Greener approach

How conscious consumers are driving change in eCommerce - sustainable eCommerce in the US. By Patrick Lowe


Pre-2020, brands and retailers were primarily focused on doing whatever it took to get orders into customers’ hands faster. The name of the game was fast and free. In order to compete with the major players online, brands and retailers were scrambling to keep up with increasing consumer demand for faster delivery at no charge.

Fast-forward to 2021. The dramatic increase in eCommerce demand resulting from the pandemic has advanced the industry at least two years ahead of prior projections. All eyes have been ‘online’ over the past year and the increased attention has made many consumers more aware of the environmental impact their online shopping habits have.

Convenience, cost and speed of delivery have traditionally been the three primary concerns associated with online ordering. Today, we’re looking at a fourth – sustainability. Brands and retailers must bring the issue to the front burner and consider how they can help meet the growing consumer demand for sustainable eCommerce.

Fast and ‘free’ comes at a price
Brands and retailers seeking to focus more on their sustainability credentials must start seeing opportunity where they previously saw obstacles. Brands who are slowing down delivery times and consolidating orders in the name of sustainability are, in fact, differentiating themselves in the marketplace1.

This is echoed in Digital Commerce 360’s 2020 Click, Ship & Return Report, which revealed that 15 per cent of shoppers claim to have opted in for longer shipping timeframes in support of sustainable practices during the Covid-19 pandemic2. Consumers, particularly millennials and younger generations, want to make a difference and they are looking to brands and retailers to make that possible for them.

As consumers become more aware of sustainable delivery methods, companies must prepare to meet the demand for these options. How that order comes packaged is also increasingly important to the conscious consumer.

When less is more: sustainable packaging
Packaging is the low hanging fruit for increasing operational sustainability, but that does not mean it isn’t impactful. Packaging is often one of the first things brands looking to become more sustainable address, switching to recyclable dunnage and packing material rather than less-sustainable packing peanuts or bubble wrap, applying gummed paper tape rather than traditional packing tape and eliminating paper pack slips.

Many brands, tired of damaged product returns, had already begun implementing right-size packaging practices or frustration free packaging (FFP), as a means to better protect products and reduce returns. In the first ten years of Amazon’s FFP operation, they eliminated 500+ million boxes and more than 244,000 tons of packaging materials – a significant pivot – but there is still more to be done.

During the pandemic, many consumers have shifted their focus back to brands, particularly in the health and beauty and jewelry sectors. Differentiating themselves as a brand is an absolute necessity to grow online and packaging is one of the key ways brands achieve this. In reality, sustainability is the differentiator – today’s conscious consumer is looking for environmentally friendly alternatives to an abundance of ribbon and excess packing material when opening a package.

Brands should look to use less packaging and more sustainable options as much as possible. Iconic brands or brands who are known for highly personalized experiences, are increasingly offering customers the ability to opt in to more sustainable packaging or delivery methods at checkout will empower consumers to uphold their values.

DOM-ination
The ability to route orders to the best fulfillment point depending on a customer’s location has become increasingly important during the pandemic. Alternative delivery methods such as curbside pick-up and buy online, pick-up in-store (BOPIS), leveraging dark stores during lockdown and standing up micro-fulfillment centers or pop-up distribution centers (DCs) are all made possible via distributed order management (DOM) technology.

Many brands and retailers are looking to de-centralize fulfillment operations to improve business continuity and provide higher-quality customer experiences. An effective DOM is critical to the success of these omnichannel solutions. With multi-node fulfillment, brands and retailers are able to appropriately spread inventory across regions and offer more delivery options while optimizing inventory across channels, all while shortening the distance for last-mile delivery Equip consumers to take the reins

Your average consumer is not fully aware of the ins and outs of eCommerce operations and they are not ‘sustainability scientists.’ It’s up to retailers and brands to be transparent about their sustainability initiatives, providing tangible information on the website that informs and educates consumers.

The ‘voluntary’ carbon offset market is growing rapidly as the desire to reduce environmental impact grows. Brands are seeking out ways to equip conscious consumers. One carbon footprint calculator startup has now offset five million lbs. of carbon dioxide emissions and is doubling its user base each month. Retailers are becoming increasingly transparent about their carbon footprint and make available in depth information on their sustainability.

Prior to the pandemic, some 74 per cent of US millennials said they were more likely to purchase from brands who support the social issues they care about. Brands and retailers must take a closer look at how they are resonating with consumers. As vaccines become more available and we get closer to finding a new normal, retailers should expect consumers to continue prioritizing sustainable shopping habits online and actively seek ways to set their brand apart through sustainable measures.

1. Maverick Research: The Demise of Same-Day and Next-Day Deliveries, Gartner, Inc., Tom Enright and John Johnson
2. Click, Ship & Return Report, Data and in-depth analysis of ecommerce fulfillment trends, 2020 Edition, Digital Commerce 360

PFS
Patrick Lowe is Area Vice President of Business Management at PFS. PFS is the operations business unit of PFSweb, Inc., a leading end-to-end eCommerce provider. It brings together technologies, systems and people to create exceptional customer experiences that drive revenue and maximize the impact of your brand.
www.pfscommerce.com