Coles, Woolworths and crazed consumers: Industry lacks leadership on plastic crisis

It’s World Environment Day 2018, and a packed lecture theatre at Woolworths’ Bella Vista headquarters is listening as group chief Brad Banducci speaks.

Executives from across the industry are in attendance, including Visy’s Anthony Pratt, Harris Farms co-chief Angus Harris and even the ABC’s War on Waste host Craig Reucassel.

What had brought Australia’s richest man, several supermarket bosses and a comedian to the same room? Among other things, plastic.

It’s early-June, and within three weeks, Woolworths will cease stocking single-use plastic bags nationwide. So will Coles, although neither supermarket has a full appreciation for the approaching storm.

Banducci has just finished introducing a bright young student who has already accomplished more in the field of environmental sustainability than most, and as the round of applause concluded, he gets down to business.

“It’s all about collective action,” he declares.

“Essentially we work together, or we can’t achieve what we desperately need to.”

Banducci was speaking in the context of the plastic waste crisis gripping not just Australia, but the entire world.

About 8.1 billion kilograms of plastic waste flows into the world’s oceans every year — less than a fifth of which is recycled. Australia, it’s worth noting, recycled just under 12% of its plastic in 2016-17.

What’s not recycled doesn’t degrade on its own — at least not quickly. This is a feature key to the original popularity of plastic, but a fact which, in hindsight, exposes a human hubris we invariably, and quite literally, ingest.

The Woolworths executive spoke with sincerity against the backdrop of a good PR day for his company, which had just announced, in addition to pulling 3.4 billion plastic bags from annual circulation, it would cease stocking plastic straws by year end.

Supermarket executives sounded sincere when they spoke about the plastic crisis last year.

Coles — because Australian supermarket announcements typically come in twos — had announced a raft of its own initiatives earlier that day, committing to diverting 90% of its waste from landfill by 2022.

A little over 12 months later, World Environment Day 2019 has come and gone, and for all the incremental steps taken so far, Australia, and indeed the world, is still searching for answers.

Within the grocery industry, things are no different. For all the bluster rolled out ahead of the bag ban last year, independent firms are still handing them out by the thousands.

While this is unlikely to last as government laggards catch up, dealing with the broader plastic crisis will be much more difficult.

The average Australian consumes about 130 kilograms of plastic every year, according to WWF figures — up t0 130,000 tonnes of which will wind up in our oceans.

From retail to manufacturing, the vast majority of companies in the grocery and food sectors are SMEs, who will — despite being disparate and stretched for resources — be required to do much of the heavy lifting if Australia is to kick its plastic addiction.

It’s why collective action, as Banducci said, remains so important. But for all that talk, this is an industry where leadership is evidently lacking.

Earlier this week members of environmental and wildlife protection group Sea Shepherd posted a photo to Facebook, alleging they had found plastic toys from Coles’ 2018 Stickeez promotion on a beach in Perth.

“For Coles, this Stikeez promotion might have been aimed at healthy eating for children, but for an animal, there’s nothing healthy about a stomach full of plastic,” the group said in the post, shared more than 600 times in a few days.

For context, scientists have identified more than 700 distinct marine species which interact with debris like plastic, and while it is difficult to quantify the exact extent of the harm plastic causes to wildlife globally, surveyed experts report severe consequences.

It’s not the first time Coles’ plastic toys have allegedly been found on a beach. An Aussie tourist claimed she found a miniature plastic Nutella jar connected to the supermarket’s Little Shop promotion in Bali last November. 

The symbolism was not lost on the tourist, who noted Nutella also contains palm oil, a popular food ingredient which has been linked to deforestation in Indonesia, alongside other factors. 

Asked about the latest find in Perth on Thursday, a Coles spokesperson sought to clarify there’s no claim the Stickeez washed up. Instead, it is plausible, SmartCompany was told, someone merely forgot their toys, or dropped them.

Curiosity over whether Stickeez is a beach toy of choice aside, its hard to understate how misguided this is — as if the manner of disposal is necessarily relevant to its impact, or the possibility the toys haven’t hit water makes them less dangerous to animals.

Put simply, it just misses the point, as does the following quote SmartCompany was provided with: “The Stikeez mini collectables were designed to be kept and customers were able to recycle the wrappers at their nearest store through our in-store REDCycle program.”

Woolworths has a similar recycling program for its promotional toys, which it has detailed before.

Coles, however, went a step further in anticipation of backlash against its recently announced Little Shop 2.0 (Woolworths’ latest version is called Ooshies), preparing internal research which found 94% of its previously distributed toys have been kept or given away by customers.

The original Little Shop promotion is less than two years old, which academic and experienced consumer researcher Louise Grimmer says is far from enough time to reach the type of conclusion Coles has. It also begs the question: how long before they do throw them away?

But even this obfuscates the overriding issue. Even 6% of these toys being disposed of is too many, even the two allegedly found on beaches is two too many.

It comes as academics are calling for urgent changes in consumption habits to curb waste, concluding the world can’t just rely on recycling and must reduce its consumption.

No-one expects the global transition of plastic to happen overnight. But in the face of international efforts to address this issue, Coles and Woolworths continue to expose vulnerable ecosystems to plastic created for the express purpose of bolstering their bottom lines.

Analysts have estimated Coles bagged $200 million in extra revenue as a result of the original Little Shop promotion, but in a country where two players control over 50% of the market, the real kicker is the effect the promotion had on Woolies.

In the wake of the original Little Shop promotion, Coles booked a quarterly 5.1% increase in comparable sales — a closely watched metric. Woolworths managed just 1.8%.

The rest is basic game theory, ensured by established executive remuneration, corporate key performance indicators and the grilling supermarket bosses can expect from analysts and investors after a rough quarter.

Banducci — who don’t forget last year called for collective action to tackle the plastic crisis — promised to avoid a repeat, saying Woolworths has “learnt from its mistakes” and had a plan (Ooshies) to take the fight to Coles.

He may be on to a winner too, such is the craze around Ooshies that one was going for $100,000 online earlier this week. Social media abounds with dedicated ‘buy, sell, swap’ groups for the toys.

Consumers love them, at least enough to make a material difference to national supermarket revenue every quarter — although neither supermarket forces the toys on shoppers.

But consumers loved single-use plastic bags as well, evident in their fury at the ban, and plastic straws are also widely used. Although, Woolworths ditched both.

The promotions are also unpopular. A petition calling on the supermarkets to stop giving out ‘plastic junk’ has 70,000 signatures at the time of writing.

The promotions need not be plastic, or even physical. There’s a reality where the talents of the supermarkets’ digital units could run wild with all manner of loyalty programs.

And while a digital alternative could make the collectibles less popular, less necessary, and many shoppers will probably be upset, it’s not the first time. They’ll get over it — our environment won’t.

While collectibles continue in their current form, executives at both supermarkets will be unable to say their companies value environmental sustainability in its own right, rather than merely through the lens of shareholder value.

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