Making e-commerce sustainable
With e-commerce's environmental impact a growing concern, a host of brands are finding novel, more sustainable ways to sell and deliver goods.
Globally, the e-commerce market will grow by 11% annually to reach $24.5 trillion in value by 2025, according to Meticulous Research. It’s an exciting time to be selling online, but all that growth also comes at an environmental cost.
First there’s the excessive packaging. And by excessive, we really do mean excessive. Anyone who’s ordered a single, small item online, only to receive a disproportionately enormous box, with a dozen inflated protective plastic bags, not to mention a handful of delivery and return slips, will know just how unrestrained this packaging can be. With the number one priority for consumers over the next decade being to use less packaging and more recycled materials, according to a study by ThoughtWorks, brands will need to find ways to reduce this.
Then there’s the logistics. Shipped e-commerce goods involve multiple transport stages, and items during much of that journey are being divided up into many single routes as they make their way to individual properties. That’s a lot of greenhouse gases. And if air freight is involved – even worse.
The trouble for brands is that in our Amazon Prime-era, people now expect items to arrive the next or even same day, to be packaged in well-thought-out ways, and for returns to be carried out without fuss. Yet these very e-commerce breakthroughs, which require more packaging and a complex and responsive logistical system, may well be contributing further to environmental harm. So, what to do?
Some companies have started by taking the long-view, setting future goals that they can gradually work towards. Amazon itself, which shipped over five billion items through Amazon Prime in 2017, is aiming to make half of its shipments net carbon zero by 2030 as part of its ‘Shipment Zero’ initiative, with much of this, the company hopes, achievable through electric transportation.
Online marketplace Etsy, which doesn’t control the shipping of its millions of sellers, has at least acknowledged the problem, and purchased verified carbon credits in an attempt to offset the environmental impact of the hordes of shipped items. Interestingly, according to a recent Fast Company article, the company vowed to carry out the offsetting itself only once it realised that, when this duty is left to customers, only 10% to 20% will actually choose to buy the credits.
But while consumers may not be prepared to cough up for carbon offsetting, they might be willing to at least reduce their e-commerce packaging – especially if there’s an incentive. Target is doing just this with its eco-friendly delivery option available at the point of sale. Here, customers are given a discount if they opt for consolidated shipping, under the thinking that one shipment of multiple items will contribute less environmental harm than multiple shipments that get sent as soon as each item becomes available to ship.
The rise of refillables
Other brands are considering the product packaging itself, and thinking, in particular, about how this can be re-used.
A novel example is the US-based household goods brand Blueland, which forgoes bulky, liquid-based products in favour of small tablets. Customers initially purchase a starter kit, complete with three spray bottles. Tablets are placed inside, and when water is added, the cleaning product becomes ‘activated’. Once the liquid runs dry, the customer simply orders new tablets, greatly reducing the logistical space and packaging required for larger, liquid-carrying bottles.
In a recent article in Fast Company, Heather Kauffman, COO of beauty company Full Circle, succinctly underlined the sustainability problem associated with household goods. “We’re basically shipping water around the country,” she told the magazine. “Water is something we all have readily available at home. If you think about the carbon emissions required to ship bottles largely filled with water from the manufacturer to the retailer and then to the consumer’s home, it really adds up.”
Another US-based brand, By Humankind, is inspired to tackle the huge amount of waste associated with the beauty industry to create refillable cosmetic products. The products are essentially container shells, which house within them a useable beauty formulation – a deodorant, mouthwash, shampoo, and so on – and have been designed in an aesthetically-minded way, suited to having a constant presence in an aspirational consumer’s bathroom. The refills arrive as solid products, such as a solid shampoo and tablets for mouthwash, which – similar to Blueland – can be activated once added with water.
Using this same refillable container principle, but marrying it with a delivery service, is Loop, created by New Jersey-based recycling company TerraCycle. The concept, which has brought on-board large-scale FMCG companies, such as Nestlé, Unilever and Coca-Cola, sees everyday consumable goods, from Häagen-Dazs ice cream to Crest mouthwash, be delivered by a courier to customers in re-useable containers. The customer stores these containers, slowly using their contents as they would any consumer product, only to then return the empty containers back to the Loop courier. These are then washed out and re-filled with new goods, ready for another customer delivery. In effect, the idea combines the high convenience of modern grocery delivery with a sustainable, package-lite solution.
Another major culprit in unsustainable e-commerce is the fashion industry. Largely based around a revolving door of trends and products that are hot one minute and cold the next, some fashion innovators are seeking out ways to curb this disposability.
US fashion brand For Days has an approach based around its membership-based service of t-shirts. Once customers of the brand buy a t-shirt, they have the ability to swap this item at a later date for a new version, for a modest fee of $8. The returned, worn t-shirts meanwhile are repurposed into new ones by the company, eventually sold again to new or existing customers. In this case, the revolving door is about material waste being recycled, rather than just aesthetic trends.
The company this year partnered with bra brand Harper Wilde, lending its expertise to the recycling of undergarments. Customers can send Harper Wilde their discarded bras, whether or not they were originally produced by the Harper Wilde brand. Importantly, the programme avoids adding to the growing number of e-commerce packages already being sent, as it allows people to send used bras with the returns of their new Harper Wilde bra, essentially hitching a ride in the same package.
From packaging to delivery, the logistical framework of e-commerce is gradually undergoing a sustainable re-think, and these innovators point to how we may be experiencing new conscious services from major e-commerce brands that crucially avoid compromising speed, convenience and service.
Challenges around sustainability and long-term thinking are paramount to SCB Partners’ work, and we’ve helped many clients – through speaking with customers and charting future trends – navigate this tricky space, ensuring that important, environmental actions are being taken while commercial goals are still being achieved. Just drop us a line to hear more.