“It’s not that it’s made from plants, recycled materials, or whether you’re using less materials. It’s really about if those activities deliver better environmental performance.”
Tell me a little about your PlantBottle™rollout.
Right now we’re executing plant bottle packaging around the world in building the supply chain. I’m travelling all over the place, seeing it being executed in different markets.
Where are some the markets you’ve been to and where are you planning on rolling it out next?
I just came back from India over the weekend. Some of the initial impetus for the innovation came out of India. But in terms of where PlantBottle™ is in the marketplace, I’m going down to Argentina to do an official launch. I also spend a lot of time in Brazil and I can talk about how it is important in terms of sourcing. Also, Mexico, Japan, Northern Europe (we’re really spreading across Europe in a hurry), and obviously the US/Canada and all over South Africa.
Are you trying to do all of this in the next year?
When you look at speed of the market in terms of the power of innovation, our target is by 2020 to have 100 percent of our PET packaging with up to 30 percent plant based material. This is the first step of the innovation. The scale and volume of material we use around the world, that’s really saying something in not a lot of time. That’s why I’m flying around the world!
Can you tell me a little about your background and how you got involved with PlantBottle™?
I’ve been working at the company for nearly 14 years now. I had been doing consulting for EPA in DC on green and lean supply chain work, business outreach programs that help business create strategies for saving money at the same time as improving environmental performance. So I was excited when Coke reached out and offered me a position. It allowed me to focus on an individual company. That was really an ambition for me. Working with a large multi-national is really where the action is. A good part of these last 14 years have evolved into leading our global sustainable packaging strategy. Looking at where waste is showing up across the entire value stream for packaging and developing strategies to drive that waste out and improving environmental performance. Also improving economic performance of our materials. This ranges from everything—how we design packages all the way down to setting up recycling systems and technologies for using the materials.
This ultimately led me to this work over the last 10 years of how to de-couple plastics from petro chemicals, from fossil based material. I had looked at this as the next step of the journey we had already been building upon, designing for recyclability, increasing recycling, and then wanting to do this next step. It hit at the right time when the company was embracing transformational big initiatives and saw the value of putting a person in place as a manager of such an initiative.
Gene Farrell is another great example of where the company is identifying major transformational initiatives and putting in the leadership to lead cross-functional teams. You’ll hear me reference again and again of the power of having a group of people that aren’t functionally based but are cross functional: we’ve got procurement, marketing, public affairs, supply chain, and R&D all working on a single team. I have the fortune of serving as the dating service in orchestrating our holistic strategy for moving this project forward today. That’s where I’m at as the general manager of our plant bottle platform.
The question I hope to solve is as manager of this initiative is how do we replace a 100 percent of our plastic packaging from fossil-based materials to renewable materials while remaining recyclable while continued to meet the needs and desires of consumers?
How are you deciding which products to switch to this new design?
One of the key advantages of the innovation that we came up with is that it is the only one that can meet the performance requirements of our beverages while still being fully recyclable and made with plants. In the past we saw a lot of innovations in the plant-based packaging space had to make decision where it would work for one product and not another. This is able to work across our entire product portfolio, allowing us to have flexibility at the local market. Today we’ve allowed markets to decide what is most relevant to them keeping in mind that we have a target of being at 100 percent by 2020. We are ultimately rolling it across everything. As we are in the initial phases of rolling this out, there is a price premium associated with it. There is a productivity component that we believe long term will drive us to price parity—or perhaps even better—when you start looking at what petro commodities are doing in the market.
But we’re also looking at what makes sense in the local market, with the consumers we are trying to reach out to. It was especially important that we did have it in brand Coke as a signal to the marketplace around our commitment. We knew that having it on that key brand would send a signal. Obviously that is not a brand we take lightly. We were focused on highlighting the fact that we’re committed to where we’re going with this. We wanted to ensure that the market saw this dedication.
You see in Asia that we’ve used it in teas and waters. In the U.S. the big push has been with Dasani. Obviously that is because of the size of the brand and the fact that we could move quickly to a national rollout.
We are also actively involved in building the supply chain out. We want to be able to make this a reality around the world. It’s one thing just to say you want to have it or to come up with a technology. The question is how you make it commercially viable. We are actively working with partners to build additional capacity so we can meet our needs toward the targets we’ve set from our business. You will see continued communications as we build additional plants (and by plants I meant facilities) to be able to make this material. Obviously when you look at a brand in the U.S. that is the size of Coke, you can see that we would be challenged by supply while meeting the needs of people around the world. We want to have a system set up that allows us to start using the material in multiple markets. There is a balance around the existing capacity and availability of materials together with the right connections with brands early on to explore the market potential for this innovation as well.
There is probably a great deal of cost in developing the PlantBottle™. I’m curious to see how you balance the short terms costs and projected profit.
The program started as an initiative on how to advance our environmental performance. Going back to my previous role on packaging and sustainability, Coke has always looked for ways to improve environmental performance and packaging. A proof point of this is that Coke was the first in the food and beverage industry to do a life-cycle assessment of packaging. Coke did that back in the late 1960s. There are a lot of people who are talking about LCA’s and measuring environmental performance over the life of packages. This is something we’ve been driving for some time. So that’s how this project was initially started—looking at how to reduce the carbon footprint of the package and de-coupling the material from a non-renewable resource.
I often say that waste is a signal of inefficiency and inefficiency is a signal of cost. The price of oil or natural gas does not seem to being going down these days and seems to become more volatile as we move to the future. The project also focuses on how to continue to drive cost-competitiveness to our business and how to we offer competitive price points for our consumers at a time when we see commodities becoming increasingly volatile.
So while there is a cost upfront, the largest part of that cost is having a supply chain that isn’t filled out. It is less about the cost of the technology or material and more about the material being made in all the places that you want it. That is the big part of the path that is bringing the cost down. It is an investment toward the future that we think is bright, both in sustainability and improving the environmental performance. The bottom line is that Coke has been around 125 years, and we plan to be around for another 125 years. Driving sustainable growth for our business looks at thriving our business from both shareholder value and societal value. We are placing big bets and are investing in our future to realize the fruits of longer term.
Do you plan on licensing this innovation to other brands?
As we’ve gotten into this program, and the world is realizing the importance of this innovation, we are seeing a shift in the commodity plastics business. Now a greater percentage of key stakeholders see a pathway for converting from commodity plastics to plant-based sources. There is a lot of work that needs to be done, but the inspiration has been catalyzed by Coke’s initiatives. As part of the recognition, we’ve received a number of awards including the DuPont Packaging Award and the Edison award. That acknowledgement of leadership in the space made us realize this not an innovation we can keep to ourselves. We predict that the entire PET industry will move. The question becomes, how do we enable others to move into this space? As we grow the supply chain, we must bring other companies into the plant packaging material space. The biggest signal of that was the initial partnership with Heinz.
There are a number of key drivers around the initiative. One is in terms of signaling to the marketplace and suppliers that this is an opportunity bigger than Coke. We need to learn how engage the supply chain in investing in this space. The other key advantage is that there are a number of green products and eco-messaging in the marketplace today. It is a bit cluttered and there are a lot of questions about what is truly delivering and improving environmental performance. We recognize that the PlantBottle™ packaging journey takes a little bit of time for a lot of people to get their mind around (i.e. what exactly the innovation is and understanding the transformational nature of it). We want to engage the consumer and bring them into this journey so they can see what it's about and learn more online. Having a visible brand like Heinz that is sitting on countertops or retail counters helps consumers recognize the innovation and get more excited about it.
We are absolutely interested in enabling others to join this journey. Ultimately, we want to open it up broadly across the industry.
On a local level, are you seeing a lot of positive feedback? How are you planning on launching this in other markets?
Feedback has been overwhelmingly positive from consumers. We are working very hard at it, because although Europe has highly environmental ethics, they also have a high degree of cynicism. That exists within the space and people wonder if this is greenwashing or a corporate ploy. It’s tough for someone to understand our initiative when it is written on the side of a package or a communicated in a 30-second advertisement. Early on, we worked with key stakeholders including academics. A lot of our environmental research was done with Imperial College London, Michigan State, the World Wildlife Fund, and sitting down with government entities. Recyclers were another key component because unlike other plant-based plastics this remained recyclable. It is still somewhat of a challenge, because being able to make the same plastic as we did before—but now from plants—is very important to people.
Additionally, it is difficult to get people to understand and break away from the very romantic connection of having something that’s natural go back to nature. Most people assume that if it’s made out of plants, it should be biodegradable. Explaining the bottle to our audience is about trying to make them understand why the real opportunity is ensuring you’re delivering real environmental performance improvement. It’s not that it’s made from plants, recycled materials, or whether you’re using less materials. It’s really about if those activities deliver better environmental performance. In the case of beverage containers, it’s much better to be recycling those molecules than putting them back in the dirt.
Consumers have embraced this and have been great, but we need to keep working to help them understand what this innovation really is. We need to build trust with them, since there have been so many products that haven’t delivered on that trust. It has created some degree of cynicism. We’re working very hard at communicating and finding new ways to communicate to consumers and partners.
How does the recycling process work?
When we were looking at how to come up with a renewable plastic, there were other plastics that were made from plants. The challenge that they ran into is that one literally couldn’t hold water. Also, they were new plastics so there wasn’t a market for recycling them. What we struggled with is that just because it’s made from plants, doesn’t mean it’s inherently better for the environment. You might de-couple it from a non-renewable material, but then you’re generating waste that’s not recyclable. Questions that arise are where do the materials come from? What are the plants you’re using? Is it competing with food? There are a whole host of issues when considering if it really contributes to better environmental performance.
Coke stepped back and saw that everyone was looking at the out of the box solution. We joke about looking inside the bottle. What we did is instead of saying, “what is wrong with the current PET plastic packaging,” we asked, “what is right?” There is a lot of good with that package today. Consumers have embraced it because it is lightweight, shatter resistant, resalable, and fairly cost-effective. For 30-40 years now an infrastructure has been in place with an efficiency that has made it pretty environmentally sound; it doesn’t take a lot of material to make it, it’s recyclable in society. Indeed, in the U.S. we can do an even better job of recycling. From an R&D perspective, we discovered that one of the two major ingredients that makes PET could be replaced with a plant-based material. We are able to make a bottle that is chemically exactly the same but that is derived from plants instead of fossil pants. So instead of old carbon, we are able to use new carbon to make the exact same bottle. The only way to tell the difference is to do a carbon 14 test.
That is such a big breakthrough because now there is no need to change the recycling infrastructure; you don’t need to separate it out from other plastics. It’s the same quality and provides the same performance as the product you’re using today, all made with the same equipment. It is huge from an environmental and economic perspective. That is what is often the hurdle for environmental innovation when you’re trying to come up with a commoditized product. We brought in an innovation that is revolutionary, but evolutionary. As a result, that is why you’re being able to see us move so fast. What changes is the manufacturing of that ingredient and the source of where it comes from. That is where the work is—but everything else stays the same. Today we are making plant bottle PET resin in the major markets where we’re using it.
It is no different. You put it your bin because it is PET. Then we put it back into our bottles or we are “greening” other people’s supply chains—for example, when you buy your Patagonia jacket or your carpet. Overall, we’re actually lowering the carbon footprint for those products.
So, the world really is getting greener because of Coke.
ABOUT Scott Vitters
Scott Vitters has worked to advance The Coca-Cola Company’s commitment to environmental excellence for the past 10 years. He currently is responsible for governing the company’s PlantBottle™ packaging. Prior to joining Coca-Cola, Scott served as a consultant to EPA’s Office of Solid Waste. He also served as a research fellow with the Environmental and Energy Study Conference, a congressional legislative caucus.
Scott is on the Board of the National Recycling Coalition and serves as the Chair of the Beverage Packaging Environment Council. He is also on the Board of the Piedmont Park Conservancy in his hometown of Atlanta, GA.