As the e-commerce industry continues rapidly expanding, environmental sustainability is becoming a higher and higher priority for companies and consumers alike. To meet this moment, e-commerce brands have both an opportunity and a responsibility to create more sustainable products, operations, and initiatives.
“We are now in a time where sustainability talk is more than just buzz words thrown about in marketing meetings,” wrote Forbes Councils member Jen Root on Forbes.com. “I think we are past the point of sustainability as a trend and moving toward an era where sustainability is imperative for a business’ adaptability and growth.”
Why Should Brands Take E-Commerce Sustainability Seriously?
Ever heard of catering to your audience? One reason brands should take sustainability seriously is that consumers do: Consumers want to shop from values-driven brands that are environmentally responsible, and are increasingly willing to spend more for sustainable products. A 2019 Accenture survey found that 83% of the 6,000 consumers surveyed would pay more for sustainable products they could reuse or recycle.
“While globalization fuels both the evolution and future of e-commerce, mass demand for international shipping has put a strain on the environment—something of increasing concern to many consumers,” said Pathfinder 23’s E-Commerce Strategy Director, Piotr Tomczuk, who cited sustainability as a critical issue in the future of e-commerce. Not only do consumers around the globe consider the environmental footprint of a company before buying its products, but they also want eco-friendly packaging and more sustainable products.
So, should e-commerce brands give consumers what they want? Signs point to yes. Experts like Tomczuk, Pathfinder 23, Brand New Galaxy, and content26 can assist with navigating e-commerce trends, building brand loyalty, and capturing a growing market of environmentally conscious consumers.
Where is E-Commerce Sustainability Currently Falling Short?
We’re considering three primary factors when looking to the future of e-commerce sustainability: packaging, products, and shipping, all of which can and will significantly impact the environment.
The negative environmental effect of packaging from online shopping is a no-brainer. “Every year, 165 billion packages are shipped in the US, which uses enough cardboard to equal more than 1 billion trees,” wrote Blake Morgan on Forbes.com. “That doesn’t even consider the waste from the plastic air bags and additional packaging that keep items safe in transit.”
E-commerce companies need more sustainable packaging options, which today often contain materials that are both harmful to the environment and difficult to recycle.
Because consumers are reportedly willing to spend more money on sustainable products, this should be a simple equation: e-commerce brand + sustainable products = increased revenue. But in its report, The legacy of lockdown on supply chain sustainability, based on surveys completed by companies with an e-commerce presence, the London-based SCALA Group found that:
- Only 18% of the surveyed businesses are accurately measuring their environmental impact
- 32% reported they have taken no action to reduce the environmental impact of their e-commerce supply chain operations
- 27% of businesses have no long-term plans to reduce their environmental impact
What or where is the disconnect here? John Perry, Managing Director at SCALA, observed: “The problem companies have when it comes to sustainability is getting started—we can’t keep saying we’re setting targets for decades away when we need action now.”
Consumers want to buy more sustainable products, and they want them delivered ASAP—or do they? E-commerce companies have stepped up their game in the past few years, offering consumers two-day, one-day, and even same-day delivery. Some of the time, the shipping and handling cost is conveniently free.
As Patricia van Loon, assistant professor of supply and operations management at Sweden’s Chalmers University of Technology, told the New York Times in 2021, “Whenever I speak to companies, they say, ‘It’s so important to deliver fast…’ And when I speak to customers, they say, ‘Well, I want to be more environmentally friendly, and I don’t care if it is same-day, and very often I don’t need it. I just want to know when it will arrive.’”
Companies and e-commerce brands usually prioritize and “guarantee” customer satisfaction, but are the consumers satisfied? Along with his students, Josué Velázquez Martínez, director of the Sustainable Logistics Initiative at the Massachusetts Institute of Technology, created a project for a Mexican retailer that showed online shoppers questions at checkout.
“One question asked whether they would accept slower shipping if it meant lower CO₂ emissions; another, whether a shopper would accept slower shipping if it saved the equivalent of a certain number of trees,” Martínez said.
The retailer believed that the customers would only value the fast-shipping options. However, 71% of online shoppers chose the slower shipping option. “It would be fantastic to see Amazon or Walmart or any other monster of e-commerce actually measure the transport emissions, get the estimates of the impacts of fast shipping online or shopping in-store, and then display this information to consumers so they can make an educated decision.”
What E-Commerce Sustainability Efforts are Currently Being Made?
Despite the current shortcomings of e-commerce sustainability, plenty of companies prioritize efforts to decrease their impact on the environment. Using sustainable packing, reducing the carbon footprint of transportation, and designing products to be recyclable are all examples.
Brands such as Samsung, Puma, Zara, and Hasbro have repurposed and produced recyclable and reusable packaging. Amazon‘s Climate Pledge aims to increase e-commerce sustainability by pledging to be net-carbon neutral by 2040 and making 50% of all shipments net-zero carbon by 2030. In some cases, Amazon’s efforts to create innovative packaging solutions have reduced packaging components by 83%, package volume by 81%, and air-shipped by 93%. They also want to make Amazon device packaging 100% curbside recyclable by next year and source all of the wood fiber in their packaging from recycled sources or forests that are responsibly managed.
Reducing the Carbon Footprint of Transportation
Amazon’s two-day and same-day delivery services wouldn’t be possible without quick and available transportation. But how can they reach net-zero carbon emissions with all of the delivery vehicles and airplanes needed? In 2019, the tech company ordered 100,000 Rivian custom electric delivery vehicles. By 2030, they plan to have all the vehicles deployed. Amazon also plans on electrifying its fleets in Europe and India. Amazon delivers packages by bicycle and foot to reduce emissions for last-mile delivery. They’re also looking into new freight and air transport and autonomous delivery devices.
Designing Recyclable Products
Consumers are willing to spend more money on sustainable products, which include products made with recyclable materials that are not harmful to the environment. Zara, the “fast-fashion” brand, has pledged that by 2025, all of its eight brands will only use cotton, linen, and polyester that’s organic, sustainable, or recycled, which is 90% of the raw materials it uses.” Zalando, a German company and the largest online-only retailer in Europe, will require sustainability assessment for all its brands starting in 2023. Any brand that doesn’t pass the assessment or improve its score won’t be able to sell on Zalando’s platform.
These companies and more are not only maximizing an important growth opportunity, but they’re also doing the right thing, “because the science is clear: our planet simply cannot sustain our rate of consumption.”