Food Forum: Earth friendly and profitable

Recycling stations can attract customers, inspire loyalty and boost the bottom line.

By Warren Stoll

Retailers and consumer packaged goods (CPG) manufacturers are always looking for ways to stimulate consumer spending and increase customer loyalty and the current economic downturn has made this an even higher priority for most. While “earth-friendly” initiatives are considered a meaningful way to attract and retain customers, it’s often difficult to draw a direct line between corporate sustainability efforts and increased store traffic. That is, a retailer’s announcement that it is lowering its carbon emissions does not automatically result in consumers switching supermarkets or buying more groceries on subsequent visits.

One sustainability initiative that does have a direct link to consumer spending is recycling. Retailers that provide clean, easy-to-use recycling facilities for consumers on site are not only providing customers with a practical, convenient way to responsibly dispose of their bottles and cans, but are improving their corporate image as well. The automated recycling equipment used at the store can also function as a valuable promotional vehicle to encourage customers to shop for more items or return to the store for future discounts.

Many stores that provide recycling options for consumers use reverse vending machines (RVMs) to automate and simplify the collection, sorting and compacting of beverage containers. RVMs, which look much like conventional vending machines, are usually placed in store corridors, or in the retailer’s parking lot, for consumers to quickly and easily return their glass, plastic and aluminum containers.

In states with deposit laws—such as New York, Maine, Connecticut, Michigan, California and several others—RVMs provide consumers with receipts that they can bring into the store to immediately redeem for cash or apply toward their purchases. In these states, automated RVMs improve the accounting accuracy for the store, while making the return process more user-friendly and clean for shoppers.

Retail stores where consumers buy their beverages to begin with are the most logical, convenient place to recycle empty containers. Research shows that when shoppers have deposit containers to return, they tend to go to the store with the best return solution and many consumers are willing to change where they shop if they find a store with a better container return solution.

Studies show that consumers who return “empties” to grocery stores during their shopping visit purchase up to 52% more than other shoppers.

Stores that use RVMs to provide consumer recycling also have an opportunity to use the machines as merchandising vehicles. RVMs can generate store coupons for cents-off particular retailer or CPG products, promotions for a percentage discount off a future shopping order for the retailer, or other promotions. Unlike the coupons generated at supermarket checkouts, consumers receive RVM coupons before they shop, so they can walk in the store, discount in hand, and potentially spend more on groceries.

Retailers can recoup some or all of the cost of recycling equipment by using the machines to host four-color, billboard style advertising. Retailers can partner with consumer product companies or simply use the signage to promote their store, its sustainability initiatives or other loyalty-generating messages through vehicles such as advertising wraps and built-in video display monitors. As consumers insert their empty containers into the RVM, they can view video messages about promotions in-store.

From a corporate image standpoint the recycling platform can also be leveraged to develop charitable, educational or community-focused initiatives targeted toward providing added value for their customers.

All this is achieved on an interactive basis with consumers via machines with streaming video, where store or consumer product messages can be transmitted to a captive, bottle-returning audience.

Sustainability initiatives are popular with both business and consumers right now; and this popularity is increasing every day. In today’s volatile environment as it relates to economic uncertainty, rising energy prices and concerns about carbon emissions, recycling gives consumers a sense that they are doing something good.

Recycling is a force to be recognized and, if executed correctly, can actually lead to many benefits for the retailer; it’s an opportunity to promote your chain and its products as well as boost your image with consumers in the neighborhoods where you operate. It provides a store-centric way to unite retailers and their consumer product vendors under an earth-friendly umbrella, while at the same time providing clear-cut promotion opportunities to drive sales and profit.

Warren Stoll is vice president of sales and marketing at Shelton, Conn.-based TOMRA, which provides solutions that improve the economics and convenience of beverage container recycling. For more information, visit www.tomra.com.

This entry was posted in 2010 04 Article Archives, Columns. Bookmark the permalink.