What retailers can learn from Lush’s packaging-free stores

August 28, 2019
4 min read

In early 2019, Lush opened its first packaging-free ‘Naked’ store in the UK, a radical new format from the brand and one that ties into a number of emerging trends – from sustainability to waterless beauty. Mintel visited the store in Manchester in August to see what the rest of the sector could learn from Lush’s bold approach.

Inside Lush Naked

From the outside and upon initial glances inside, particularly considering its small size, the Naked store looks no different from a regular Lush store. However, what awaits shoppers inside is a vast range of colourful products merchandised on various types of creative displays, with not one bit of packaging in sight. While there is only one of these concept stores in the UK as yet, there are two more in Milan and Berlin, and a fourth ‘Naked’ store is due to open in Hong Kong.

An advantage of the concept is that the products are cheaper as a result of no packaging and reformulation in some cases, for which the production process is more cost effective. The store takes part in the nationwide plastic pot recycling scheme, highlighting its importance to the company’s values and its view on inclusivity. According to Mintel’s 2018 report on ethical lifestyles, 43% of shoppers are interested in using packaging-free stores, and even more are interested in using plastic-free stores. The data shows that from a consumer perspective, there is certainly demand for a store like this one.

Test store for new ideas and products

The Manchester store is also a test store. A lot of the unique products sold are new additions to existing ranges, giving shoppers more product choices in their favourite categories, smaller versions of existing products (such as body and hand soaps), or reformulations of existing products (such as shower gels), re-engineered to eliminate water content and add natural solidifying ingredients.

A priority for Lush is that its overall product range is about need, rather than want. This ensures that the retailer has a tight yet credible range to suit its entire shopper base, without having too many unnecessary products and choices. Waste, quite evidently, is high on the retailer’s agenda, with unused stock donated to various charities.

Unparalleled in-store experience

As has always been the case for Lush, the in-store experience is an integral part of its retailer’s DNA. In the ‘Naked’ store, staff were very helpful as it is a priority for them to make sure that shoppers go home with the right products to suit their individual needs, as well as knowing exactly how to use them when at home. Product knowledge was impressive, but knowledge of ingredients was even more so.

Although Lush Naked is a small store, there are still three sinks to test products. The experience in this store has a new dimension to it, as staff are keen to share insights on how to store the products, in addition to imparting knowledge on the bespoke packaging-free products. With regards to product storage, Lush has cleverly made this easy for shoppers while driving incremental sales with a range of branded and sustainable pots and containers. Its cork pot in particular stands out with its impressive environmental credentials of being carbon positive due to its production process.

Why this matters

The beauty of the store is that it makes it feel normal, simple and even fun to shop packaging-free: a great example of the Mintel Trend ‘Help Me Help Myself’, which focuses on a new era of self-improvement amongst consumers. The Trend explores how shoppers increasingly want companies to nudge them into making better decisions, with some using tools to help consumers stay on track of their personal goals. Indeed, that is the aim of the concept – with Lush’s owners taking action in order to help evolve consumer habits and make a difference to environmental issues of waste and plastic affecting the planet.

Priya Chandarana
Priya Chandarana

Priya is a Senior Research Analyst in Mintel’s Retail team. Prior to Mintel, Priya specialised in analysing the grocery discounter sector and has experience as a buyer.

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