A recent Manhattan Associates study has found that over 67 per cent of Australian consumers are influenced by green or sustainability issues when making retail purchases.
Retailers across all sectors are waking up to the importance of green issues with “doing more to minimise the environmental impact of our organisation” a top-four business priority among 31 per cent of Australian retail companies.
“Green issues have taken on greater importance in recent times with increasing concerns about carbon emissions, the backlash over single-use plastics, as well as community action against climate change and the loss of biodiversity,” said Raghav Sibal, Managing Director, ANZ, Manhattan Associates.
“Our research reveals that consumers increasingly have environmental sustainability on their shopping list, and retailers who can find a profitable way to satisfy this demand will win a significant advantage over their competitors,” Said Raghav.
The Manhattan Associates survey of 2,000 Australian consumers and 100 large-end retailers has revealed that over 67 per cent of Australian consumers state that green or sustainability issues influence their purchasing decisions.
The research shows retailers still have some way to go before matching the importance shoppers are placing on the same issue.
In retail, the rise of online shopping has led to large reductions in the carbon footprint of the consumer. However, the shift towards the globalisation of buying and receiving goods has created another sustainability issue entirely – the shipping, handling, and transportation of goods.
“Studies show that shoppers who complete their entire shopping journey online generate a 50 percent lower carbon footprint than traditional in-store buyers. However, while e-commerce can significantly reduce carbon emissions, there is still a large environmental issue at hand around the transportation of online-ordered goods,” said Raghav.
Manhattan Associates’ research highlighted a potential difference between what retailers perceive as consumer aspirations and reality when it comes to delivery.
Retailers revealed that they perceived same-day delivery to be their customers’ most popular delivery option, while only 8 per cent of consumers agreed with this. The most popular delivery option among 35 per cent of customers was actually delivery in 2+ working days.
“In the future, if consumers could see the impact that their fulfilment decisions make on the environment, it could influence their delivery choices. If consumers knew that selecting to receive an item in four days instead of one would result in a 70 per cent reduction in carbon impact through better grouping of orders to limit shipping runs, they could be more likely to make that choice,” said Raghav.
To ensure that goods have the shortest path to consumers, and the lowest emissions total possible, retailers must also consider hybrid fulfillment methods which include both shipping goods to customers from warehouses and from stores.
“Ship-from-store is vital in an age where e-commerce orders are booming and customers desire delivery methods that limit environmental impacts. For example, it makes little sense for a retailer to ship a large electronics item from their Melbourne-based warehouse to North Queensland, if that same item is already available in a retail store in large volumes in Cairns. The bottom line is that retailers need to be smarter with how they approach fulfilment in the future, so they are considering both the environmental impact of their operations and what customers really want.”