trends (2)

Some trends around zero waste products in the US include use of plantable packaging and emergence of paper bottles.

Plantable Packaging

  • Plantable packaging contains seeds in its pulp, which sprout once placed in the soil. After decomposing, it leaves herbs, flower, or vegetables behind with no waste. Plantable packaging is touted to be the epitome of the zero-waste concept, as it leaves no trace in the environment.
  • Plantable packaging is ideal for small cosmetic boxes and other lightweight items, toppers, or product wraps. It can also be shredded to fill boxes. However, numerous creative things can be done with plantable packaging with a great impression.
  • A key driver of this trend is a swelling wave of legislation that is forcing businesses to take sustainable actions towards zero waste. For instance, Seattle has banned use of Styrofoam in packaging.
  • Consumer expectations are also driving this trend. A study by Nielsen Global Corporate Sustainability showed that 66% of consumers are willing to pay more for products committed to environmentally friendly practices.
  • One of the companies pushing the trend is Pangea Organics. Its creative slogan “Coming from earth and going back to it” captures the core concept of plantable packaging.
  • Pangea Organics collaborated with Seeds of Change and UFP Technologies to develop a 100% compostable molded fiber box packaging for body and skin-care products. The packaging could sprout once planted, giving life to medicinal herbs.
  • Bloom Chocolate also puts seeds in its biodegradable packaging. The seeds grow the same plant used to make the company’s natural flavorings such as mint, orange, and rose.

Paper Bottles

  • Paper bottles have drawn tremendous interest from various consumer packaged goods firms. The bottle needs only 5g of plastic. 75% of the assembly materials are obtained from renewable sources and are compostable.
  • Paper bottles need an inner barrier that contains liquids and averts gas permeability. Thus, they can be used for various purposes such as packaging beer and carbonated soft drinks.
  • A major driver of this trend is the desire to beat plastic pollution as climate crisis escalates. Daunting images of plastic water bottles floating on beaches has prompted companies to take the initiative to reduce the plastic footprint.
  • Mushrooming laws aimed at tackling plastic waste are also driving this trend. For example, the proposed legislation to tackle plastic waste by Senator Tom Udall and US Representative Alan Lowenthal will force packaging companies to shift their focus to zero-waste packaging products such as paper bottles.
  • Coca-Cola is one of the companies pushing for the adoption of this trend. It recently joined the paper bottle community aimed at bringing sustainable packaging solutions to the bottle industry.
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Compostable or Zero Waste Products Trends (3)

Smart packaging and the loop shopping model are some trends around zero waste products in the US.

Loop Shopping Model

  • The loop shopping model is a zero-waste rising trend that is driven by the increasingly high cost and failure to recycle. The increasing acceptance of durability rather than disposable packaging also drives this trend.
  • The loop shopping model is a unique system geared at making sure consumers get different products from top brands in a carrier or unique package that is reusable.
  • After consuming the product, a circular system is created whereby the packaging used is collected, sanitized, refilled, and reused; hence, a loop is created.
  • According to Tom Szaky, CEO and president of TerraCycle, the loop shopping model gives brands and retailers room to create supply chains and products that can withstand the test of time.
  • About 300 products are offered by the loop system and a lot of these products are from leading brands such as Coca-cola, PepsiCo, Procter & Gamble, and Nestle and are used every day in America.
  • Some companies in the US that are pushing for the adoption of this trend include Nestle, Clorox, and Lesieur.
  • Lesieur and Clorox have created containers such as stainless steel wipe containers, vegetable oil containers, and mayonnaise containers using the loop system.
  • Using the loop shopping model, Nestle has created a stainless steel ice cream container for its Häagan-Dazs brand and also changed the disposable containers of some of its other products.


Smart Packaging

  • Smart packaging generally refers to a type of packaging that upgrades a product experience by being functional, sustainable, and a packaging that is easy to use.
  • Smart packaging is one that can show the freshness of the product based on different criteria such as the level of bacterial growth, temperature, acidity, and so on.
  • The smart package is designed and seen as a device, and has become an asset that is all-encompassed with innovative technological opportunities for the consumer
  • With smart packaging, brands can create what their package does, and how it is put into use by the consumer.
  • While the initial costs of smart packages are higher than disposable packages, it is made in such a way that with each reuse, there is a decrease in the cost, and importantly, there is zero waste since the consumer is not throwing the package away.
  • Smart packaging as a trend is one of the various ways by which the packaging industry is using technology as a sustainable solution to its packaging needs.
  • Some features of a smart packaging system include monitoring a product through its delivery process, an extension of shelf life, limiting spoilage, early detection of contamination, and placing orders automatically when products are low in supply,
  • Others are detection of expired food, self-seal to ensure freshness and a pill package that reminds a consumer when to take or reorder pills.
  • The smart packaging system is a major trend among leaders in the US industry, as it plays a role in drastic waste reduction and also in enhancing sustainability, which ramps up the product's appeal.
  • Smart packaging could either be active or intelligent and can be used in food packaging, cosmetics or pharmaceutical packaging.
  • Smart packaging as a trend is on the rise and is driven by the fact that the use of innovative applications aimed at thrilling consumers has spread throughout different industries.
  • Entities that are pushing for the adoption of this trend include the PKG Brand Design (a design and packaging firm that is based in Chicago) and the SmartPack US.
  • The SmartPack US pushes for the adoption of smart packaging through collaboration with major industry leaders and organization of conferences to create awareness and increase commercial adoption of smart packaging.
  • PKG Brand Design is at the forefront of various CPG packaging initiatives and this includes the use of smart sensors, near-field communication and printed electronics on labeling.

Research Strategy

To identify some trends around zero waste products in the US, the research team went through industry expert platforms, journals, research platforms, and news articles. The team found some sources that identified the required trends. To establish them as general trends, however, we made sure to select the ones that were listed as trends in at least two or three of the sources.
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Compostable or Zero Waste Products Trends (4)

Two additional trends around zero waste products in the US include package-free products and mono-material packaging. Details regarding these trends have been provided below.

Package-Free Products

  • Small and medium brick-and-mortar grocery stores in the United States are gradually getting rid of packaging. The stores sell package-free products for items such as chocolate, toothpaste, among others.
  • Similarly, package-free products are becoming increasingly common in big chains like Sprouts and Whole Foods, which have special sections for packageless goods.
  • The trend is driven by the stores, which are aiming towards achieving zero waste.
  • In stores that have package-free goods, consumers have the option of purchasing recyclable containers or coming with their own bags. In this case, customers only pay for the goods they are buying as their weight is measured without the packaging.
  • Examples of stores that are offering package-products include Nada and Precycle.

Mono-Material Packaging

  • Brand owners and packaging suppliers are now using single-material solutions since they are easily recyclable and have less impact on the environment.
  • As it stands, the trend of mono-material packaging is shifting from polymer protective products to fibre-based products.
  • As a result, protective elements such as moulded fibre inserts are becoming more popular than air pillows and expanded polystyrene shapes, which are difficult to recycle.
  • The trend is driven by the fact that mono-material packaging provides the best options when making recyclable materials. Therefore, manufacturers are following this trend as a way of reaching their sustainable packaging goals and improving customer satisfaction.
  • An example of a company that is pushing the adoption of this trend and using mono-material packaging in its products is Paxxus. As it stands, Stream, the company's brand, focuses on flexible mono-material packing solutions. The brand is now expanding to medical device and life science manufacturers.
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Launching Compostable or Zero Waste Products

To effectively launch compostable products in the United States, providers should consider markets with effective composting and recycling programs, and any law and regulation that govern such products. Also, factors such as certification, field testing, and product labeling are to be considered before the products are launched to the market.

Launch in Markets With Strong Composting and Recycling Program

  • Regions with effective composting and recycling programs are the ideal market for compostable products. A growing number of towns, cities and even states are appreciating the importance of composting programs. In the past years, composting programs offered by communities have risen by 65%.
  • San Francisco, for instance, composts about 255,500 tons of organic material every year. In 2012, the State of Vermont passed a Universal Recycling Law through which they are committed to having all recyclables, and all other organics banned from landfills by 2020.
  • Other municipalities like San Diego, Boston, Austin, and New York are already intensifying their composting and recycling programs.

Consider Markets With Laws and Regulations That Govern Compostable Products.

  • Compostable product providers should also consider markets with any law and regulation related to compostable products. For instance, a state like Washington has proposed a bill, HB 1569, that requires the labeling of such products to be done in an "easily and readily identifiable" manner. The bill is set to be effective as of July 2020.
  • Also, in California, a new bill, SB 54, has been proposed. The bill outlines the requirements for labeling compostable products.

Certification

  • Before compostable products are launched, they must are certified by ASTM (American Society for Testing and Materials) to prevent greenwashing as well as ensure that they are not a detriment to the environment.
  • To meet the standards of ASTM, the individual ingredients of the products are to be tested for biodegradability, and the finished product to disintegrate during composting. The products are also to be tested for heavy metals and plant toxicity.
  • According to the Biodegradable Product Institute, for a product to be certified as compostable, "it must not require disassembly to be composted, and It must have a significant acceptance in several commercial compost facilities." Also, it should not be a redesign of a product that is best used for recycling.

Labeling of Compostable Products is Key

  • Labeling is important as providers can identify their products. It is also helpful in preventing greenwashing. Lack of proper labeling has seen many compostable products in landfills.
  • The USCC has set guidelines for labeling compostable plastic products. There is also a quick guide for compostable food serviceware and legislation for compostable plastics.
  • Compostable bags have so far shown how best such products should be labeled. Some are marked with prominent text like "Certified Compostable" and logos like OK Home Compost and BPI.

Field Testing

Research Strategy

To provide some insights that detail how to effectively launch zero waste products in the US, we analyzed articles and reports about composting from sources like U.S PIRG, Packaging Digest, US Composting Council, Washington Post, and others. These sources provided us with great insights into the relevant requirements for composting products. Further analysis of regions that are committed zero waste management helped us to uncover the markets that are ideal for these products.
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Compostable or Zero Waste Products News Coverage

Major media publications like CNN, Bloomberg, Fast Company, the New York Times, NBC News, the Washington Post, ABC News, and Business Insider have covered stories that highlight composting and zero-waste products in the US. Articles discuss the problem that plastics and other wastes are causing for the environment and present ways that Americans can utilize composting and zero-waste products to develop more eco-friendly lifestyles. Other articles showcase zero-waste efforts that companies and individuals have made.

How to Solve the World's Plastics Problem: Bring Back the Milkman

  • CNN Business published this article by Danielle Weiner-Bonner on January 24, 2019.
  • Weiner-Bonner illustrates how plastic products are a threat to the planet and notes that "plastics are expected to outweigh fish in the ocean by 2050." Landfills are overflowing, green house gases are rising, and climate change is presenting a real threat.
  • Major companies such as Proctor & Gamble, Unilever, and PepsiCo have launched a new shopping service called Loop that delivers products like laundry detergent and food staples in reusable containers packed in a special tote. Consumers then leave the empty products on their doorsteps in the Loop tote for pickup to be refilled. The process is reminiscent of when Americans left empty containers for the milkman in the days before plastic.

14 Easy Product Swaps to Help You Live a More Climate Conscious Life

  • CNN Underscored published this article by Kai Burkhardt on September 20, 2019.
  • Burkhardt references the "global climate strikes" that occurred in response to a UN Climate Summit held on September 23, 2019 and provides examples of zero-waste products consumers can use to begin living in a more eco-friendly fashion.
  • Examples of zero-waste products mentioned in the article include beeswax food wraps, muslin and mesh produce bags, compostable trash bags, and bamboo toothbrushes.

American Consumers Might Save Paper Recycling

  • Bloomberg published this article by Emily Chasan on October 11, 2019.
  • Chasan references the recent rise in plastic straw bans as one of many efforts to cut down on plastic waste, noting that "containers, cartons, wrapping, and everything else discarded after a product is used make up about 30% of all American trash."
  • The article goes on to explain that "more than 200 businesses," including large companies like Coca-Cola, have committed to using cardboard over plastic wherever possible and that this is driving growth in the American paper recycling industry.

Before Tom’s of Maine Could Go Zero Waste, It Had to Figure Out How to Compost Toothpaste

  • Fast Company published this article by Adele Peters on March 25, 2019.
  • Peters highlights Tom's of Maine and its goal to create a zero-waste manufacturing facility. The "biggest challenge" that the company faced in this process was how to handle toothpaste waste during the production process.
  • Its solution was to collaborate with the University of Maine to develop a composting program. Tom's of Maine now uses MB Mark, a "large-scale commercial composting facility," to compost the leftover toothpaste from its manufacturing plants.

They Love Trash

Want a Cleaner Kitchen and a Cleaner World? Get a Composter For Your Food Scraps

  • NBC News published this article by Julie Compton on July 29, 2019.
  • Compton notes that 22% of all waste found in municipal landfills comes from the kitchen and that composting is one solution for kitchen waste reduction.
  • The article goes on to explain how kitchen waste contributes to climate change and then outlines ways to compost at home. It describes how to create the best "compost recipe" by balancing green, nitrogen-rich materials like fruits and vegetables with brown, carbon-rich materials like grass clippings, dried leaves, and cardboard.

How to Break Your Plastic, Foil, and Paper Addiction in the Kitchen

  • The Washington Post published this article by Kristen Hartke on July 9, 2018.
  • Hartke begins by explaining that "Americans throw out 185 pounds of plastic per person each year" and that only 9% of global plastic waste is recycled.
  • The article then suggests ways to reduce the amount of plastic, tin foil, and paper products used in American kitchens. Examples include TerraCycle's zero-waste service that recycles materials local municipalities might not, beeswax food wraps, food-grade silicone, and bamboo products.

Textiles Evolving to Meet Demand for Sustainable Materials

  • ABC News published this article by Katherine Roth on August 8, 2019.
  • Roth discusses how American textile manufacturers are embracing zero-waste practices such as "reducing waste during textile production" and "reusing or recycling waste to produce other products." Major companies like Nike and Adidas have committed to the zero-waste trend.
  • The Fashion Institute of Technology in New York City has its students "experimenting with using milkweed and flax" to produce a plant-based "fur" material.

9 Cheap Solutions for People Who Want to Waste Less and Wean Themselves Off Single-Use Items

  • Business Insider published this article by Kate Bratskeir on June 22, 2019.
  • Bratskeir begins by presenting readers with statistics like "2 million plastic bags are used per minute" and over "480 billion plastic bottles were sold" globally in 2016.
  • The article then lists cost-effective zero-waste products that consumers can use to reduce their dependence on plastic. Examples include reusable water bottles and mugs, wooden flatware, cloth napkins, and bar soap.
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Food and Beverage Compostable or Zero Waste Products

There are a range of compostable and zero waste products in the food and beverage space available in the US market. These products include reusable storage bags, silicone baking mats, and compostable cutlery, among others. Below are ten such products, along with a brief description and a link to one online market on which they can be purchased in the US.

Compostable or Zero Waste Food and Beverage Products

  • BlueAvocado reusable storage bag kits include five resealable bags — three 'lunch size' bags and two 'snack size' bags — allows for zero waste storage of food items. The goal behind this product and others like it is to replace disposable plastic bags for those trying to convert to zero waste.
  • Wild Minimalist glass straws allow for zero waste use of straws in beverages. The straws, which can replace disposable plastic straws, are sold in sets of four and offered in two color sets.
  • Stack Man's 100% compostable plates are made from sugar cane fibers. These completely compostable plates, which are available in single compartment or three-compartment varieties, can be used in place of disposable paper or plastic plates and can be purchased in packs of 125 for $15.49 on Amazon.
  • Silpat's silicone baking mat is a zero-waste replacement for most cooking applications of aluminum foil. They are available on Amazon in a variety of sizes, including medium, half sheet, petite jelly roll, and toaster oven.
  • BioBag's compostable sandwich bags can replace disposable plastic sandwich bags. The bags, which are fully compostable, can store a range of foods and can be purchased on Amazon in sets of 20, 25, 180, or 360.
  • K&J offers reusable K-cups for use with Keurig coffee makers. These K-cups, which are sold in packs of 4 on Amazon, allow for a zero waste alternative to the hard-to-recycle plastic K-cups sold in stores.
  • Treewix offers reusable food wraps made out of beeswax that are a zero waste alternative to disposable wraps made out of plastic or other materials. These wraps are both washable and biodegradable, and as such can be continuously reused or composted.
  • Green Grove compostable cutlery offer an alternative to disposable cutlery made out of plastic or other products. These fully compostable utensils are available on Amazon in sets of 400, including forks, knives and spoons.
  • Harvest Pack's compostable to-go containers offer an alternative to disposable plastic food containers that eateries often use for deliveries or provide customers who want to take food home. They can be purchased on Amazon in sets of 50 for $14.99 or 500 for $99.99.
  • Eco-Products offers compostable cups that can be used in place of disposable cups made out of non-compostable materials like plastic. These cups, which can hold hot or cold beverages, can be purchased on Amazon and are available in a variety of sizes, such as 4 ounces, 8 ounces, and 12 ounces.

Research Strategy

To find the products above, we conducted searches of US online markets, such as Amazon and Wild Minimalist, as well as reports by individuals in the zero waste space. We ensured that each product is available in the US market by entering a US address on the website on which each product was found. We selected products with primary uses in the food and beverage space, though some — like bags or plates — may have some secondary uses unrelated to food or beverages.
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Compostable or Zero Waste Products Competitive Analysis (1)

The top six players that provide zero waste products in the US include Toyota, Microsoft, Google, Procter & Gamble, Unilever, and Subaru.

1. TOYOTA

  • Toyota is a vehicle manufacturing and sales company based in Japan. However, it also engages in finance and vehicle leasing, the manufacture and sale of houses, information communication, "the control of manufacturing and sales companies, as well as public relations and research activities in North America and Europe by subsidiaries."
  • Its automobile products include "sedans, minivans, 2box, sports utility vehicles, trucks, and related vehicles, as well as related parts and products."
  • The company has 27 zero-waste facilities in North America and is one of the founding members of the US Zero Waste Building Council. All of Toyota's facilities in the region meet the Building Council's criteria for zero waste.

3. GOOGLE

  • Google is an internet company that advertises and engages in the sales of digital content, applications, cloud offerings, and hardware products.
  • Among its software products are AdWords, AdSense, Google Display, DoubleClick Ad Exchange, and YouTube.
  • Its hardware products include smartphones, PCs, tablets, and accessories.
  • The company has 14 data centers, six of which are zero waste. It also recycles and reuses 86% of its non-data centers waste.
  • Google also aims at reducing organic waste and is taking huge steps toward composting.
  • Google's latest revenue release in 2018 placed it at $136 billion.

3. MICROSOFT

  • Microsoft Corp. is a tech company with productivity and business processes and intelligent cloud and more personal computing segments.
  • The company develops, licenses, and supports several software products, including "operating systems, cross-device productivity applications, server applications, business solution applications, desktop and server management tools, software development tools, video games, and training and certification of computer system integrators and developers."
  • Its hardware products include tablets, personal computers (PCs), video game consoles, mobile phones, as well as other smart devices and accessories.
  • Microsoft was the first technology company to receive zero-waste certification from the US Zero Waste Building Council, globally.
  • Microsoft's annual revenue as of 2019 was over $125 billion.

4. PROCTER & GAMBLE (P&G)

  • Procter & Gamble is the world's largest producer of consumer packaged goods (CPG) products. It serves consumers around the world through its "beauty, grooming, health care, fabric & home care, and baby, feminine & family care" segments.
  • P&G has its largest market in the US. However, it sells its products to over 180 countries under "Olay, Old Spice, Safeguard, Head & Shoulders, Pantene, Rejoice, Mach3, Prestobarba, Venus, Cascade, Dawn, Febreze, Mr. Clean, Bounty, Charmin," amongst other brands.
  • Some of its products under these brands include baby diapers, detergents and soaps, paper towels, toilet papers, facial tissues, feminine care pads, tampons, dishwashing liquids, razors, shaving gels, supplements, toothbrushes, and toothpaste, among others.
  • Currently, 55% of P&G sites are zero-waste, and the company is committed to ensuring that it eliminates 95% of manufacturing waste.
  • The company's 2019 revenue was $67.7 billion.

5. UNILEVER

  • Unilever is a leading global provider of fast-moving consumer goods in a range of categories, including "savory, dressings and spread, ice cream and beverages, personal care, and home care." It has an array of brands such as Dove, Axe & Lynx, Blue Band, Lipton, and Rexona, among others.
  • Unilever's personal care products include skin care and hair care products, deodorants, and oral care products.
  • Laundry tablets, soap bars, and powders are among its home care products, as well as a range of cleaning products
  • "Its soups, bouillons, sauces, snacks, mayonnaise, salad dressings, margarine and spreads, and cooking products such as liquid margarine," are under its food products category.
  • Unilever's refreshment products include "ice cream, tea-based beverages, weight-management products, and nutritionally enhanced staples."
  • The company has 224 factories and 400 zero-waste sites globally, which have saved them $225 million.
  • Unilever is committed to make all its packaging reusable, recyclable, or compostable by 2025.
  • Its revenue as of 2019 was $66.5 billion.

6. SUBARU

  • Subaru, formerly known as Fuji Heavy Industries Ltd., is an industry leader in the manufacture and sales of "automobiles, aircraft, engine parts, and industrial machines." Its manufacturing plants are located in the US and Japan.
  • The company's operations are executed in four primary segments, including automobile, aerospace, industrial products, and others.
  • Subaru has been producing zero waste products in these segments for 12 years, as everything in the company is either reused or recycled.
  • As of 2019, the company's annual revenue was $19.6 billion.

RESEARCH STRATEGY
We found a list of the top players that provide zero waste products in the US from Durability Matters. However, this list comprised 11 companies. As such, we sourced through each one to identify the top based on their revenues and have provided our finding above for the same.
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Part
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Compostable or Zero Waste Products Competitive Analysis (2)

The marketing and branding strategy, consumer response to their products, and competitive advantages of three of the top six companies who provide zero-waste products in the US, Toyota, Microsoft, and Google, are provided below.

Toyota

  • Toyota's brand strategy has historically been based on safety and quality, but they have broadened their focus to be a 'mobility company', with a significant focus on innovation and environmental-friendliness. The attributes of safety, quality, as well as eco-friendliness, are now communicated as part of Toyota's vision to be at the forefront of leveraging technology and offering solutions that meet consumer's needs.
  • Toyota's marketing strategy leverages multiples channels to drive their brand message forward, including dealerships, traditional and digital media, and event-driven marketing. At the core of their marketing strategy is a strong focus on product performance and innovation that supports the strategy (for example, the Toyota Prius hybrid, which is an example of sustainable mobility) and partnerships (such as one with SoftBank, an artificial intelligence specialist), to test autonomous delivery services such as portable medical treatment and product delivery.
  • Other examples of Toyota's marketing strategy include the "mobility for all" campaign, in which Toyota showcases prototype concepts which 'give all of humankind the freedom to move'. Event-driven marketing has also been used to showcase innovation that supports their brand and mission, at auto-focused events, such as Formula 1 and North American International Auto Show.
  • Consumers have ranked the Toyota product lineup highly for several years, noting its comfort, safety, and availability of eco-friendly options. The Toyota Prius received a 4.7/5.0 rating on Kelly Blue Book across 23 reviews. According to a Harris Poll survey, which reflects US consumer brand reputation and perceptions, Toyota ranked #37 in overall brand reputation and #19 in product/service reputation.
  • Toyota's competitive advantages include its brand strength (positive consumer perceptions enable trust when new innovations rolled out), technological advancement (based on company-specific R&D and expertise), corporate support and resources for innovation, and the ability to compete on cost and price (based on the "Toyota Way", which maximizes production efficiency and minimizes losses to optimize performance). Toyota emphasizes these technological and innovation advantages on their company website.

Microsoft

  • Microsoft brand strategy transitioned from a product-focused strategy in 2014 to its current strategy, which is human-focused, linking their brand and technology to its benefits to the planet. Microsoft states its goal is to "empower every human on the planet to achieve more." Their brand communication is focused on ensuring the Microsoft brand is associated with being beneficial to small businesses, multinationals, non-profits and governments.
  • Microsoft aims to communicate a unified brand message, across various channels (traditional, digital, and social), in which company and product brands support and complement each other. For example, Microsoft strives to associate the empowerment message of the overarching Microsoft brand with other products in their portfolio, such as XBox and Skype.
  • Consumers generally trust Microsoft products, with goodwill being generated by a history of product innovation and quality. Consumer response to Microsoft products overall is high, generating 4/5 stars across 1,116 reviews on Consumer Affairs. According to a Harris Poll survey, which reflects US consumer brand reputations and perceptions, Microsoft ranked #9 in overall brand reputation and #5 in product/service reputation.
  • Microsoft has numerous competitive advantages. These include brand equity (based on a history of innovation and consumer trust), product range (including market leaders MS Office and Windows OS and acquired platforms such as LinkedIn), and global presence and large scale distribution network. Microsoft leadership is also a competitive advantage, reflected in innovation through smart acquisitions to diversify and build their brand, repositioning of brand messaging to be more consumer-centric and improving HR management and work culture.

Google

  • Google's marketing and brand strategy involves ensuring their mission, "to organize the world's information, and make it universally accessible and useful", is fulfilled. Their strategy involves offering a product line which makes consumer's lives easier, commitment to improving the lives of as many people as possible, and focusing on positive changes made by consumers enabled by Google technology.
  • Google's marketing strategy focuses on the holistic brand, not product-specific marketing. The brand message is "Google Helps People" and is intended to convey a unified impression of their brands under one umbrella, drive incremental product usage by ensuring their products are helpful to consumers and create a positive impression of the brand.
  • Google consumers generally respond positively to their products, with Google Chrome generating an average 4.5/5 stars across 752 reviews on respected consumer review site, G2, and Google Play generating an average review of 4/5 stars on Consumer Reports across 3,637 reviews. According to a Harris Poll survey, which reflects US consumer brand reputations and perceptions, Google ranked #41 in overall brand reputation and #12 in product/service reputation.
  • While their reputation at the moment is strong, Google trust among consumers may be starting to erode, due to numerous product de-listings in 2019.
  • Google's competitive advantages are their scale and intellectual property. Google conducts 3.5 billion internet searches each day, enjoys a 75% share of search queries, and its targeted advertising addresses 92% of internet users. The algorithm underlying its search engine is frequently modified based on internet activity, which allows it to remain the fastest, most comprehensive search engine available.

Research Strategy

We reviewed the corporate websites and annual reports of each business to understand their mission in building their company and brands and developing a marketing strategy to support the mission. We then reviewed business and marketing publications, such as Forbes, to gain additional perspective on the marketing and brand strategies employed by these organizations. To assess consumer response, we leveraged Harris Poll annual brand reputation survey of over 18,000 US adults 18+, which provided overall brand reputation as well as consumer perception of products/services. We complemented these ratings with other product-specific ratings sources such as Consumer Reports and Edmunds. Finally, we leveraged company-stated highlights of their priorities, successes, and advantages, coupled with outside business and financial sources and marketing publications, to provide a summary of each company's competitive advantages.
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Part
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Compostable or Zero Waste Products Competitive Analysis (3)

Procter & Gamble, Unilever, and Subaru all have positive responses among U.S.-based consumers. Procter & Gamble and Unilever leverage data and analytics for a more effective targeted marketing. Subaru combines targeted with bold marketing to achieve high sales in the United States.

Procter & Gamble

Marketing Strategy

  • Procter & Gamble (P&G) reinvented its marketing strategy in 2018 to expand its reach and to minimize wasteful spending.
  • In the new strategy, P&G sought to leverage data and analytics to refine the reach of its adverts. P&G moved from "broad and generic demographic targets such as 'women ages 18-49' to 'smart audiences' with precision and scale."
  • Apart from targeting probable customers, the company uses data and analytics to select the most suitable influencers for their marketing campaigns. Digital is P&G's main marketing channel.

Consumer Response

  • In 2018, five of P&G's products won Kantar TNS' "Product of the Year USA" awards in a variety of categories ranging from beauty and personal care to household essentials and pet care. Over 40,000 U.S.-based consumers voted on products from 31 different categories.
  • According to the Harris Poll survey, which reflects US consumer brand reputations and perceptions, P&G ranked eighth in overall brand reputation and sixth in product/service reputation.
  • P&G is the largest advertiser in the United States by marketing expenditure, which is reflected in its marketing strategies.

Competitive Advantage

  • The company has also been in existence in the United States for over 180 years, which has allowed it to build a trusted and recognizable brand name.
  • Additionally, P&G enjoys significant brand equity, economies of scale, excellent research and development strategies, an excellent distribution channel, and high profit margins.

Unilever

Marketing Strategy

  • Unilever follows a data-driven advertising approach. The company's communications are now driven by "a deliberate and data-driven audience segmentation and programmatic approach to media buying."
  • Similar to P&G, data and analytics has advanced Unilever's targeting capabilities. The company's marketing campaigns are more efficient because its new data-driven approach has enabled it to identify audience segments more accurately.
  • Unilever also started focusing more on digital marketing. In December 2019, the company expanded the title of the 'Chief Marketing Officer' to 'Chief Digital and Marketing Officer' in an effort to transform Unilever into a "fully digitized organization at the leading edge of consumer marketing."

Consumer Response

  • Consumer response to Unilever's products is positive with the United States accounting for the majority of Unilever's sales at about $8.3 billion in 2018. The U.K. and the Netherlands (its home countries) accounted for about $3.7 billion only.
  • In 2017, Unilever trumped its rivals in the United States including P&G, Colgate-Palmolive, and Kimberly Clark Corp. This was due to its lower prices in a market that favors discounts and budget products.
  • In 2018, Unilever's Dove and Ben & Jerry's were named in the "Top 50 Prophet Brand Relevance Index." These are brands that Americans cannot live without. Dove also made the list of the "Top 25 Most Loved Brands in America" in 2019.
  • According to the Harris Poll survey, which reflects US consumer brand reputations and perceptions, Unilever ranked 25th in overall brand reputation and 20th in product/service reputation.

Competitive Advantage

  • Unilever's competitive advantages include a reputable and renowned brand name, a diversified product range, excellent distribution channels, significant investment in research and development, flexible prices, a strong workforce, economies of scale, extensive CSR activities, and commendable marketing capabilities, among others.

Subaru

Marketing Strategy

  • In the United States, Subaru leveraged targeted marketing to achieve sales above those of larger competitors including Volkswagen by a wide margin in 2018. Analysts say that Subaru's clever marketing strategies are instrumental to its success in the U.S. market.
  • Subaru also tries to differentiate itself from the rest through its marketing campaigns by not following the norm. For example, in 2008, Subaru shifted to "emotion-based advertising" when all competitors were price, features, sales events, and deals. Additionally, Subaru might have been the first company in the United States to target LGBTQ communities specifically.

Consumer Response

  • Subaru's market share in the United has risen from about 0.9% in 1997 to about 3.92% in 2018. This represented a growth from 133,783 units to 680,135 units, respectively.
  • Also, Subaru enjoys high scores in consumer surveys. In 2019, Consumer Reports reported that the "Subaru Ascent was ‘top pick’ in the midsize SUV category while the Subaru Forester was best pick among compact SUVs." This was especially impressive since Subaru had just updated its models.

Competitive Advantage

  • In the U.S., Subaru has built a reputation as a socially-conscious brand. Apart from being among the first to embrace LGBTQ communities, the company supports several other causes. Because of this positioning, Subaru has higher-income consumers than most non-luxury vehicle brands.
  • Subaru's exceptional marketing is complemented by appealing and relevant products. All but one Subaru products are available standard as all-wheel, usually at a similar price to two-wheel drive options from competitors.

RESEARCH STRATEGY

We explored the websites and annual reports of the companies to determine their marketing/branding strategy, consumer response to their products, and competitive advantage. We also reviewed financial resources including Forbes and marketing publications such as Marketing Week to gain additional insights on the required information. We reviewed consumer survey sites such as the Harris Poll, Consumer Reports, and Kantar TNS to determine consumer responses to their products. To provide a summary of each company's competitive advantages, we leveraged media reports as well as SWOT analysis by marketing resources. Notably, some information on Unilever and P&G did specifically identify the U.S. as the scope; however, we assumed that it was relevant to the U.S. because it was provided by U.S.-based/focused resources, and also because the U.S. represents their largest markets and any marketing activities/strategies identified by its leadership would likely be focused there.
Sources
Sources

From Part 09
Quotes
  • "At a time when many are calling attention to the role technology plays in society broadly, our mission remains constant. It grounds us in the enormous opportunity and responsibility we have to ensure that the technology we create always benefits everyone on the planet, including the planet itself. Our platforms and tools help make small businesses more productive, multinationals more competitive, nonprofits more effective, and governments more efficient. They improve healthcare and education outcomes, amplify human ingenuity, and allow people everywhere to reach higher."
Quotes
  • "The company introduced a new mission statement, “Empower every person and every organization on the planet to achieve more”, to give a sense of unity to its separate business entities."
  • "Additionally, Microsoft placed a stronger emphasis on communicating the overarching brand to make sure that people associate Microsoft with some of its famous products, including Xbox and Skype. Before that, Microsoft had been known for its product-centred communication."
  • "Now, it focuses on consumer benefits instead. Microsoft has also changed its tone of voice, stopped using corporate jargon and started adopting a more human and emotional style."
Quotes
  • "Another company that must manage its corporate image along with many separate products in digital marketing is Microsoft. Microsoft has perhaps one of the most complex brand hierarchies with products spanning online, such as Skype, Bing, and Internet Explorer; to business productivity software, like Dynamics or SharePoint; to developer/IT solutions, such as Visual Studio, SQL server and Azure; to consumer products across mobile, cloud storage, email, and gaming."
Quotes
  • "Overall Satisfaction Rating 4/5 stars, based on 1,116 ratings submitted in the last year"
Quotes
  • "Strong brand equity is a major source of competitive advantage for Microsoft. Brand Equity of Microsoft rests on the trust it has created and the efficiency of its products. "
  • " The company has managed strong relationships with customers. Focus on CRM and innovation has also resulted in strong goodwill."
Quotes
  • "Our mission is to organize the world’s information and make it universally accessible and useful."
Quotes
  • ""We have a very strong brand, but it's important that we tell that brand story and almost remind people about the Google that they love.”"
  • "Additionally, research carried out by Chow’s team has shown that product usage and engagement increases when Google spotlights its holistic brand, rather than concentrating on product-specific marketing."
  • "To devise a new brand message that would set it up for the next decade and beyond, Google put two teams on the job – Chow’s product marketers and its internal Brand Studio. After months of research they both arrived at the same conclusion, which became the new core message: Google helps people."
  • "“When we tell people that, they get it – it resonates with them,” he said. “But it also has that humbleness of Google: the idea that it's not about us and it's not about how fancy technology is. It's more – is it useful for you? And if it is, then we're happy.”"
Quotes
  • "Microsoft #9 overall and #5 in Product/service perception. Toyota #37 overall and #19 in product/service perception. Google #41 overall and #12 in products/service perception."
  • "The RQ Ratings phase survey is conducted online in English and takes place among the general public, adults 18+. Respondents are randomly assigned to rate two of the companies with which they are “very” or “somewhat” familiar. Each interview lasts approximately 20 minutes. This year’s rating interviews took place online between January 2nd to 18th, 2019 among 18,228 U.S. adults to obtain an average of approximately 300 ratings per company."
Quotes
  • "We are 91 days into the year, and so far, Google is racking up an unprecedented body count. If we just take the official shutdown dates that have already occurred in 2019, a Google-branded product, feature, or service has died, on average, about every nine days."
  • "Some of these product shutdowns have transition plans, and some of them (like Google+) represent Google completely abandoning a user base. The specifics aren't crucial, though. What matters is that every single one of these actions has a negative consequence for Google's brand, and the near-constant stream of shutdown announcements makes Google seem more unstable and untrustworthy than it has ever been. "
  • "For a while there has been a subset of people concerned about Google's privacy and antitrust issues, but now Google is eroding trust that its existing customers have in the company. "
  • "In addition to the endless memes and jokes you'll see in every related comments section, you're starting to see Google skepticism in mainstream reporting, too. Over at The Guardian, this line makes the pullquote: "A potentially sticky fact about Google is that the company does have a habit of losing interest in its less successful projects." IGN has a whole section of a report questioning "Google's Commitment." From a Digital Foundry video: "Google has this reputation for discontinuing services that are often good, out of nowhere." One of SlashGear's "Stadia questions that need answers" is "Can I trust you, Google?""
Quotes
  • "Google Play Consumer Reports rating 4/5 stars, 3,632 reviews."
Quotes
  • "Google Chrome 4.5/5 stars across 752 reviews on G2, a respected and real-time user review site."
Quotes
  • "The network effect (service becomes more valuable to all as system adds more users) is clearly the case with Google's search business, and the company's advantage here is significant and sustainable. Googe's search-engine service improves as more searches are conducted by users, and as websites optimize themselves to figure prominently in Google search results."
  • "Scale is also at work in Google's advertising network, which delivers advertising relevant to Internet users based on profiles of their interests. The more that Google learns about its users through their searches, the better its targeting ability becomes."
  • "3.5 billion: The number of Internet searches made via Google every day. Google's market share in internet search stands at 75%. As long as Google controls three-fourths of the market for search queries, its moat is deep and wide. The company's targeted advertising reach is even greater, addressing 92% of all Internet users in the United States."
  • "Ultimately, the core of Google is the search algorithm, which is frequently tweaked in response to changes in the Internet environment. This algorithm, and Google's ability to deliver the fastest, most comprehensive search, is fundamentally responsible for creating the scale advantages that Google enjoys today. While not necessarily protected by patents or trademarks, the accumulated knowledge and computer code that underlies Google's products would be difficult to replicate and must thus be considered part of the company's moat."
Quotes
  • "The Toyota Motor Sales U.S.A., Inc. Mission and Vision Statements are as follows: Mission Statement: "To attract and attain customers with high-valued products and services and the most satisfying ownership experience in America." Vision Statement: "To be the most successful and respected car company in America.""
Quotes
  • "We’re in the business of making great cars and trucks. But we also work every day to apply and share our know-how in ways that benefit people, the community, and our planet in order to build a better tomorrow."
  • "We create vehicles by listening and responding to you. Why? Because it’s our belief that our cars should do more than help you go places on the road, they should also help you go places in life."
  • "We make vehicles that respond to, and anticipate, your needs for the way you live today — with advances in sustainable mobility and advanced safety technologies. Find out more about how our operations are improving the world we live in today and long into tomorrow."
  • "There is only one planet Earth. Which is why we developed a line of vehicles that make the best possible use of our natural resources, and why we ensure that our facilities and plants minimize waste and energy while maximizing efficiency."
  • "We're constantly innovating and researching ways to help prevent accidents from ever happening, as well as help protect those inside and outside of our vehicles in the unlikely event of an accident. Then we share our research and data with a variety of universities, government institutions and more to help make the roads safe for everyone."
  • "We’ve contributed over $700 million to support safety, education, and environmental initiatives across the U.S. since 1991. And, we share our production know-how with nonprofits and community partners from food banks to hospitals — to help them serve more people, more effectively."
Quotes
  • "Technology is transforming the way we move and making the world more connected. People are accustomed to ride sharing and electric vehicles, while autonomous vehicles are being rolled out at scale. This connectivity has changed consumer beliefs in regards to ownership and sharing communal assets. It has also set the the bar for environmental standards and technology."
  • "Toyota is an excellent example of a company combining this technology along with design and purpose. The automaker is dedicated to paving the road for the “future of mobility." This mission acts as a compass, influencing key strategy decisions in branding, product innovation, partnerships and more."
  • "By focusing on mobility, Toyota is expanding its business to car-sharing. The lesson here is that to drive innovation with purpose you must identify what people need, what's holding them back and how your company can help others live better."
  • "To drive innovation with the aim of advancing mobility, Toyota is partnering with SoftBank. SoftBank, with a specialty in artificial intelligence, and Toyota, with a long history of transportation solutions, will release a joint venture called Monet Technologies Corp. The partnership will focus on delivery services, portable medical treatment, on-demand vehicles and data assessment. They also have plans to release autonomous delivery services by 2020."
  • "To build both social impact and the bottom line, you must weave purpose into product development. Toyota has been driving innovation for years, rolling out Hybrid Synergy Drives technology and the Prius, which set the standard for hybrid cars and has continued to innovate ever since."
  • "Essentially, Toyota combined social good with technological expertise and inspirational storytelling to create life changing product innovations that grab consumer attention."
Quotes
  • "When reviewing the Toyota lineups overall quality, consumers have ranked the brand highly for several years. Furthermore, without forgoing style, the Toyota brand consistently provides comfort and safety. "
  • "Additionally, the Toyota brand offers a variety of eco-friendly options that consumers can choose from, including the hybrid versions of the Toyota Camry, Toyota Avalon, Toyota Rav4, Toyota Highlander, plus the all the Toyota Prius models. The Prius has been the Toyota brand’s fuel-economy champion for more than ten years, and the redesigned version has made a significant leap in fuel economy, says Toyota."
Quotes
  • "Toyota will lead the future mobility society, enriching lives around the world with the safest and most responsible ways of moving people. Through our commitment to quality, ceaseless innovation, and respect for the planet, we strive to exceed expectations and be rewarded with a smile."