E-commerce is rapidly growing, due in large part to the COVID-19 pandemic and stay-at-home-orders. In 2020, e-commerce grew 32%—astronomical compared to an average annual growth of 15%. This extreme expansion comes at a hefty price to the environment. Each aspect of the e-commerce supply chain contributes to climate change and environmental degradation in one way or another. Being sustainable is not really an option anymore. But there is good news, by implementing sustainable practices you can boost your brand value, all while helping out the planet.
What does it mean to be sustainable?
Being a sustainable brand means a business is working to mitigate their impact on the environment through different initiatives that reduce things like carbon emissions, pollution, and excess waste. Sustainability is increasingly important as climate change is negatively impacting the world around us. Being sustainable and more environmentally conscious is also extremely important for your brand.
How being sustainable will boost your brand
Integrating sustainability into your business will increase your brand value in 5 key ways.
1. Align your brand with your customers’ values
Customers want sustainability, and they want the brands they shop from to help them be sustainable. Specifically, 88% of consumers want brands to help them be more environmentally-friendly.
Consumers are increasingly purpose-driving, meaning they are willing to pay a premium for products and services that align with their values. Purpose-driven consumers are also willing to change their shopping habits to reduce environmental impact and care about issues such as sustainability.
2. Create a competitive advantage
Sustainability is a great way to differentiate your products and business from competitors.
By integrating sustainable initiatives you can capture customers from your competitors who aren’t putting forth the effort to be more environmentally friendly. Consumers will boycott companies (your competitors) due to their stance on specific issues, moreover 66% of millennials say they have boycotted a company because of this reason.
These types of consumers will be loyal to the brand that supports and shares their values. If your competition isn’t doing much in the way of sustainability, this is a great opportunity for your brand to capitalize on eco-friendly initiatives and win new customers.
3. Cut costs
Oftentimes, sustainability gets a bad reputation for being expensive. However that is not always the case, especially in the long run. By optimizing your supply chain you can cut down on creating excess waste, and reduce the amount of raw materials you need. Look for ways to utilize byproducts and scraps to give them a second-life. While it can be a big investment upfront, switching to renewable energy like solar will reduce costs. There are Increasingly more regulations placed on businesses with regards to emissions and waste disposal – it’s easier to make changes and implement plans now and be ahead of the curve, rather than to wait until they are mandated and you have to play catch-up.
4. Increase your conversion rate
Customers want sustainability, we already know that, and it doesn’t take a massive overhaul of your business model to see the benefits of implementing sustainable practices. Brands like Nuzest and Tribe Kelley saw lifts in their cart conversion rates just from adding a carbon neutral option at checkout.
Both brands added EcoCart to their checkout flows to provide their customers with the option to make their orders carbon neutral when they checked out. As a result they experienced an average increase in cart conversion of 20%. Tools like EcoCart are a great way to easily further, or start, your sustainability initiatives, all while increasing brand value.
5. Appeal to new investors
One aspect of growing your brand is how you look to investors. Investors are growing more and more interested in sustainability as they are mirroring consumer sentiment about sustainability and sustainable brands. In fact, sustainable investment vehicles reached record highs in 2020, with over $51 billion in new investments, more than double the previous record set in 2019. Plus, last year on average sustainable funds outperformed conventional funds and indexes.
How to make your business more sustainable
Sustainability is not a one-size-fits-all approach. However, there are several actionable steps you can take while on your journey to more eco-friendly business practices.
Eco-friendly packaging and shipping
Packaging can be a main source of excess waste and non environmentally friendly practices.
Evaluate your current packaging and look for areas of improvement. There are a variety of compostable and made from recycled materials options for mailers and poly bags, shipping tape and labels, even biodegradable packing peanuts. Sustainable packaging sends a clear message to your customers and shows you are making efforts to be more eco-friendly. This will increase your brand image and make them have faith in your sustainability initiatives.
Consider changing up your shipping methods, and offer a slower shipping option. When it comes to the environment, slow > fast shipping. Expedited shipping means there are more less-full trucks being sent out, rather than fewer completely full trucks. As well, you can offer to bundle orders for customers who place more than one in a 24 or 48 hour window, reducing the amount of packages being sent to that customer.
Work with well-respected organizations
LEED-certified manufacturers to ensure your factories are up to your standards. All of these help customers take your sustainability claims more seriously and increase trust and their loyalty to you as they recognize these names.
Communicate your sustainable practices
All of your sustainability efforts won’t mean much to your customers if you don’t communicate to them effectively. It’s important to be transparent about what your sustainability practices are, and how you carry them out.
It’s important to leverage your website, social media, ads, and other external comms channels to clearly communicate your brand’s goals and plans for sustainability. By highlighting and documenting your approach and plans your customers can easily see and understand your different sustainability goals.
No matter how you decide to approach sustainability, make sure your initiatives are transparent and that you’re accessible to customers, especially those that want to learn more about your initiatives. Tone can help you do this through providing exceptional customer service to your customers via SMS. Whichever channel your customers choose to communicate with you on, respond quickly and effectively and you’ll see higher conversion, increased order size, and higher LTV.
Sustainability is the future of e-commerce, and it’s better to get in while you can. Consumers want to buy from eco-conscious brands and gravitate towards innovative eco-conscious products. If you want to capture those consumers you have to appeal to them and their values. Besides implementing eco-friendly practices, it’s imperative to communicate your initiatives to drive brand value. Starting on a sustainability journey can be daunting and overwhelming, learn more about how tools like EcoCart can boost your sustainability initiatives and your brand value.
Guest Author Bio
Peter Twomey is the co-founder and COO at EcoCart. Peter’s professional passion is building software solutions that solve problems he experienced-first hand in his time as an entrepreneur. In his free time, you can find Peter skateboarding around San Francisco and cleaning up the beach with his dog Butters.