Sustainable E-Commerce – Will it Become a Must?

Sustainability in Online Shopping

Sustainability, as defined by the UN back in 1987, is “meeting the needs of the present without compromising the ability of future generations to meet their own needs.” Sustainable e-commerce seeks to minimize its environmental impact and ensure good working conditions and employee well-being. This includes changing business models in order to provide a good working environment and implementing green practices in logistics, packaging, transport, and waste handling.

Research has shown that a staggering 70% of consumers care about consuming more responsibly and are even willing to pay more for green products. This trend is on the rise, as some recent reports prove that around 60% of consumers have made changes to their shopping behavior in the last year in order to minimize the ecological impact. The contemporary consumer believes that brands and retailers are responsible for running their business sustainably and ethically, and is ready to hold them accountable. 

With online searches for sustainable goods having risen over 70% between 2017 and 2021, sustainability in e-commerce is no longer negotiable. Many retailers have already adopted an eco-friendly approach to e-commerce. Sustainable e-commerce offers carbon-neutral shipping options, avoids excessive packaging waste, and works to reduce returned deliveries and returns by improving product descriptions. A person-first approach to running a business that includes an eco-friendly supply chain as well as corporate social responsibility can have an immensely positive influence on the customers’ brand loyalty.

Green vs Greenwashing

Look no further for proof of the rising demand for green e-commerce than the fact that some brands misuse false claims of sustainability in order to attract customers. Dubbed “greenwashing”, this is the practice of brands attempting to increase sales by falsely advertising themselves as ethical, eco-friendly, and sustainable. 

As many as 40% of green e-commerce claims have proven to be misleading. Greenwashing brands give vague statements about sustainability, use design and packaging to give a more “green” impression, or even put non-accredited eco-labels and terms on products. However, consumers are becoming more aware of how to distinguish authentic sustainable e-commerce brands and retailers from those using greenwashing strategies. False advertising in sustainability can end up costing the brand its reputation, therefore, more and more companies are choosing to “go green” for real, with sustainable e-commerce now becoming the industry standard.

Reasons Businesses go Green

McKinsey & Co.’s 2020 survey revealed that 75% of millennial respondents considered sustainability as an important factor when making a purchase, proving that the conscious consumer has now become the norm.

As the environmentally conscious Millennials and Gen-Z go on to make up the dominant consumer demographics, ethical e-commerce is only going to become more important.

The new generations are less willing to compromise and will walk away from greenwashing and unsustainable businesses without batting an eye.

Early adoption of green e-commerce can make the business stand out in the highly competitive market, as over 50% of customers cited environmental impact as the reason to opt for one online retailer over another.

Also, sustainable e-commerce is future-oriented: investing in improving the company’s ethical approach now can save you from experiencing losses later.

Customers are happy to pay more for a sustainable, durable product as they consider it to be a long-term investment. This is particularly evident in fashion, where new trends to address sustainability are emerging. One of them is the “circular economy”, a model that promotes the reusing of existing products and the recycling of materials.

Offering “preloved” products at more affordable makes companies more competitive, especially in today’s inflation-ridden economy.

Sustainable e-commerce companies make the production process more effective by practicing a more efficient use of materials, recycling, and reducing packaging.

This way, they minimize waste, reduce energy consumption, and make the supply chains more efficient. By implementing sustainability in e-commerce, companies can save money while helping protect the environment. This, in turn, improves the company’s public image, ensuring better product sales.

Still not convinced? Well, seeing as more and more countries are introducing sustainability regulations to decrease carbon emissions, soon it will no longer be a matter of choice for companies to implement these measures. It just makes sense to get in on it sooner rather than later.

How to Communicate Sustainability?

The first rule of communicating sustainability is: do talk about sustainability. The second one? Don’t lie. When it comes to ethical e-commerce, actions speak as loud as words, and it is crucial that the company embodies the values it promotes – from caring about its workers to caring about the environment.

In communicating sustainability efforts, make sure to only put forward the information that can be verified. Transparency and authenticity are fundamental to consumer trust: once a company is caught greenwashing, it will lose this trust and it will be very difficult to bounce back. If possible, validate the information with official certificates of green commerce. However, don’t just go for simple solutions, as you might end up using visual clichés – sustainable e-commerce brands don’t always need to be represented by a combination of green and cardboard-color visuals.  

It would also be wise to steer clear of general proclamations on saving the environment as they might easily come off as generic and dishonest. Keep your message simple and be careful not to overwhelm the customers by getting tangled up in complex explanations. Use visual accessories when possible, such as charts, stats, infographics, callouts, images, videos, and animations.

Becoming a sustainable e-commerce brand is a long-term project. Companies are now required to practice what they preach and implement a holistic approach to sustainability that encompasses everything from production to delivery, from using recycled materials to reducing waste. Ethical e-commerce is an investment in the brand’s future that boosts the company’s public image and reduces costs in the long run. We have reached a point where embracing sustainability is a must for brands that don’t want to end up being left behind.

Sustainable E-Commerce Trends

When talking about common approaches to adopting sustainable e-commerce trends, the first thing that usually comes to mind is the packaging and shipping process.

Companies came up with different solutions, from reducing unnecessary packaging and making it reusable to offering CO²-neutral shipping options. For example, GLS’s ThinkGreen and DHL’s GoGreen initiatives aim to reduce gas emissions. Some retailers, such as Amazon, are adding electric vehicles to their fleets in an attempt to avoid fossil-fueled transport in the delivery process.

Averaging at almost 25%, return rates remain one of the burning issues of e-commerce. Some recent trends in e-commerce, such as AI (LINK) and live shopping (LINK), have proven to significantly reduce return rates, also eliminating additional waste in the process. Some brands, such as Zara, have even taken to predictive, planned demand in order to reduce product waste from seasonal collections. 

Fashion brands are increasingly looking to commit to the use of sustainable and recycled materials. Adidas, for example, has decided to phase out virgin polyester by as soon as 2024. Others are encouraging a circular economy – IKEA went all the way and pledged to become fully circular by 2030.

Finally, sustainability is not concerned only with the natural environment, but also with the work environment.

Sustainable e-commerce companies offer better work conditions (health and safety, working hours, benefits), and support diversity, equity, and inclusion.