On June 1, 2021, Amazon announced an expansion of its Frustration Free Packaging (FFP) incentive program to include millions of additional products that the e-commerce giant plans to deliver in packaging for efficient e-commerce distribution.
Thousands of new vendors will have to decide whether or not to develop packaging specifically for e-commerce. Will reducing packaging frustration among consumers lead to more or less frustration among packaging designers? Maybe more in the short term. But in the long run, the overall benefits for brands that sign up can help them outperform the competition by:
• Increase brand value by meeting consumer demands for less packaging.
• Contribution to their own sustainability goals.
• Lower packaging and inbound shipping costs.
• Lower damage rates and returns.
Vincent Barral, Principal, Frustration Free Packaging, Customer Packaging Experience, Amazon, says: “As a founding member of The Climate Pledge, we are getting closer to our commitment to zero net carbon emissions by 2040, 10 years before the Paris Agreement. “. As part of this goal, we are expanding our FFP partnerships with suppliers to include more shipments. We want to increase the proportion of shipments that are easy to open, 100% recyclable and that Amazon can send without additional protective packaging. We are customer obsessed and know that our customers expect us to reduce packaging waste. “
Amazon’s Frustration Free Packaging Incentive Program kicked off in 2018 with durable goods, consumables, and soft goods that are larger than 18 x 14 x 8 inches or 20 pounds or more that are sold and shipped by Amazon. The e-commerce giant defines these larger products as “non-sort” items.
Amazon is now expanding the Frustration Free Package Incentive Program to include smaller “Sort” items, especially the largest sortable products – 6 x 4 x 0.375 inches and larger, but equal to or smaller than 18 x 14 x 8 inches and less than 20 pounds. This includes books, toys, stuffed animals, beauty products, kitchen utensils, and more.
Thousands of vendors and millions of products are now eligible.
“The expanded FFP incentive program will increase the proportion of FFP broadcasts. And it will reduce the proportion of shipments in traditional stationary retail packaging that are oversized to appeal to consumers on store shelves and that are not robust enough to protect products that are shipped directly to the consumer through the small package supply chain. “Says Barral.
Another example would be shipping the product in a box when only flexible packaging may be required. “Our certifications aim to eliminate as much packaging material as possible,” says Barral, while optimizing product protection and reducing damage. “The expansion of our certification authorization beyond corrugated cardboard to bags and mailers made of cardboard will enable more ASINs to be certified than SIOC.”
Expansion begins in North America (June 1, 2021) and will extend to Europe later this year, specifically France, Germany, Italy, Spain and the UK.
This expanded FFP program offers incentives for suppliers who convert products delivered to certified frustration-free packaging in the 15 months between October 2021 and December 2022. Incentives range from $ 0.08 to $ 6.49 per unit depending on whether the packaging meets FFP requirements and reduces the overall volume of the existing package size. A “unit” is called an ASIN, which stands for Amazon Standard Identification Number and is assigned by Amazon to uniquely identify a product within its huge product catalog.
Amazon currently has a chargeback of $ 1.99 per unit for non-certified, non-sortable ASINS for frustration-free packaging – and that chargeback for non-sortable ASINs remains in place. However, Amazon is not currently expanding the chargebacks to sortable ASINs.
In addition, the 2018 FFP Incentive Program offered non-sortable items a one-time early adopters credit for each unit to cover “transition costs”. Amazon does not currently offer early adopter credit for sortable ASINs.
Says Barral, “After FFP certification, providers avoid chargebacks and collect incentives. The expanded FFP program is intended to accelerate the changeover of suppliers to more sustainable packaging that inspires our customers. “
This is how the extended FFP incentive program works.
Providers can earn incentives in any or all of these three ways:
1. By preparing products for shipping without additional Amazon packaging by passing the ISTA 6A test and receiving Ship in Own Container (SIOC) certification from Amazon (FFP Tier 2).
2. By redesigning their existing packaging to reduce the overall size.
3. By ensuring that the packaging is fully recyclable and easy to open (FFP Tier 1).
Under the new incentive program, newly certified frustration-free packaging that maintains or reduces volume is eligible for incentives. Why are vendors rewarded for maintaining volume?
Barral explains, “Rewarding vendors for maintaining current volume encourages them not to add additional packaging over time and to switch to sustainable packaging. The FFP incentive comprises three components: (1) Tier 2 certification “ship in own container”, (2) Cube reduction and (3) Tier 1. ASIN providers who keep their cube are entitled to the first Component if your products do not require additional Amazon packaging (SIOC); and the third component (Tier 1), if they are easy to open and made from 100% recyclable packaging materials. Sellers of ASINs who keep their cube are not entitled to the second component of the incentive (cube reduction). “
The deadline for compliance with this new incentive program expires in October 2021 and until December 2022. It is up to the seller how many months they will enjoy the incentives based on how quickly they can change their packaging.
Photo provided by Amazon
“Since 2015 we have sent over 1.2 billion FFP shipments to our customers. There are already more than two million products in this program, ”says Barral. “Based on the success of the program since 2018, we are significantly expanding the scope of the program to include smaller products to accelerate FFP conversions across our network.”
What did Amazon learn from the 2018 FFP Incentive Program that helped shape this expanded program? “We learned that the resources Amazon made available to sellers through our packaging programs led directly to FFP conversions and accelerated the transformation to more sustainable packaging,” said Barral.
These resources that have been newly updated for this expanded program are:
• Amazon’s Frequently Asked Questions – Supplier Packaging Incentive Document.
• Amazon’s website www.aboutamazon.com/packaging with information and resources in four areas: design, testing, certification and case studies. This will be the vendor’s primary resource, with registration materials, instructional videos for testing, and inspiration samples. The slideshow shows three such successful case studies.
• APASS, the Amazon Packaging Support and Supplier Network, which provides the knowledge and skills required to transition to FFP.
• Test laboratories certified by the International Safe Transit Association (ISTA). Or if companies have their own packaging test laboratories, they can be trained in Amazon test methods and carry out their own tests. The ISTA-6 test simulates the stress a package is exposed to during the e-commerce supply chain.
“In order to certify SIOC and FFP packaging on Amazon, it has to pass a physical performance test. If the product isn’t fragile or liquid, vendors can complete the self-testing case sequence and submit passed test reports, ”says Barral. “If the product is considered fragile (glass, ceramic, porcelain, clay, liquid, semi-liquid), the ISTA-6A test via the Amazon packaging laboratory or a third-party laboratory is required in order to have a package shipped through the Amazon Fulfillment Network Protecting the customer experience. “
• Amazon’s new Incentive Calculator, which enables vendors to calculate the estimated amount of incentive they will receive after their products are FFP certified within the Incentive Payment Schedule.
Objectives of the FFP program.
As part of its frustration-free packaging program, Amazon has worked with vendors and packaging suppliers to optimize ecommerce packaging in three ways:
1. Improve the customer experience.
2. Minimize the environmental impact of packaging, including reducing the amount of packaging.
3. Lower the cost of delivering goods.
These are still the main objectives of the FFP program.
“Right from the start, Frustration-Free Packaging has focused on delighting customers by reducing the size of the packaging and the amount of material, ”says Barral. “Traditional retail requires oversized packaging to make the products on the shelves more attractive to customers. Unlike traditional retail, e-commerce does not require redundant packaging. Frustration-free packaging helps us use the right size packaging and use recyclable materials to further reduce our paper consumption. “
Hence, the FFP program shows how e-commerce offers a unique opportunity for brands to get rid of the packaging waste that Amazon describes as the “containment attractiveness” that is inherent in selling products in a brick and mortar store.
Photo provided by Amazon
Over the years, Amazon has shared many success stories of brands that have made the move to frustration-free packaging. In the slideshow you can see some recent examples from Procter & Gamble’s Tide, Henkel and Lenox.