3 ways that technology can make retail more sustainable

Like many industries, the retail sector must acknowledge an area in which it’s lacking – sustainability

Every year, UK retailers alone contribute some 215,000kg of CO2 equivalent emissions through the lifecycle of the goods they sell. This places them among the greatest emitters of greenhouse gases in the country, contributing some 80% more than all road transport combined.

As climate concerns intensify, consumers are demanding change. More than three-quarters of British grocery shoppers have boycotted certain products based on a brand’s environmental standards, while seven out of ten Millennials and Gen Z say they would pay more for ecological and sustainable offerings.

Can retailers rise to the challenge of environmentalism and satisfy this growing green sentiment? Yes — and technology is at the heart of the solutions. Here are three ways that technology can make the retail sector more sustainable.

1. Technology can help us understand the environmental impact of our purchases

Retailer-customer synergy is crucial if sustainability goals are to be realised. To this end, we need to help shoppers understand the environmental implications of their purchases.

Advanced point-of-sale systems can provide data-driven insights into customer behaviour. The re-use of plastic bags, for instance, can be monitored at checkout, offering rewards to eco-minded shoppers who remember to bring their own.

Danish grocery chain COOP DK is leading the way with this sort of intelligent personalisation. Rolled out in 2020, the supermarket’s smartphone app lets shoppers see the carbon footprint of their basket (and how it compares with the average). The goal is to nudge consumers away from the most carbon-intensive products — like meat and dairy — and towards more sustainable options.

Looking to the future, blockchain-enabled solutions and IoT sensors promise to take this further, offering customers real-time insights into their cart’s carbon footprint right across its supply chain. This level of eco-transparency is advantageous not only for the shopper, who is empowered to make more sustainable choices, but also for the retailer, which can demonstrate quantifiable climate action.

2. Technology can optimise supply chains

When a business decides to go green, cleaning up its in-house operations is an obvious starting point. But if its supply chain doesn’t follow suit, that hard work will have been for nothing. Recent Harvard Business Review research highlighted a litany of unsustainable supply chains issues, including non- existent green management systems and high staff turnover. To combat these complaints, more retailers are embracing supply chain digitisation.

Data-driven dashboards can pull together metrics from every stage of a product’s journey and highlight eco-issues along the way, guaranteeing an item’s environmental provenance by the time it reaches the buyer. Fashion retailer Tommy Hilfiger is one of many firms decarbonising supply chains with technological innovation. Using 3D design software, the brand now develops 100% of its seasonal lines virtually, with no physical garments made prior to launch.

There is, of course, still a requirement for large scale production when items are ready for market. This presents a challenge for retailers — the need to buy enough so shelves aren’t empty, but not so much that waste is inevitable. Again, technology can help. Smart, cloud-based warehouse management systems maximise storage capacity by using machine learning to optimise layouts. This increases energy efficiency, cuts down on wasted space, and helps retailers procure the right amount of stock.

3. Technology can be designed more intelligently to reduce digital emissions

Environmental costs aren’t limited to physical retail processes. Every time an e-commerce site is visited, electricity is used to power data centres, transmission networks, and consumer devices. With the e-commerce sector’s meteoric rise — online sales have almost quintupled globally since 2014 — ‘digital emissions’ are a growing concern.

On average, websites produce 1.76 grams of CO2 per page view. For sites with 10,000 monthly page views, that means 211kg of CO2 each year. In the US and the UK, fashion retailers Victoria’s Secret and UNIQLO are among the most carbon-intensive websites, with around six grams of CO2 emitted per visit. On the flipside, the likes of H&M and Marks & Spencer rank highly, producing just a fraction of a gram with every click.

Intelligent digital design is the secret to website sustainability. This means clever use of compressed images, efficient file formats, lightweight fonts and page frameworks, and offering ‘dark mode’.

Going green doesn’t need to be difficult

Retailers know the importance of sustainability, but they need the tools to properly channel their green ambitions. Optimising customer experiences, refining supply chains, and reducing digital emissions — these can all be achieved with the right expertise and the right partnerships.

It’s about understanding the changes that need to be made: how people, ideas, and new technologies can be brought together to deliver the most sustainable results. For customers and companies — and, indeed, the planet as a whole — that’s something worth striving for.

About the Author

Melissa Minkow, Director, Retail Strategy at digital consultancy CI&T. Melissa leads the retail division at CI&T, helping brands optimise the supply chain, e-commerce process, app design and point of sale experiences. She helps retailers to craft innovative digital strategies and adopt modern technologies that resonate with consumer shopping behaviours, driving brand engagement and retention. Previously, Melissa was an analyst at Gartner for over five years, identifying early shifts in consumer mindsets to advise brands on new purchase patterns and suggest new strategies. 

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