Hot Take: Here’s what E-commerce Platforms Should Be Doing To Drive The Sustainability Agenda
Story time: My path to sustainability in fashion took several twists and turns over the course of my undergraduate studies. I had, what felt like endless ideas about how I could design more sustainable products. However, by the time I graduated, I knew that nothing I did as an individual designer was going to make the kind of impact I truly wanted to make. As fate would have it, I got an opportunity to work for a company that harnesses AI-powered technology to optimize fashion e-commerce. This role opened my eyes to the transformative potential of data and digital interfaces, revealing a path towards positive change in online shopping's mindless consumerism.
Let's face it, online shopping is omnipresent, deeply ingrained in our lives, and expanding at an astonishing pace. According to a 2022 report by Morgan Stanley, by 2026, E-commerce is projected to generate USD 5.4 trillion in annual revenue, with consistent growth and global adoption.
Consider your last ten purchases: how many were made online versus in person? In our digital and globalized world, convenience and accessibility drive us towards online shopping. Yet, the hidden costs outweigh the perceived benefits.
What are the real implications of our behaviour? Think of how many times a delivery executive comes to your door, how many plastic packages and card-board boxes are you collecting every week? How many times are you filing a request to return a product that doesn’t suit you or meet your expectations?
I know I’ve had to return at least half of what I ordered online in the past year and there are times when I’m physically uncomfortable looking at the number of empty packages I’m discarding.
Here are some figures to put it into perspective:
The World Economic Forum predicts that by 2030, there will be a 36% surge in delivery fleets across 100 major cities worldwide, leading to a corresponding 30% rise in carbon emissions.
A report published by Oceana, a leading marine conservation agency, found that retail behemoth Amazon.com alone produces over 709 million pounds of packaging waste in 2021, an increase of almost 18% from the previous year.
Noted business intelligence platform Business Insider, estimated 26.5% of all e-commerce orders in the U.S would be returned in 2022, with a merchandise dollar value of nearly $280 billion dollars.
Can you see how the actual carbon emissions and wastage associated with shopping online is far more overwhelming than we even realise?
Enough with the blame game and finger-pointing. We've surpassed that stage. It's time to recognize that both corporations and consumers bear a collective responsibility for transforming our consumption habits. It's imperative that we act now and make a resolute commitment to change the way we consume products. The future of our planet depends on it.
E-commerce companies hold one of the keys to a transformative future. By reimagining customer service for positive impact, offering carbon-conscious shipping, reducing packaging waste, and leveraging technology for features like virtual try-on experiences and meaningful personalized recommendations, they can unlock the benefits of online shopping while significantly reducing its environmental impact. It's a vivid tapestry of possibilities, where mindful consumption intertwines with captivating digital realms, guiding users towards informed choices and curbing needless returns.
Let’s look at these ideas in detail along with some examples of their real time applications.
1. Rethinking Returns Policy; Encouraging Responsible Consumption
E-commerce platforms possess the power to analyse customer data and identify users who frequently return products. By adjusting their policies accordingly, they can encourage a more responsible approach to returns.
For instance, Indian fashion e-commerce giant Myntra, has taken measures to limit free returns for customers who frequently return products. Additionally, they have implemented a convenience fee specifically for users with a high rate of returns and incentivised low returns by offering customers benefits such as special discount coupons as well as faster returns and refund approvals.
I understand that as consumers, we have been conditioned to disregard the consequences due to corporations aggressively vying for our attention and money. In fact, Myntra faced some backlash for their decision, and lost customers to their competitors. However, in pursuit of a greater good, it's crucial for companies to actively discourage frivolous returns. By doing so, not only are they going to see a positive impact on their net revenue, they can also significantly reduce waste, transportation emissions, and the overall carbon footprint associated with return shipments.
2. Sustainable Shipping Practices - Let’s go the Extra Mile!
E-commerce companies are responsible for a significant carbon footprint that can be attributed directly to logistics. A joint investigative effort by stand.earth and the Clean Mobility Collective revealed that six major logistics players are responsible for two-thirds of all C02 emissions associated with e-commerce logistics, approximately 4.5 megatons of CO2. There is an urgent need for companies to take decisive steps towards minimising the environmental impact of their operations.
One approach is to encourage longer shipment times, allowing customers to receive their entire order in one consolidated delivery. While Amazon has introduced this option, there's room to go even further and incentivize this behaviour. Imagine offering additional discount codes or perhaps a points system that customers can trade in for extra benefits on future orders—a win-win for both the planet and the shopper.
Another effective approach is to focus on route planning. By bundling orders heading to the same geographical region and carefully planning out last-mile delivery routes, e-commerce companies can significantly reduce the number of individual shipments, resulting in a noteworthy reduction in carbon footprint. Although it might slightly extend the duration of delivery, the overall sustainability benefits make it a worthwhile trade-off.
Lastly, imagine if the carbon impact of your order was highlighted at the checkout stage. This isn't about brands shaming consumers but empowering them with knowledge. Consider how it would influence your decision-making if you were presented with multiple shipping options, along with the corresponding carbon emissions for each. Wouldn't it help you make more thoughtful choices?
Interestingly, a survey conducted across 8000 shoppers in the UK, US, Canada and multiple European markets by Descartes, one of the largest retail-logistics companies in the world, revealed that 54% of customers would be willing to wait longer for their order if it meant lower carbon emissions and 20% would be willing to pay more.
3. Commit to Reducing Packaging Waste
To address the pressing issue of packaging waste in e-commerce orders, companies should invest in innovative and sustainable packaging solutions.
I remember, a couple of years ago, there was a glimmer of hope when industry giant Amazon.com committed to reducing single-use packaging in their shipments. They took steps like replacing bubble wrap and Styrofoam with eco-friendly alternatives and switching to water-activated packaging tape. However, it's disheartening to see that lately, they seem to have reverted to using plastic tape and wrapping.
Particularly in context of fashion, it’s time for e-commerce platforms to double down on their efforts to eliminate unnecessary layers of packaging. For instance, there's no need for clothes to be individually packaged in plastic sleeves. Take inspiration from the European e-commerce platform Zalando, who have switched out their packaging to 100% recycled paper boxes or envelopes and are committed to exploring and implementing ways to reduce and eliminate their use of plastic to wrap individual products.
By eliminating single-use plastic and exploring alternative eco-friendly materials, such as biodegradable or recyclable packaging, e-commerce platforms can make a substantial contribution to reducing plastic pollution. Implementing thoughtful packaging practices and educating customers about the importance of sustainable packaging choices is sure way to create a positive environmental impact.
Going a step further here, I’d also urge you to think about how much importance we give the “unboxing” experience. Brands now invest a considerable amount of money in developing elaborate packaging for their products, often at the cost of being recyclable, simply because research shows that consumers are more likely to purchase products with such packaging. I’m a sucker for good packaging myself, but when you really think about it, how many pretty boxes and containers can we hoard?
4. Revolutionizing Online Shopping with Virtual Try-Ons
The remarkable advancements in hyper-realistic graphics and the widespread adoption of augmented reality (AR) and virtual reality (VR) have opened incredible possibilities for transforming the online shopping experience. Thanks to the filters we enjoy on platforms like Snapchat, Instagram, and TikTok, AR has become an integral part of our daily lives. I firmly believe that we can harness the power of these technologies to revolutionize how customers shop online by offering virtual try-on experiences.
Imagine integrating a Body visualiser into the e-commerce journey, where users can create a digital representation of their own body type, combined with cutting-edge fashion industry technologies that render apparel products digitally. This combination would enable customers to assess the fit and suitability of multiple products, making more informed purchase decisions. Belgian start-up Shavatar, is already on its way to making this idea a reality.
Brands have already started using AR to influence purchases in innovative ways. For example, British fashion icon Burberry has leveraged AR technology to allow customers to interact with their iconic bags through their smartphone screens. Customers can evaluate important aspects such as size, proportions, and how the products would complement their outfits. In a notable 2020 collaboration with Google, Burberry showcased their iconic Black TB bag and Arthur Check Sneaker whenever users searched for relevant keywords.
If AR can motivate people to buy more, I firmly believe it can also be used to encourage people to make the "right" purchases. By using AR to evaluate product suitability before making a purchase, customers can ensure they buy products they will actually use, minimizing the need for returns. Virtual try-on features empower customers to make informed decisions, resulting in reduced unnecessary shipping and product waste associated with returns. By embracing these technologies, companies can enhance the shopping experience while promoting sustainability and responsible consumption.
5. Empowering Conscious Choices, The Potential of User Data
If I asked you to name your go-to fashion e-commerce websites, I'm sure you could easily come up with one or two. Most likely, you consistently shop from these major platforms. What you may not realize is that these platforms have a wealth of data about you, ranging from your purchase history to your preferred colours, styles, and even your sizes across different categories. Currently, brands use this data to bombard you with "personalized recommendations" that often lead to unnecessary purchases.
However, I believe there is a greater opportunity here for these platforms to steer consumer behaviour in a positive direction. Let's consider a couple of user journeys:
User A is browsing through a product catalogue and is intrigued by a particular dress. When they click for more details, they are also presented with a "virtual closet" showcasing dresses they have previously purchased, like the one they are currently considering.
User B is contemplating whether to buy a shirt. They can access their "virtual closet" to assess if they have other items like trousers, shoes, or accessories that would complement the shirt. By envisioning themselves wearing the shirt with existing items, they gain confidence in their purchasing decision or realize that this item may not be the right fit for them and explore other options.
Just imagine the possibilities of a virtual closet experience like this:
By offering "personalized recommendations" based on users' existing wardrobe, e-commerce platforms can empower customers to make more conscious choices, avoiding redundant purchases and reducing overconsumption. This approach promotes a mindful approach to shopping, aligning with our mission to drive positive change.
As e-commerce continues to evolve, we stand at a crossroads where the choices we make today will shape the world of tomorrow. It's no longer enough to simply click 'buy' without considering the consequences. Some may argue that the ideas presented here challenge the profit-driven nature of corporations, but our planet is facing unprecedented environmental challenges, and the mindless consumerism associated with online shopping exacerbates these issues. However, with the growing focus on the need for impactful change and the increasing consumer awareness of the importance of mindful choices, companies can reap greater benefits by reducing returns and earning goodwill and investor confidence through sustainability and positive impact initiatives.
There is a need for cohesiveness in action, as long as e-commerce platforms offer consumers an easy way out, the price or convenience sensitive consumer will keep shifting between one platform and the other simply because they have been conditioned to do so. When all the platforms execute a similar set of strategies and hold themselves to a unified set of standards, consumers will in turn learn new behaviours.
By de-influencing users and redirecting their attention to their purchasing habits, E-commerce platforms can seize this opportunity to redefine online shopping, not as a mindless transaction but as a conscious act of empowerment. Platforms can implement strategies that encourage conscious consumption, minimize waste, and champion sustainability. From re-evaluating returns policies, to embracing sustainable shipping practices, investing in plastic-free packaging, and using technology for the greater good instead of mere greed, e-commerce companies have the opportunity, or rather, a responsibility to play a pivotal role in facilitating a more sustainable and responsible business landscape.