Nestle's NESN.S Nespresso coffee business is launching paper-based compostable capsules to attract customers put off by the Swiss packaged food giant's metal ones, which despite being recyclable often end up in landfill. Nespresso CEO Guillaume Le Cunff told Reuters that not all customers were aware that its aluminum capsules are recyclable, and may be more comfortable with the compressed paper pulp pods.
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"The objective is not to replace all the aluminum pods with paper, but to give the consumer more choice. It's an alternative for sustainable options," Le Cunff said in an interview. "You can compost the paper capsules or recycle the aluminum ones. We let the customer choose," he added.
Nespresso is one of Nestle's biggest brands, with 2021 sales of 6.4 billion Swiss francs ($6.7 billion), and also one of its most profitable. After surging sales during the COVID-19 pandemic, Nespresso has seen growth slowing, although Le Cunff said the launch was not a response to what he called a "readjustment."
Le Cunff did not give any sales targets for the new capsules, which took three years to develop and will be trialed in Switzerland and France, but hoped they would attract new consumers and keep existing ones.
Nor was the launch "greenwashing", Le Cunff said as Nespresso had long been committed to recycling. Instead the new capsules were part of the brand's evolution and innovation. "People who have never considered Nespresso before will buy this capsule, and we may re onboard people who have left."
The brand had also been resilient during previous economic crises, so Le Cunff was confident about its future. "Nespresso is an affordable luxury you might want to protect as a consumer during a tough time," he added.
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