How Repurpose built a brand around eco-friendly disposable products

0:04Hello, everyone, and welcome to the Modern Retail Podcast.

0:30for reusable products like, you know, paper towels, cups, plates. It's one of those things. I love to talk with brands that are around everyone and it's a really big company, but are sort of ubiquitous. And maybe people don't even know that they're around them. But Lauren, I think has spent years, you know, this company was founded, I believe in 2010, if I'm not mistaken, but has spent years sort of building it up. It's become the leader in the space. And we're at a really interesting point, just societally as a culture. where people are seeking out better alternatives for things as wasteful, but ubiquitous, like, you know, paper towels or, you know, plates, throwaway plates.

1:10And so I want to talk about all that. I want to talk about how Repurpose has been growing, what the last few years have been like, and then just go into what the overall state of the industry is like. But Lauren, how are you doing? I'm great. I'm super excited to chat with you today. Thanks for having me. absolutely so let's start with you correct me if i'm wrong but before you joined you had a pretty cool company where you were i might be getting this completely wrong but like a green consultant for for hollywood and for tv shows is that correct yeah actually um so my background i know random as could be no i think that's the cool i mean other than being a founder of a huge company i think that that's a really cool job it didn't start out so specialized i actually um i my background is in sustainable architecture and green building so i was actually working in the green building space for a long time and um then had this random opportunity like 15 years ago to come to los angeles i had gone to school in new york and was working in new york um and then came out here to basically take the knowledge and skills of the green building space and then bring it to set design.

2:14So that's how I ended up in on the side of Hollywood sets was really through the green building experience. And how did how did you go from there to founding Repurpose? What's the story behind that? That is a fun one. So we were designing very sustainable sets. And then we would break for lunch and all meals and basically be eating out of plastic salad bowls using plastic forks and drinking out of plastic water bottles. And you could physically see the waste piling up, you know, meal after meal, day after day. And it felt like, well, this is something that needs to be disrupted and changed. And I think because I have a design background and a sustainable design background, I looked at that problem through kind of a design lens.

3:02And I really thought that if we could just design better products and design for circularity, we could help solve this problem or be one of the solutions to the problem. And so first it was more just like a project, you know, like it was a, how do we do this? Okay. What are the, what are the options? And everything we looked at at the time that was sort of like the infancy of this whole category of products, anything that was an alternative to plastic just didn't work as well as plastic. And it was like five times as expensive. So it was like, this is a, this is a non-starter, but if it could work as well, And if the price could come down, then like, why wouldn't everybody switch?

3:38So that was always kind of like the North Star. And I just became obsessed with like, well, why can't it be like that? What, you know, what could we use and how could we kind of achieve that? And over time, you know, the options and the technology just got better and better to the point that we got really close to, number one, the price. And two, the performance was the same as plastic. So that's when it kind of went from a project to this could actually be a company. Like this is a real solution. This is something. And so that was really the start of it. And the idea behind becoming a brand was I'd sort of seen in many other categories in retail.

4:20You'd see these like at the time, this was already like 15 years ago. Better for you brands like, you know, organics was coming up and better for you baby products. And, you know, it just felt like, why couldn't this be its own little category and brand that represented a whole kind of like better for you, disposable products, better for the planet, better for your health. At the time, there was just no option. So it felt like there was an opening and we went for it. Yeah. Was the idea to begin with, because right now your distribution is just like pretty much like maybe you don't think everywhere, but I'm looking at the list and it's like Whole Foods, Costco, Kroger.

4:58Yeah, you're like, if I want it, I'm probably going to be able to get it. But was your idea always that you would be going that wholesale consumer-facing direction? I feel like when you're in a place like yours, often they say, maybe we should just go B2B, and that would be an easier route. Yeah, we had actually, when we first started in the go-to-market strategy was B2B. It was like, well, I can service all these sets, and then we can hit all the campuses. and definitely that was the way to go. But it felt like as we started having those conversations, like we had spent all this time developing the products and making them great.

5:35And they were like, you know what? We actually just want them as cheap as can be. So like, and so we felt like, well, if we're trying to make these products that are great and create a brand around it, like we don't want the cheapest products. So, you know, obviously we want a very price competitive product. We want to give value. But how do we do that in a way that is actually still a product that performs well and consumers are going to want to use again and again? And so we shifted. We sort of did the pivot to, before we really started, to consumer. Yeah. So it was like, it wasn't a real pivot because we hadn't really been in market, but the strategy changed.

6:16And back then, like, was it a difficult pitch to retailers? Oh, yeah. Oh, definitely. Yes. Yes. And yes, in capital letters. Yeah. They were like, you know, I don't think, what do you mean? And I think the problem is that in the past, maybe there had been some version of an eco-friendly, you know, product in this category. Like I said, it just didn't work at all. And it was so expensive. So there was no buy-in on the consumer level. And so any of the buyers that sort of had any experience with it in the past was like, this doesn't work. We've tried it. So don't even bother. Or what is this? Or does this even work?

7:03Like it was so much education around can this even work? What even is this? I'm doing just fine selling tons of foam and plastic. And what are you going to offer me? So we had to create this. We had to create a whole kind of campaign and story, which, I mean, you do with every product, but really about why they should choose us, why our product was different, why it was better, how we could actually sell through. And we had to prove it was sell through. So it was a daunting task, definitely, in the early days. Can you just talk about the process of brand building for this type of product? Because I feel like you're in a really interesting space where, you know, I think a lot of shoppers, a lot of consumers say they want to buy in a certain way, but then they also still buy Dixie cups, you know what I mean?

7:55And so like, it makes a lot of sense to try and have a brand behind it. But that seems like a behemoth task, in my opinion. It has been a behemoth task for sure. I think what you have to do is come in with a price parity option, right? You can't come in there and say, hey, here's a sustainable option, but you're going to have to pay 2x for it or 50 % more or 30 % more. What we found is kind of the threshold is between 20 and 25 % more. So they are willing to pay more, but not much more. And if they are paying more, it's got to work just as well or better. And it has to, you know, deliver on the promise of sustainability.

8:34So non-toxic, compostable, plant-based, all those things have to be verified, certified, third-party tested and proven. And so you have to check all those boxes and then some. And then you have to be available where people are used to shopping. So if those hurdles can be overcome, you have a chance. But still, I think people, you know, people will buy what they're used to buying. And so it's hard to really get people to switch. There's a lot of education that has to be done in such a short time on the package. You know, we're not out there doing TV ads saying, hey, you know, I wish we could. But we have to do it kind of with our distribution footprint and however we can kind of digitally.

9:17and a lot of it is word of mouth too. So it's been a build and that's why it's been, we've been at this for 12 years at this point because there's been so much education and I think the advantage we have now is really just the awareness education around the problems of plastic and the problems with PFAS and chemicals and we have the solution. So we're not having to educate people on the problem, they're aware of it. they just have to know that we're the solution and why they should choose us. So was there an inflection point with the business in terms of, you know, in terms of anything, but like maybe sales channels, like, did you, did you get into Kroger and you were like, this is what we need to do?

10:01Yeah. So a funny story, this is the big, we always point to this, that the inflection point or the real, the moment things change was when there was that awareness of the straw in the turtle's nose. And it was like a giant kind of awareness campaign around plastic is horrible. We were from, from kind of, we went from being kind of in the like knocking down every door business to the incoming call business. And we had all the major retailers calling us about straws because at the time we were one of the first to have compostable straws of it. Not, not the paper ones that everybody hates, but actually, yeah, don't advocate for those, but compostable straws.

10:44And so it was like, whoa. And then that was kind of the Trojan horse that allowed us to show the rest of our line to some of these retailers. Like, we don't just do straws, we do all these other products. And that was the inflection point. And that was in like 2018, 2019. So just before COVID. Yeah, that was just before. Because I feel like, I mean, like, in the last couple of years, A, I've noticed a bunch of more choices. But as you said, it seems like there is a general understanding of what the value add is, or like why someone would buy this more so than ever before, if you're not an educated consumer.

11:20So with you getting calls from all of these retailers, was there also a change in shopper sentiment or how people were responding or what they were asking? Yes, absolutely. So not only was it coming from the top of sort of the corporate boards of these large retailers saying, hey, we need to look at sustainability more closely in this category. But it was coming from a groundswell of consumer awareness saying, hey, I don't want to buy this plastic stuff anymore. What are the options? So they quickly had to find a solution. And, you know, luckily we'd been at it for several years at this point and had the solution.

11:57So it was a great, great moment for us. And then COVID hit, which was a huge challenge for us on the supply chain side. but it really also put a spotlight on the category because people wanted, they wanted, they were at home eating three meals a day at home. They were sick of doing dishes at home three times a day. They just wanted, they really wanted to use disposable products, but they felt guilty using plastic foam or paper. So like we were a nice solution for COVID because we offered a sustainable solution, but you could have convenience at the same time. So that was sort of like the winner, the winner solution.

12:38And that like, we satisfied this need that people, you know, didn't want to do dishes. And at the same time, it was sustainable. They didn't feel guilty. So that definitely increased our sales and increased our kind of, I'd say, the consumer base. And then it's grown from there. And I've noticed like your website now is very shoppable. It seemed like if I wanted to buy a bundle of anything, it seems like I would absolutely be able to. Has that always been the case? Or like, I imagine given your distribution that most of your sales come from wholesale. Is that correct? Yes, most of our sales come from wholesale, but that was also another product of COVID.

13:17We had kind of just, you know, known that we wanted to do or at least have a very shoppable website and have a DTC channel that was robust pre-COVID. but it just accelerated kind of the need to really go there as quickly as possible and offer as much as possible. So I think it's a key component of any omnichannel business. And do you, like for, like how much traction does it get? For like a product like yours, there were people usually go to shop to the grocery store to get this. Like, do you have a fair amount of recurring revenue or people who do buy it? Or what is the purpose of that type of site for your type of business?

13:54We do. And specifically for the more kind of everyday subscription type items. So like trash bags, for example, compostable trash bags. That one is heavily bought online. Toilet paper, paper towel, heavily bought online, heavily subscription based. Those are the big ones just because it's everyday use. People don't want to think about it. And it's easier to subscribe and have it delivered to your door. for other more occasion-based or sort of the plates and cups and things like that. There's a little more seasonality to it, but people are, definitely people are buying online because they can get, you know, the loyalty deals and whatnot.

14:31And so it's a nice option if they're planning ahead or if it's like if you're an event planner or you're a small cater or something like that, it's a great option. Got it, got it. Makes sense. I wanted to shift gears and just talk because you mentioned this a little bit at the top, But sort of the way for repurpose to work was if you were able to figure out, you know, your manufacturing and your product sourcing so that it would be at least somewhat close to parity with the competition. Can you talk about just how that like now that you've reached a certain scale and there are so many more companies out there doing similar things, have your costs gone down?

15:08Like what like on the supply side of things, how has that shifted? Yeah, the costs have come down with volume, definitely, which is extremely helpful. And it's always helpful, for example, as we enter kind of more high volume channels, like that helps to bring costs down for everybody. So that's an advantage for sure. we've had to take a strategy where like in the early days we just went in with a lower margin knowing like hey we're going to make this up as time goes on but we've got to be competitive and we have to kind of promote awareness and trial and we can't do that if we're priced if we're priced out of the competition so that was kind of a strategy that we we took early on it has paid off but it's a gamble because you know if you don't gain the volume or you don't get the traction you're stuck with really bad margins.

15:57So yeah, it's helped a lot. It's definitely helped a lot as we've grown in scale. And how does the manufacturing, where do you do manufacturing? How does it all work? Have you had to expand who you work with just because of the demand? Yes, we have had to expand who we work with. Some of our products are done here in the U.S. and we're always trying to bring more to the U.S. It's just much easier and better to do it here. But we've got some great partners, which we've had, you know, over the course of 10 years in Taiwan, actually. So they're kind of our primary partners. And they've been ahead of the curve more so than the U.S.

16:37because Taiwan actually, they outlawed single-use plastics in 2006. So they were very much ahead in the space and had incredible manufacturing, incredible technology that we brought here to the US. So it's been a great partnership. How have you viewed the product portfolio? Or how have you strategized the product portfolio? Because like, from, you know, me looking at everything you have, it's, you know, you pretty much have every type, you have plates, you have cups, you have straws, like, is that is your product portfolio finished? Now? Is this everything you're going to do? Or how do you decide when you're going to add a product and how it fits into things?

17:14Like, how does that all work? We're never done. We sort of look at it in a few different ways. One is sort of, does it fit into this realm of household? And is it a better for you, better for the planet option? So it's got to fit into that world and that realm. From a retail category standpoint, we kind of operate currently in three different categories, but oftentimes it's similar buyers or adjacent buyers. So we're kind of talking to them about broadly the category. But we started out in disposable tabletop is what it's called, DTT. And that includes like plates and cups and cutlery, straws, etc.

17:58And we did really well there, became a leader there. then we were like you know what we want to get into trash bags it's everyday use this is something people want and they really associate compostable with trash bags and it's really useful because what we're trying to do is get food out of landfill and food into you know food into composting uh piles so how do we do that we do that with bags so bags was a next logical step and then we became the leader in bags and then it became clear too through we just want to test through or website. Well, how would it look like if we did toilet paper from bamboo?

18:32Because this is another thing. It's in the house. People want something like this. Our customer is looking for this. Could we offer that? And that did really well online. So now we're in retail as well. So now the goal is always to kind of have all the products that you sell well, all the products that do sell well in all the different channels to be consistent. And so we have all those areas. and what are we going into now? I can tease it down the road, but it's extensions of these categories. Okay. Yeah. Well, I'm excited to learn more when those come out. Yeah. Eco household. Eco household.

19:10I love it. I want to live in that. We're going to take a quick break and we'll be right back. On the wholesale side, has the product demand shifted in terms of what those stores are asking for or what their customers are asking for? Because I imagine probably when you first launched, it was plates and cups, napkins, like that type of stuff. But has that changed a lot? Are you seeing a greater demand of newer products or what people are asking for on those shelves? They're definitely asking for what's new, what's different. Do you have anything that is not just sort of standard? They like more design, more design-centric products, whether it's the form factor or the actual print.

19:59How can you get more interesting than just the ubiquitous plate? What can you do outside of the basics? And so that's an area that we're looking into. Or how can you replace very ubiquitous products that are very much used day in, day out on the conventional side? Can you do that in an eco-friendly version? I think for us, because our brand is very much centered around like we want performance to be as good or better than the conventional product. We want to be at a price point that's affordable and it has to be as sustainable as possible. Those three things have to coexist and then we will bring a product to market.

20:41And I think the challenge is sometimes you can have an incredibly sustainable product. Like it might be made from something that is just the most sustainable feedstock in the world, but the price is too high or doesn't work as well. And so it's never going to make it to market. Or you might have something that the price is great, but the sustainability factor is not as much there. Or, you know, the performance is not much there. So for us, the challenge is always how do you tick all those three boxes before we present anything? Because that's what our brand stands for. whereas you'll have competitors that are like we care about how cheap this is it's okay if the quality is not so there or whatever it may be but um i think for us like we looked at for example doing a line extension on um like zipper bags compostable zipper bags but which a lot of people want a lot of people use they really want something that can replace those plastics of you know zipper bags um but the quality honestly on the compostable side is not totally there um they're great for carrying things but the material is more porous so it doesn't keep things as fresh as plastic would so if you have crackers in there they get stale it's like i don't want i don't want to put something out with our stamp of approval on it that doesn't really work that well and is also very expensive so like you're paying definitely paying more you're paying a premium for these products, but they don't deliver a premium experience.

22:10So, you know, it's a tough one. That's sort of how we look at all of our line extensions and what we're going to do next. That actually leads me to a question that just popped into my head, but on the supplier side, are you just getting, not bombarded, but I feel like given how hot sustainability and And circularity is, I imagine there's just a huge amount of people who are creating new types of processes for developing products that may or may not work, probably are more expensive, but they want a company like yours to use them, right? Are you hearing more about people who are trying to use these types of materials?

22:51Absolutely, which is actually really exciting because we can work with these. Oftentimes, it's just like some scientists, honestly, that have come up with something amazing, but they don't have a sales infrastructure or they don't understand CPG and retail. So we're able to partner with them and bring something to market. We can commercialize what they're doing overnight, which is really, to me, exciting for us, exciting for them. It's a great partnership because we're bringing this new technology to market that otherwise would take years and years. So, yes, it is happening. There's a lot of, you know, trash, no pun intended, trash out there.

23:32But there's some great, very interesting new technology, one of which we're partnering with, which we can announce soon. Not quite yet, but I'm really excited about that. Yeah. All right. Can't wait to hear it. Can you talk just about the actual physical branding side of things? Because I imagine it's different now than it was, you know, 10 years ago, where you need to tell more of a story. But do you still need to tell a story and you're next to Dixie, you're, you know, in a shelf where people are spending half a second looking at it? So how have you approached that? I think what's interesting now versus what was back then is, again, you've got five seconds.

24:15How do you do it? The difference is we've tried to just be a little clearer and just more succinct and to the point. we've tried to showcase as much of the product as possible where it's not hidden by you know the packaging the packaging is all uh either recyclable or compostable so we're moving away from any plastic in our packaging so that it's very clear oh this is this is this is differentiated from a dixie plate and they can see that right away um our brand is a lot more prominent um We've tried to take what we see as best in class from other categories, where we've seen other challenger brands do really well and apply that to our product.

25:00And I think it's working. You mentioned earlier that on the advertising front, you haven't done TV campaigns. But can you just talk about what marketing have you done? Has it all been on the retail media side, just getting end caps, that type of stuff, and a few digital things? And given that, I mean, you're a category leader. Should we ever expect to see you do a TV campaign? Or do you just think that that's not in the cards? No, I hope we can, honestly. I mean, you can do it much more cheaply now, right, with connected TV. So that's like definitely on the horizon, hopefully. We've never done TV.

25:34We do a lot of digital ads. So we do a lot of like meta, Instagram, Facebook. Just, you know, either we're using kind of like an anthem story about the brand or we're doing kind of more user-generated content or someone has used our product and explaining the benefits. And we've done all the kind of like search, that kind of thing. But no, we have not done a broad campaign that's, you know, billboard or TV or even, you know, podcast ads, none of that. So I think that's something actually that when we have, when we were raising money, investors liked that. They were like, I like that you've become the category leader and you haven't marketed your way there.

26:17You've done it because people are actually choosing this without you having to pay to acquire these customers. That's interesting. I mean, that makes sense that investors would like that. But them specifically naming that, I guess the distribution was more of your marketing and just that people were buying it, right? Yeah, but I think brand is really important in this category, especially because it is kind of commoditized. And we don't have elements to work with like flavor or scent or color, really. There's not a lot to work with to differentiate, right? So it has to be, why are people choosing you over someone else that's offering something compostable or something plant-based or non-toxic?

27:08And it's really because they believe in what we represent as a brand. And what does that come with? Well, the quality, the sustainability assurances, the authenticity. That's what we can offer. Whereas you have very, very large plastic companies making an eco version of whatever they do. And I think people don't necessarily buy into that. Yeah, it makes sense. You've tipped to a few things that you can't announce yet, but I guess my strategic question to avoid that is, what are the major things that you want to accomplish? Is it product expansion? Is it getting into more retail doors? What are you thinking about in terms of goals for the next 12 months?

27:52Definitely both of those things. so we are expanding product and we hope to get and those are going to be hitting shelves so you'll see those you know in the next six months which is super exciting and then we hope that those products go to all the other doors that we're in and would love to expand our doors so um you know there's always a bigger footprint to to achieve i think we just want to be really the ubiquitous brand that's associated with this category and continues to be. So, and we're, we're entering a little bit in the adjacent category. So you'll see us there as well, but just kind of your, your trusted source for all things eco household.