Sustainable Ecommerce: From Proof to Practice

Since the Industrial Revolution, people have been focused on what a product can do to make their lives easier.

Electricity is a miracle that lets you extend your day late into the night, while cars transport us wondrously from Point A to Point B. Items we purchase online show up at our house days or even hours later, lovingly bundled in cocoons of plastic and styrofoam.

In recent years, there has been a switch, as concern for the future of our planet and efforts to combat the impacts of global warming are on the rise.

Consumers have begun to realize that the efficiencies that have become the underpinnings of our modern culture — from lightning-fast shipping speeds to single-use plastic packaging — are also not something we can sustain with our planet’s finite resources.

The Yale Program on Climate Change Communication found that between 2017 and 2021, the number of Americans alarmed about global climate change nearly doubled.

The goal of greater sustainability has also grown in ecommerce, where some of our greatest conveniences are being recognized for their heavy environmental impact.

The Impact of Ecommerce on the Environment

It is easy to assume that the rise of ecommerce online stores would lead to a lower environmental burden, considering how much operations have in turn shifted online. However, this assumption ignores the sheer immensity that ecommerce has become and what that entails.

To put it into perspective, by 2025, retail ecommerce sales are projected to hit more than $1.6 trillion — more than double that of 2020. Additionally, more than 40% of U.S. consumers receive at least one Amazon parcel a week.

With each sale of a physical product comes a shipping container and the materials associated with it. As ecommerce sales continue to increase, the impact on the environment will only continue to grow as well.

Why is Sustainability Important?

Sustainability means doing something in such a way as not to deplete natural resources and to support long-term, global ecological balance. Looked at another way, sustainability is often seen as balancing meeting the needs of the present without compromising the needs of future generations to meet theirs.

As a growing consensus of scientists points toward the harmful effects of consumerism and the potential dangers of climate change, it is essential for companies to heed their call and shift their business practices as necessary.

If that isn’t enough, consumers increasingly consider sustainability and environmental consciousness important. According to Statista, more than half of US and UK consumers want online brands to create products with less packaging, while a third of US consumers would be willing to pay a surcharge for eco-friendly delivery.

Most importantly? Per a Nielson report, 73% of shoppers would definitely or probably change their consumption habits to reduce their environmental impact.

For online retailers and ecommerce companies looking to make a change, consider the following benefits:

Environmental protection.

The environmental pillar often gets the most attention as companies focus on reducing their carbon footprints, waste from packaging and overall environmental impact.

Tracking and focusing on reducing environmental impact can have both a positive effect on the planet and a favorable financial impact as more consumers come to value the efforts being made.

Economic viability.

For a business to remain solvent, it must focus on its viability and profitability as a company.

That said, to be sustainable, profit cannot come at the expense of the other two pillars. Concerns under this pillar are whether or not the business stakeholders’ interests align with the company’s community, customers and values.

Social equity.

While this article will primarily focus on the environmental and economic pieces, the social pillar remains an essential aspect of sustainability. This includes operating in a way that benefits employees and the surrounding community according to the social license.

It also means paying attention to your entire supply chain and ensuring the people involved in creating your eco-friendly products are fairly treated and compensated.

Consumers are Demanding Sustainable Ecommerce

Sustainability is becoming a more significant initiative for many businesses. This is sometimes motivated by a genuine concern by business stakeholders to operate more sustainably and ethically.

However — in a beautiful synergy of the Environmental Pillar and Economic Pillar — sustainability is also becoming good financial sense because customers are clamoring for it.

Here are a few stats to consider:

• According to a Nielsen survey, 73% of global consumers say they would definitely change their consumption habits to reduce environmental impact.

• A survey of 6,000 consumers in North America, Europe, and Asia found that 72% of respondents reported actively buying more environmentally friendly products.

• Research by NYU’s Stern School of Business found that 50% of the growth in consumer packaged goods from 2013-2018 came from products marketed as sustainable.

• At 75% of respondents, Millennials are more likely than Baby Boomers to say that they are actively changing their habits to be more sustainable.

Consumers value these efforts and actively vote against sustainable products and companies with their wallets. As a business, if you can make a decision that will have a positive impact both economically and environmentally, why wouldn’t you make those changes?

Ecommerce Businesses are Already Going Sustainable

Whether big or small, brands are capitalizing on the call for more green initiatives and rolling out plans to make their businesses more sustainable.

For more prominent brands, these pledges come with great fanfare, but often these brands have the farthest to go to mitigate their enormous environmental impact. In some cases, these efforts are antithetical to the company’s business model.

Smaller and midmarket DTC brands are more poised to make sustainability a core part of their business model, which can help them differentiate from big box stores and ecommerce giants. They can make it a core part of their identity from the beginning or find it easier to make changes to pivot toward what their customers are demanding.

How to Make Your Ecommerce Business More Sustainable

Whether you start small or go all in, there are steps you can take to start making your business more sustainable, including the following:

Update your brand ethos.

Your brand ethos tells your customers who you are as a brand and what you value. A sustainable brand is one that has taken a clear stance on sustainability and has undertaken environmental or social practices to support that.

As a sustainable ecommerce business, your brand ethos should be reflected across your site and channels. It can be consistently conveyed through a strong statement on your website, blog posts, social media and all of your content and copy.

Implement sustainable shipping.

The demand for fast shipping options in ecommerce has never been higher. With 21.5 billion parcels shipped in the U.S. in 2021, the volume of items being shipped due to online shopping has a substantial environmental impact.

A good portion of this carbon footprint comes from the last mile of the shipping process when the package is moved from a fulfillment center to a home address, adding to vehicular pollution in residential areas.

There are many ways to reduce the impact of shipping, from using recyclable packaging and reducing the amount of packaging to printing labels using thermal printers to save ink. Investigating eco-friendly programs from major carriers like FedEX, UPS and USPS can lead to paperless invoicing and other green options.

Another way to make your eco-friendly shipping practices more sustainable is to cut down on returned merchandise, as being shipped both ways doubles the impact. Provide clear product descriptions and sizing information to ensure customers know what they’re getting.

Reduce packaging.

As anyone who has ever ordered from Amazon and received a canoe-sized box to house a new iPhone case knows, packaging waste is one of the dirty secrets of many ecommerce brands. According to data from First Insight, nearly half of people think Amazon shipments include excess packaging.

Making concrete efforts to reduce ecommerce packaging waste can significantly impact your business’s footprint. This can involve buying boxes in more sizes to fit smaller items better. Packages that are too large not only waste space but also require more packing material to protect items.

Lower your return rate.

With packaging to a customer already contributing negatively to sustainability, it is no small wonder that returns going the opposite way have a similar environmental impact. It is also a problem that is getting worse.

In 2021, retail returns jumped to 16.6%, a significant increase over 10.6% in 2020. Returns affect the bottom line for companies and can lead to increased packaging costs, waste and transportation emissions.

The goal for organizations should be to reduce returns as much as possible. The best way to accomplish this is by ensuring that all accompanying information about your products is correct, up-to-date and complete with whatever a customer may be looking for.

If the customer knows precisely what they are purchasing, the likelihood of returns should be minimized.

Create recycling policies.

In addition to sizing boxes and accompanying packaging to the size of the item being shipped, companies can also reduce waste by choosing sustainable packaging and eco-friendly packaging materials.

Here are some quick facts:

• 73% of Americans have access to curbside recycling, and 94% have access to some form of recycling.

• Recycling cardboard takes only 75% of the energy required to make new cardboard.

• One ton of recycled cardboard saves nine cubic yards of landfill space.

Using recyclable cardboard boxes and mailers — as well as making recycling easier for customers and businesses — can dramatically reduce the amount of waste they produce.

Reduce energy waste.

Sustainability can also go beyond your shipping practices and product makeup to general business practices, including how your offices and warehouses are run. Making simple changes such as turning off equipment when not in use, investing renewable energy and reducing the temperature in the office can significantly lower energy bills.

The first step in reducing energy waste in your business infrastructure is to do an energy audit to determine where cuts can be made. You can then start making changes based on what will be the easiest lift with the highest overall impact.

Add products that support sustainability.

Depending on what you already sell, one way to make sustainability a crucial part of your business is to include sustainability-focused products in your offerings, especially as a growing market of customers is interested in buying such products. This could mean providing more eco-friendly alternatives to existing products or that solve problems that allow people to live more sustainably.

By including products in your line that help people live more sustainably, you are opening up your business to a large customer base eager for such products.

Create an offset service charge at checkout.

One effective way to balance some of the associated environmental downsides accumulated from creating and purchasing your product is to buy carbon offsets.

Essentially offsets are measures designed to balance the amount of carbon dioxide produced by investing an equal amount in projects related to reducing greenhouse gas emissions.

Your business can make investments in offsets a part of your budget. However, you can also allow customers to help by providing online shoppers with an optional offset charge. Be sure to choose a reputable carbon offset project to disperse the funds raised

Consider an ecommerce marketplace to resell your used merchandise.

One final step that may be a good fit, depending on your industry, is to help your customers give your products a second life. Typically, products move from being created to being used and disposed of linearly. Efforts are being made to change this into what is known as the circular economy.

The circular economy involves giving products a second life by encouraging them to be passed on to a second or third owner after the first has gotten tired of them. Products can then be recycled to be created into new products.

Resale marketplaces and peer-to-peer networks that allow consumers to buy used products are growing in popularity, especially among Gen Z shoppers. You can encourage your customers to be part of the circular economy by providing opportunities to resell products or purchase recycled products.

The Final Word

Sustainability and the future of our planet is an issue that affects all of us as global citizens. Younger shoppers — particularly those who will inherit our future Earth — are starting to take a stand with their dollars.

By making efforts toward creating a more sustainable product, supply chain or shipping method, you may be able to have the dual wins of both creating a more sustainable future and helping to differentiate your brand in a sea of competitors.

FAQs About Sustainable Ecommerce