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Replogle Asks If Goals Match Actions

John Replogle, president and chief executive officer of Burt's Bees, presented the "severe dilemma" the beauty industry is facing today by asking the audience of beauty executives one simple question: "If we're here to help consumers live better...

John Replogle, president and chief executive officer of Burt’s Bees, presented the “severe dilemma” the beauty industry is facing today by asking the audience of beauty executives one simple question: “If we’re here to help consumers live better lives, then do our actions, our policies and our leadership support that stated mission?”

Replogle was speaking of four specific areas in which beauty companies, aside from making beautiful products, can target making life better for people, specifically through sustainability, formulations, marketing and standards.

As the head of Burt’s Bees, Replogle knows that his company’s mission to “make people’s lives better every day naturally” is a journey — one that he realizes still has a long way to go. But he wanted to put out a question to the beauty industry leaders in the room as to whether their respective companies are on a similar journey, or, at the very least, are they on a path?

He cited several audience members as those to whom he looks up, including William McDonough, a co-author of “Cradle to Cradle: Remaking the Way We Make Things,” as well as CVS for its recent action to protect the well-being of its consumers by voluntarily reformulating its in-house personal care brands, a move Replogle called “bold and courageous.”

But yes, the industry has a way to go. In regard to sustainability, Replogle said beauty companies continue to create tons of packaging waste.

“You just have to go to the store and look at how we’ve packaged our offerings to consumers and realize the amount of excess we create in our designs. We don’t start with the design end in mind. We are creating packaging and why is that?”

On formulations, Replogle asked the audience what it is doing with products and formulations that continue to use ingredients with suspected human health risks.

Regarding marketing, Replogle asked whether the industry misleads consumers or deliberately green-washes certain terms.

This story first appeared in the May 30, 2008 issue of WWD.  Subscribe Today.

“Now we would never say that consciously and out loud, but it is a practice that we all see, we recognize. If we scrutinize our competitors’ advertising positioning and claims, we see it. Do we see it in our own?”

On standards, Replogle wanted to know what the industry as a whole was doing to navigate and help consumers make honest product choices to help them live better lives.

He warned that the industry’s actions and behaviors would not endure in the white-hot light of the changing consumer market and digital media age.

“Let’s face it: We may own the brands, but they live in the public domain….Our brand is simply an accumulation of two things — our relationship with our consumers and the sum total of our actions and behaviors. So our brands are going to be measured along a new dimension, which is the collective actions and behaviors of our organizations. And we see that more and more turning up in the consumer dialogue.”

Replogle pointed to Dr. Bronner’s, a leading organic brand that recently took 12 companies to court in the state of California for using certain ingredients in their formulas even though they position themselves as natural. Another example is the public beating the Dove brand recently endured by a campaign from Greenpeace, where it created a commercial discussing how Dove’s parent, Unilever, is destroying tons of trees for the use of palm oil.

“They have taken the exact Dove Real Beauty advertising and they’ve made it into their own 60-second spot, complete with the Dove logo, which has blades at the end of the ‘e’ cutting down a sustainable tree. Fifty years of brand equity up in smoke. It’s going to take a lot of 30-second spots to erase the damage of that ad that will live forever in YouTube. [About] 380,000 people have actively clicked on to watch it, and since that ran, Unilever has come out to say that they will, with no connection back to Greenpeace’s action, change their sourcing to be sustainable in palm oil,” said Replogle.

The good news — and apparently the bad news — is that brands can change overnight. And in personal care, the trend is toward wellness, complete with a new consumer called the Lifestyle of Health and Sustainability consumer.

“These consumers today are about 19 percent of our consumer base here in the U.S., and a secondary group, the Naturalites, who are driven by personal wellness, represent another 19 percent.”

The LOHAS consumer, explained Replogle, is an active steward of the environment. She is dedicated to personal and planetary health and she is the heaviest purchaser of green and socially responsible brands. The Naturalite, he went on, follows closely in her wake and considers her personal health to be her primary motivation.

Companies, in turn, are creating LOHAS-related consumables — brands that are sustainable, that deliver on their well-being and the well-being of the planet.

“[These consumers] are different than our traditional consumer. No, they are not buying on price. They are not shopping by brand and — sorry to the fragrance houses — they are not buying on scent. They are buying on a whole new dimension. Their purchase behavior is driven by two factors — for the evangelist or LOHAS consumer, it is seeking natural ingredients. And for the new Naturalite, it is about avoiding chemicals. They are shopping not by the front, but by the back of the label. They are being driven by a whole new purchase decision and they are willing to spend more to have sustainability-sourced products.”

Replogle shared some statistics: 26 percent of LOHAS and Naturalite consumers are aware of the risks that are commonly found in personal care ingredients, such as parabens and theolites; 97 percent of consumers believe that personal care should be regulated; 71 percent of consumers wish more natural personal care products were available in stores; 65 percent of consumers say they will pay more for products that are manufactured and supplied in a sustainable fashion.

Burt’s Bees recently helped create a set of principles to guide the beauty industry, called the Greater Good Business Model. The model is supported by three fundamental principles: natural product formulations, environmental sustainability efforts and social responsibility.

The product principal has actually taken off in the form of a Natural Standard, one that looks to place a seal on products that the standard deems natural.

“We strive to formulate with 100 percent natural ingredients. About half of our products today are natural, about half aren’t. So we’ve got a gap to close. And, in fact, we put very transparently on every single product we sell, down to the second decimal, what percent natural our product is.”

In regard to environmental sustainability, Burt’s Bees has accomplished many things and also has set up for itself some lofty goals. By 2020, the company aims to be carbon-free, have zero waste to landfill and to have 100 percent renewable energy off the grid. Last year Burt’s grew 30 percent as a business, but cut its energy use by 2 percent and its carbon load per product made by about a third. In two years, the company cut its waste by 50 percent.

Building a relationship with the community is the company’s third pillar. North Carolina, where the company is based, is the ninth richest state in the U.S., and Durham is the poorest county with more than 20 percent of the people living in poverty. So, Burt’s Bees and its employees built the first green, low-income housing in the state.

“And while we have done good for the community, we have done even better for ourselves because the bond it gives our employees…is driven right back into our business and pays huge dividends.”

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