How do you get a product into retail that goes directly against mainstream capitalism logic?
Most of you have probably heard the term "planned obsolescence". Planned obsolescence refers to products that are purposely manufactured in a way that makes them break after a certain period of time.
Years ago, the light bulb was, for example, lasting 30 years. What about today? Most of them today last at most two years. You might wonder, why would companies want to plan artificial and early obsolescence into their products? Obviously, because it makes more profit to sell a product more than less often. Broken products generate more profit for companies. Firms can make more sales and more money with fast-moving consumer goods than with a product that is long-lasting and therefore, truly sustainable.
This little truth not only applies to producers, but to all steps in the value add chain; from production and sub-sub suppliers, to wholesalers and retailers. Retailers are interested in selling goods with a high sales cycle versus slow selling products because they want to sell more often and make more money.
But imagine a world, in which all products would last long. Would retailers be able to survive? Would producers be able to make money? Surely, it would be beneficial for the environment. But what about the economy as a whole? Some authors in fact demand even more planned obsolescence because it would increase the economy's turnover and GDP, while also yielding more VAT and tax money to be invested in infrastructure, education and other public services.
However, in a world where the international community, politicians, scholars, demand sustainable development and the average person wants to live in a environmentally healthy and sustainable world, we need to rethink the fast-moving consumer goods model.
The question is, how do we get companies to produce long lasting and sustainable products in our capitalist system? How can companies help to achieve the sustainable development of markets? And furthermore, how can we break the cycle so that retailers will actually stock these products?
The example of Ruby Cup illustrates that the vision of companies taking the lead to achieve sustainable development is no walk in the park. But it can be done. Here’s how we did it.
Example Ruby Cup
Ruby Cup is a long-lasting alternative to tampons and pads. It is made of medical silicone and can be re-used for up to 10 years. It is important to note that Ruby Cup is not only healthier and safer to use, but for the customer, it is also more economical (over ten years, women would save 1000 EUR) and better for the environment (on average, women would save 12000 tampons per life-time) than its fast-moving friends, Tampon and Pad. Yet, these two advantages for customers are the biggest disadvantage for many retailers.
Under economic aspects, tampons and pads make customers return to the store at least every month leading to frequent sales. The more often the customer returns to the store, the more likely it is she will buy other goods. When buying tampons, women would typically also spend money on chocolate, chewing gum etc. which leads to increased revenue for the retailer. Selling Ruby Cup would cannibalize these sales.
For Ruby Cup, on the other hand, it is important to be visible and placed on the supermarket shelves, not hidden in the warehouse. Because how else would you create awareness about new and relatively unknown product?
Disrupting the fast-moving consumer space
Here are our tips for getting your products on the shelves:
- Find your target audience - Ruby Cup realized that it would need to re-think what kind of stores to target and developed a strategy that targets specifically high-end retailers, such as pharmacies, sex-shops, and high quality organic stores. Instead of going mainstream and try to target the largest retailers, such as Rossmann and DM, it positions itself as an aspirational, high quality product. Eventually, when demand increases, the larger chains would want to "be part of the game" and sell the product. Ruby Cup thus goes from a push to pull position.
- Rethink your sales strategy - The company now puts a lot of effort into the integration of the marketing and sales aspects of the product (offering trainings and workshops for shop personnel) and does in-house promotions. The retailers, on the other hand, are happy to be able to offer their customers an all-in-one solution: An innovative high-quality product combined with extensive marketing and awareness building.
- Find the right partners - In the future, Ruby Cup will work with complementary distributors that can assist in the education and marketing process, such as pharmaceutical companies, for which Ruby Cup constitutes a perfect match and healthy add-on to their already existing products.
- Go in the field - No one can figure out the right sales strategy from their desks. You have to go to the stores and find out what questions customers ask in order to train the personnel to answer them. Only when you know the considerations your customers have before making the sale, are you able to meet their needs. Being in the store, doing promotions and learning from your customers is thus a big bonus. (Conducting market research is key!)
- Use your personal connections - being recommended by someone who knows someone in a particular retail chain does not hurt either. It can be of immense help when calling the procurement department to know the name of the manager. Personal connections are also important when finding the right partners in order to be able to piggy back on another product's distribution and marketing efforts. Yet, no one should rely on personal connections only, the product has to convince.
- Promote your social mission - Ruby Cup has a social mission. For each Ruby Cup sold, one is given to a girl in Kenya that cannot afford female hygiene products. Having a social mission can be beneficial as it may put positive light on the retailers and co-brand the chain as a responsible brand. Given the quality is high, when the retailer has to choose between various brands to place on the shelves, having a social mission might be your competitive advantage.
What can you do as a consumer?
Consumers can be part of supporting sustainable brands and companies by making educated choices. We live in a throwaway and overly consume-oriented world, in which consumers often choose to invest little money in products that break fast instead of investing a bit more in something that would last long. If we want the planet to be healthy, consumers also need to make healthy choices and buy products that last.
About the Author
Maxie is co-founder of Ruby Cup. She has always enjoyed working in the areas of international development, CSR and humanitarian assistance. Maxie has 6 years of international work experience in public, private and non-governmental organizations. She has acted as researcher drafting studies for the UN General Assembly, worked as corporate analyst, consulted on micro-finance topics in Nicaragua and organized high-level roundtable discussions at the EU Parliament.
Maxie holds a Master degree in International Business and Politics and a Bachelor degree in Business, Languages, and Culture from the Copenhagen Business School. Between, she studied at the Universidad Autónoma (Madrid) and University of California (Berkeley). She sits on the board of Young Women Social Entrepreneurs in Nairobi (YWSE), was selected Attaché at COP15 in Copenhagen, Youth leader at the YENI seminar in Germany, and guest speaker on minority issues in the Danish Parliament.
Get in touch with Maxie here!
Originally published February 18, 2016