Sustainability In Retail: Good For Business, Great For Humanity
Easy Ways Retailers And Brands Can Make Their Supply Chains And Businesses Even More Sustainable Through Technology
Consumers, especially younger ones, are seeking brands that publicly champion values that align with their own. They’re demanding socially conscious mission statements, checking the political views of executives, and pressing companies to make both their products and businesses sustainable. Their concerns are not limited to materials and packaging. They’re looking to buy from companies that focus on sustainability across the entire supply chain and all business operations. But creating and meeting sustainable brand goals is more than good PR—it’s a moral responsibility, and I predict that the brand boycotts we’re beginning to see over social issues will soon become major considerations for all responsible retailers and brands as they set strategies around sustainability.
A 2018 survey from data platform Euclid found that “52% of millennials and 48% of Gen Xers feel it’s important that their values align with the brands they like,” while 35% of baby boomers surveyed felt the same way. For retailers and brands, focusing on sustainable practices is not only crucial to protect the environment, but also a key way to attract younger generations of consumers and drive long-term brand loyalty.
Young consumers are especially concerned about sustainability issues within the fashion and apparel industry. There are numerous ways retailers and brands can make their supply chain and business operations more sustainable, but many companies haven’t yet implemented them. And these will only become more difficult to roll out as time goes on and consumer habits are formed. The ease of ordering via e-commerce has encouraged some shoppers to order three or four items to try at home with the intention of returning all but one. Free return guarantees mean there’s no downside or additional cost to the shopper for doing this, but the practice results in a completely unnecessary and wasteful shuttling of goods back and forth between retailers and shoppers, even when companies encourage shoppers to make e-commerce returns at physical stores. Whether it’s the company paying for a shipper to return an unwanted item to a warehouse or the customer paying for their own gas to take it to a store, the return is wasteful and costly in both dollar and environmental terms.
Another point, and one I’ve been making for a while, is around the industry trend of very fast shipping, so much that many retailers are now offering, or working towards one-day and even same-day shipping, which may soon become a standard customer expectation. These create more pressure from an ecological and logistical inefficiencies standpoint, and one that retailers are aware of and trying to solve for. The good news is that there are innovative, scalable, and even eco-friendly ways to go about the problem for some consumer shopping use cases.
As I wrote in my last column, a great first step to satisfy customers without minimizing margins is the notion of decoupling delivery from shipping.
‘Delivery’ means that the item was delivered through a digital experience. This has no boundaries or limitations, and also reduces the negative environmental implication. By offering customers the option of digital delivery of a product and the ability to customize the order before shipment, retailers and brands can help promote sustainability, especially when the product is being given as a gift. The recipient gets the experience of receiving and “unwrapping” a digital gift immediately, so she is likely to be more willing to wait a few extra days for delivery of the physical item. That allows the retailer to ship the item on an ecologically efficient route and schedule, ensuring lower emissions and less waste.
Not to mention that delightful digital delivery experience, where the recipient receives a digitally “wrapped” package, is an easy way for retailers to eliminate the need for costly and wasteful gift-wrapping services. According to clean technology news site AZoCleantech, gift wrap and packaging account for nearly half of the 85 million tons of paper consumed in the US each year, and gift wrap is notorious for being difficult to recycle.
Digital delivery also gives recipients a chance to make any needed or desired changes to an order before the product ships, slashing return rates. The process saves the environment from another unnecessary product shipment and saves the recipient from the inconvenience of having to return an item.
These problems are easily tackled today with the right fintech solutions. By gathering customer transaction and preference data, and putting that data to work synergistically with the rest of business operations, retailers can streamline the digital experience to provide a satisfying delivery, even without a physical shipment.
Today’s Sustainability Leaders Understand Both Their Own Footprints and Their Customers’ Desires
Using sustainably harvested fibers and materials, creating products and packaging from recycled materials, and using digital technologies that help deliver the convenient and memorable shopping and gift-giving experiences consumers want can all help lower costs, waste and resource usage. The good news is that more and more retailers and brands are already taking on the issue in terms of their production materials and use of resources, and earning lifelong brand fans in return.
Patagonia has long set the standard on sustainability, but young, digitally native footwear brands like Allbirds and Greats and established apparel brands like Eileen Fisher are also standouts on sustainability. These companies are helping lead the industry by investing in sustainable materials and processes and making those investments a core part of their brand promise.
Allbirds touts its use of natural fibers over synthetic versions, as well as its minimal use of packaging, 90% of which is post-consumer recycled cardboard. Greats’ newest shoe model is made entirely from yarn spun from recycled plastic and the shoes are delivered in a box that’s also made of recycled material.
Eileen Fisher laid out its Vision 2020 plan in 2015 and committed to using sustainable materials whenever possible. The company pledged to use all organic cotton and linens by next year and to work to boost industry demand for more environmentally responsible dyes.
Sustainable manufacturing and shipping practices should be at the forefront of every retailer’s and brand’s priorities in the coming years. Using sustainably harvested materials, recycled packaging, and efficient shipping and delivery methods is not only a responsible and forward-thinking strategy, but also an excellent way to attract younger shoppers and build brand loyalty and lifetime value.