By shifting the cost of household packaging waste from taxpayers to manufacturers, the legislation compels alcohol brands to navigate rising costs while maintaining sales and rethinking how products are presented to meet new compliance requirements.
The Extended Producer Responsibility (EPR) places greater responsibility on producers for the packaging of their products throughout the packaging’s lifecycle – from production to end-of-life disposal – putting greater accountability on businesses with the aim to encourage more sustainable choices.
When fundamentals like this shift, it is vital for brands to take a step back and really consider how to successfully present their product or services to customers when a new chapter begins. Marketers are a pivotal part of this process – with the power to drive a brand forward into a future of success.
Cost hikes – marketers’ critical challenge
EPR brings significant new costs for manufacturers, importers and retailers, and these will inevitably be passed on to shoppers. The most immediate issue for marketers to address is communicating delicately the increased prices for consumers – which is no small task amid a cost-of-living crisis.
Over the past year, people have felt the pinch from higher inflation rates, surging energy prices, and the rise in unemployment. The Autumn Budget has added to the strain by targeting Cash ISAs and salary-sacrifice for workplace pensions, as well as other popular savings strategies – leaving consumers feeling even more financially stretched.
Alongside this, businesses have been under immense pressure of late. Last year’s 0.2% increase in employer national insurance contributions, coupled with rising costs of food and energy, has resulted in the closure of many UK businesses. The hospitality industry estimated that 378 pubs would close their doors for good, in 2025 alone.
Alcohol brands are facing mounting costs, with Alcohol Duty set to rise by 3.66% under the latest Autumn Budget. This increase takes effect in February 2026, building on earlier reforms introduced in August 2023 and 2025 that shifted duty calculations to an ABV-based system.
It may feel tempting for alcohol brands to tighten their marketing budgets to protect margins, but this really is a critical moment. Those that put greater weight behind marketers are likely to boost their chances of long-term growth.
Tread carefully – the key for success
Brands should be reminded that stealth tax on alcohol is not a new concept. In 2023, Alcohol Duty was reformed to base tax on alcohol strength (ABV) regardless of type - causing many high-strength wines and spirits prices to skyrocket. Many brands adapted by lowering alcohol percentages, promoting naturally lower percentage products and even rebranding higher percentage products as something more premium that affluent consumers would enjoy.
Brand loyalty can be easily obstructed by increased costs, and with consumers continuing to face financial challenges, it is vital for marketing teams to tread with care. There are several techniques marketers can use to communicate price fluctuations effectively.
First and foremost, preparation is key. Increasing costs without notifying in advance can lead to customers feeling blindsided, which will erode trust. It sometimes pays to be transparent in the short-term, but in the long run, investing in clear communication will pay dividends.
Inform customers of any price modifications and the rationale behind it – in this instance, eco-friendly packaging for positive change. Letting customers know in advance provides time for them to financially plan, but equally it demonstrates that they are on this journey with you - and are a valued part of the brand’s community.
Another effective technique to consider is shifting the focus away from cost increases to value for money. By highlighting aspects like quality, durability, and sustainability, brands can justify a price point while positioning themselves as responsible and forward thinking. Those that get their messaging right, and handle the delivery with care, are much more likely to preserve brand loyalty - even as prices escalate.
Eco-credentials require conscious communication
Being eco-friendly often comes with financial trade-offs, which has led many brands to reconsider eco-first choices - yet the introduction of the EPR will well and truly shift this dynamic.
Especially given environmental concerns remain high for consumers – 70% want to adopt more sustainable practices, and are committed to the value these daily choices deliver.
The legislation strongly incentivises recyclable packaging, and while it may initially feel like a headache, it presents a timely opportunity for brands to rethink whether traditional packaging still serves a purpose, particularly when 30% of UK consumers are now willing to pay up to 10% more for a sustainable item compared to its non-sustainable equivalent. A trend reflected globally with a PwC survey finding that the average premium at around 9.7%
EPR creates space for creatives and marketers to collaborate on packaging that not only meets regulatory demands, but also communicates a clear message: we are driving positive change together. This shift is more than a compliance exercise – it’s a strategic opportunity for brands to strengthen their marketing organisational capability and future-proof operations, particularly in sustainable marketing and embracing EPR.
Brands that invest in these capabilities now will be better equipped to adapt to evolving regulations and consumer expectations. However, this opportunity must be approached with caution. Marketing to eco-conscious consumers is complex, and reputational risks remain high for brands that engage in, or appear to engage in, ‘greenwashing.’ Recent bans on adverts from three household names for misleading environmental claims underscore the importance of transparency. Marketers must adhere to the UK’s code of conduct on environmental claims and ensure robust evidence supports sustainability messaging across the entire product lifecycle.
Time for marketers to take centre stage
Ultimately, the EPR places marketers in an essential leadership role. Whether they expected it or not, marketers will be central in guiding alcohol brands as they adapt to the changes this new legislation brings.
Marketers are the foundation for brands during this period of flux, with the power to ensure transitions are smooth and customers are retained.
Rather than a regulatory burden, successful marketing teams should recognise the importance of embracing these packaging changes and putting the customer first. Those that move early may even find themselves with a competitive advantage – with packaging that truly engages and stands out from the crowd.
