NEW YORK (AdAge.com) -- Sigg, maker of the metal, reusable bottles that became a badge of consumer eco-consciousness and all-around cool, is in danger of becoming a poster child for brand deception and corporate dishonesty.
The marketing darling, which saw its business explode in 2007 as a result of environmental concerns and fears surrounding the use of Bisphenol-A, or BPA, in plastic bottles, is doing some crisis control after admitting some of its bottles do, in fact, contain BPA.
The pricey metal bottles have built a loyal following thanks to trendy designs and star appeal. Placement at London Fashion Week and Sundance Channel events, as well as designs featuring Hannah Montana and celebrating America and Earth Day, have helped the brand cultivate a contemporary image. Information on Sigg sales isn't publicly available, but sales are pegged at about $100 million. Sales rose 250% between 2006 and 2007, and that was before the bottled-water and BPA debates really heated up. The brand is available in 15,000 stores worldwide.
Now consumers are lashing out in response to a letter posted by Sigg CEO Steve Wasik. The letter admits that bottles produced before August 2008 contain trace amounts of BPA in the bottle liner. The company has carefully crafted its message in recent years, letting consumers believe and, in some cases, the media report that its bottles were BPA-free.
BPA, a compound used in plastics, began raising eyebrows when several regulatory groups expressed concerns about its impact on children. Since then, several states have considered regulations limiting or banning BPA, and last fall Canada labeled BPA a toxic substance.
Wasik on back foot
Mr. Wasik defended the company, saying that previously the conversation surrounding BPA was focused on leaching. Sigg's bottles showed 0% leaching, so why mention it, the argument seemed to go. "The primary reason that I am writing this letter today is because I believe that the BPA conversation has changed dramatically in the last 12 months," Mr. Wasik said in the letter. "Last year, the primary concern was that of BPA leaching from bottles. Since that time the dialogue has evolved such that now some people are concerned about the mere presence of BPA and some states are considering legislation."
Further angering consumers, Sigg began working on a new, BPA-free liner in 2006 and invested $1 million in new equipment to produce its BPA-free EcoCare liner. Yet, the company was less than transparent in communicating that to the public.
"They were aggressive in responding to anyone that said they did [have BPA]. It was very cleverly constructed to look like it was a denial that BPA was in the product, but it wasn't," Jeremiah McNichols, co-editor and publisher of the blog Z Recommends, which targets parents. "It's incredibly damaging. At this point, we're not really sure what they're going to be able to do to salvage the situation."
Lack of brand transparency
Elaine Shannon, editor in chief at the Environmental Working Group, said in some ways, the situation is less about the presence of BPA and more about the way the company has handled the situation. "Americans want transparency, and this company doesn't seem to understand that. It's mystifying," she said. "[Mr. Wasik's letter] seems to be talking down to people, and a lot of people won't tolerate that tone."
Indeed, consumers are turning to social media sites such as Twitter and a slew of environmental and parenting blogs to criticize the brand. Mr. Wasik's Twitter profile, @siggceo, hasn't been updated since Aug. 16. He did, however, publish his e-mail address in the letter, and several of his responses to consumers' e-mails have been posted online. Mr. Wasik told Ad Age he has been personally communicating with hundreds of consumers and bloggers.
Mr. Wasik said the company is considering larger-scale outreach to publicize the fact that consumers can trade in old bottles. Consumers can get their old bottles replaced with new ones if they pay part of the shipping costs. Retailers with old inventory can contact the company directly to discuss the situation.
"If a retailer chooses to keep them on their shelves, that is their choice," Mr. Wasik wrote in an e-mail. "All of our resources are focused on servicing consumers and our retail partners. I believe the best thing we can do for the Sigg brand is to address any concerns and act swiftly to resolve issues."
Can CamelBak, Klean Kanteen capitalize?
Mitch Baranowski, founding partner at BBMG, which produces the Conscious Consumer Report, said Sigg could be doing more to respond to consumers and explain themselves. "They would be wise to pay close attention to this engaged, passionate group of consumers that are asking for transparency," he said. "Otherwise there is a risk that it could continue to gain steam and people could look to other alternatives in the marketplace."
Already reviews of Sigg alternatives have been popping up all over the web. And rival brands, such as CamelBak and Klean Kanteen, have publicly addressed the situation with letters on their own sites, reassuring consumers they are BPA-free, subtly damning Sigg.
"We empathize with consumers who are now discovering the presence of BPA in their aluminum bottle liners, particularly when they believed they had specifically chosen a BPA-free option," wrote Klean Kanteen owners Jeff Cresswell and Michelle Kalberer, in their letter. "Not all metal bottles are created equal when it comes to health and human safety."