Ecommerce Trends

What are ecommerce companies doing to lessen their impact on the environment? – Econsultancy

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on 04/10/2020
What are ecommerce companies doing to lessen their impact on the environment? – Econsultancy
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Sustainability is a growing concern for consumers, but at the same time, convenience remains the biggest motivation when it comes to buying online.

This was highlighted in a recent report by Getty Images, which found that – while 48% of consumers say they know they should care more about the environment through their purchasing habits – convenience takes priority.

This is the dichotomy that ecommerce companies now face. In his piece on the biggest marketing and digital trends for 2020 to 2030, Ashley Friedlin states: “The inconvenient truth we need to face in the coming decade is that it is the very same ‘effortless customer experience’ that we strive to deliver that is also driving an ecommerce revolution that may be damaging the planet we’re trying to protect.”

It’s a subject that many in online retail are starting to recognise. From innovations in packaging to carbon neutral shipping – what are ecommerce brands doing to drive sustainability (without compromising the convenience that customers have come to expect)?

Click-and-collect, and other carbon efficient delivery solutions

For Nike, packaging (which we’ll look at further down the page) is just one aspect of its sustainability strategy, which it calls ‘Nike circular design’. Essentially, it involves integrating sustainable solutions into the entire design process, “inclusive of how we source it, make it, use it, return it, and, ultimately, how we reimagine it”, states the brand.

Nike isn’t the only one focusing on end-to-end sustainability, as concern about the carbon footprint of ecommerce deliveries grows. Interestingly, there are some who maintain that online shopping is better for the environment than buying from brick-and-mortar stores. One of these voices is Jeff Bezos, who in his annual shareholder letter claimed that “shopping online is already inherently more carbon efficient than going to the store”. Bezos backs up this claim by citing a study that found “a single delivery van trip can take approximately 100 roundtrip car journeys off the road on average.”

As Wired argues, however, this fails to take into consideration multiple other factors that could actually make ecommerce less carbon efficient, such as how the customer might otherwise get to the store (e.g. walking or cycling), how the food or grocery items are manufactured, as well as other consumer behaviour such as little and often online orders compared to one big brick-and-mortar shop.

Indeed, other research suggests that ecommerce deliveries – and specifically the ‘last mile’ – massively contributes to carbon emissions. According to Doddle, if the 17.1m UK customers who buy online every week only ordered for click-and-collect rather than delivery, only 4,600 vans would be required, compared to the 170,000 currently used. Positively, Doddle’s research suggests that this is one aspect of online shopping that consumers are willing to change. It found that 56% of consumers aged 18 to 24 year old would be persuaded to buy from a competitor who offered a more sustainable fulfillment option, compared to 40% of 45+ year old consumers.

Despite recent claims by Bezos, Amazon is evidently aware of the need for carbon efficient options, as well as the potential backlash from consumers if it does not provide them. In the past few years, Amazon has rolled out a number of sustainable initiatives such as ‘no-rush delivery’, which lets customers opt for a slower delivery option in exchange for rewards or a discount. Similarly, the ‘Amazon Day’ delivery option enables Prime members to choose a specific day to receive all their Amazon deliveries, thereby reducing the amount of individual trips. Both initiatives are part of the companies aim to make “shipments net zero carbon, with 50% of all shipments net zero by 2030.” More recently, Amazon announced the $2bn Climate Pledge Fund to aid the development of sustainable technologies and services in order for it to reach its goal.

Of course, Amazon has a long way to go in order to convince critics that it can offset its negative impact – or even that it is serious about doing so. As well as minimal promotion of sustainable delivery options, critics also suggest that Amazon’s negative impact on the environment is growing. As The Verge states, the fact that “Amazon pumped out about 15% more carbon dioxide last year than it did in the year prior, as its sales increased” is hard to ignore.

Of course, like many other ecommerce sites, Amazon doesn’t directly deliver its parcels, meaning delivery companies also need to do more. Changes are being made, but not at the level you might expect. Royal Mail currently has a fleet of 100 electric vehicles, while Hermes uses just 32 electric vans in London, and DPD says it is only going to purchase electric vehicles in future. This is certainly positive, however, the pace of change is slow, which is something that influential companies like Amazon could help to speed up by imposing stricter standards.

Sustainable brands driving innovation in packaging

Ecommerce contributes hugely to global waste. Retailers often offer the convenience of same-day or next-day delivery – and may package items individually rather than together. As well as any plastic or non-recyclable packaging, the sheer amount of deliveries made also has a negative impact on the environment due to increased carbon emissions. In 2018, Limeloop estimated that approximately 165 billion packages are shipped in the US each year.

This is now a widely recognised problem, but solutions are appearing, and unsurprisingly many are coming from brands that already think of sustainability as a core value. Allbirds is one example; the footwear brand leads the way in both sustainable product and packaging solutions. As well as selling shoes made from sustainable materials, Allbirds shoeboxes are made from 90% recycled cardboard, which is certified by the FSC (Forest Stewardship Council), and uses 40% less material than traditional packaging. The material isn’t only used for its online orders either; it is also used for in-store purchases, with the addition of a rope handle enabling customers to carry their purchases home.

Recycled packaging is also a priority for multichannel retailer Patagonia, which has pledged to fully convert its polybags to 100% recycled material. Polybags are used to individually wrap the brand’s products in order to protect them during shipping and handling, however, they are not commonly recycled in US curbside recycling systems. Without polybags, items can be easily damaged, which is why Patagonia is still working on a biodegradable alternative (as well as other forms of paper packaging). In the meantime, the brand strives to educate customers on how to partake in proper disposal, pointing them in the direction of polybag recycling options in supermarkets as well as its own stores.

Elsewhere, big brands such as Nike and Adidas are making promises to further reduce plastic use within the supply chain. Adidas has pledged that, from 2021, packaging used to transport products from manufacturing countries to stores will be made from recycled materials.

Nike also recognises the impact of operations, resulting in the brand implementing a programme that reuses corrugated cardboard boxes for shipping, rather than sending it off as waste to landfill sites. Speaking on a roundtable with Design Boom, Nike’s chief sustainability officer, Noel Kinder commented: “Operational progress is what moves the needle and lowers our carbon footprint or waste footprint. Packaging is not the most sexy thing that we would talk about, but it’s really important from just minimising the amount of weight that goes into a shipment i.e. less carbon embedded when products are shipped.”

One solution has been to introduce alternative solutions to reduce the amount of material that goes into standard packaging. Nike’s new ‘one-box’ system, for example, uses a single box of cardboard, rather than the usual shoebox that comes inside a bigger cardboard box.

Reusable packaging and recycling incentives

As Patagonia shows, responsibility (or where it lies) is another issue of importance, because even if brands offer recyclable packaging, it doesn’t necessarily guarantee that customers will properly recycle it.

This has led to further innovation, such as the creation of reusable or refillable packaging, particularly in the beauty industry where the design and appearance of products is often part of the appeal for consumers – but where single-use plastic is rife.

L’Occitane, for example, now offers ‘eco refills’ to allow customers to top up their favourite products from pouches that use 60% to 90% less plastic than regular packaging. L’Occitane is also working with Loop Industries, a circular shopping system that enables brands to transition from single-use, disposable packaging to reusable and durable containers. The brand aims to ‘achieve our goal of using 100% recycled plastic in our bottles by 2025’. Other companies within the beauty industry and FMCG have signed up, including the Body Shop, Unilever, and P&G.

Meanwhile, companies like Repack are aiming to revolutionise ecommerce packaging. Describing itself as a ‘reuse as a service’ company, Repack provides ecommerce brands (and their customers) with returnable and reusable packaging, as well as incentives for customers to send the packaging back rather than immediately bin it. This enables brands to implement a circular economy, as well as incentivises customers to return to sites that offer the service.

Calls for carbon labelling, and even a carbon tax on businesses?

Meanwhile, brands like Allbirds are doing all they can in the fight to combat climate change. In 2019, Allbirds announced the Carbon Fund – a self-imposed carbon tax that funds emissions-reduction projects. The brand determined that it produces 10kg of carbon for a single pair of trainers, which then costs 10 cents to offset through investment in clean energy projects such as tree planting.

Allbirds is a B Corporation company with an Impact Score of 89.4 (a measure of how its day-to-day operations create positive impact for the company’s workers, community, and environment). Allbirds’ environmental work accounts for 28.6 points, making it the largest score in the assessed areas.

Allbirds is a unique example, and one that (unless enforced) ecommerce companies are unlikely to follow. However, the increase in online shopping due to Covid-19 has spurred on new calls for businesses to display greater transparency when it comes to the carbon emissions of individual products. To do this, brands must introduce ‘carbon labelling’, i.e. to label products with the calculated amount of carbon emissions created as a by-product of manufacturing and transporting products from wholesale to customer.

In January of this year, Quorn was one of the first major brands to introduce carbon labelling, with the aim of helping customers make informed decisions about the items they buy. There’s a long way to go before this type of action becomes implemented as an ecommerce standard, not to mention whether or not it even factors into customers’ purchasing decisions (in the same way nutrition labelling might prevent or encourage buying certain grocery items).

With that said, perhaps consumers will be more inclined to consider carbon labelling on fashion or technology purchases, which are more considered and made less often, rather than groceries, which are more regular (and where convenience is more important). Moreover, as Nishan Degnarain for Forbes suggests, “in a world where companies, employees and customers are searching for more ‘purpose’ in their corporate interactions, this could be a key differentiator for an ethical ecommerce platform of the future.” Listen up, Amazon.

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