retail recovery
TRANSCRIPT
RETAIL RECOVERY Why sustainability holds the key
Retail recovery – Why sustainability holds the key 2
The impact of the pandemic on the retail industry has been phenomenal, with the sector reporting record sales declines as lockdowns prevented consumers purchasing in person.
However, if nothing else, the enforced pause in normal business operations has afforded retailers an opportunity to take stock of how they do things and identify improvements.
At the same time, consumers have used the moment to reassess what’s important to them, which has not only seen them change their buying habits but fundamentally how they live.
INTRODUCTION
Approaching an inevitable recovery period, retailers will need to marry the two – their business objectives with the rise of the conscious consumer – to create a sustainability strategy which both meets expectations and gives them a competitive edge.
In this guide, we’ll look at how recent events have put sustainability back in the spotlight, and where your retail business can implement greener marketing practices moving forward. The success of your brand could depend on it.
Retail recovery – Why sustainability holds the key 3
Some retailers – particularly non-essential ones – have seen their existence threatened by the crisis. So, it’s not a surprise that sustainability has slipped down the agenda somewhat.
Only 30% of professionals said their company was continuing to invest in sustainability during the pandemic.
Some of the backwards steps were arguably enforced on retailers by the virus. For instance, increasing the supply of hand sanitiser in plastic bottles for health reasons, with little regard for plastic-free alternatives or refills. In addition, the introduction of plastic screens at till or service points, many of which aren’t or can’t be recycled.
However, there is a recognition that it must become a priority once again. According to research commissioned by the Carbon Trust, 74% of businesses said their environmental and/or sustainability priorities are likely to change as a result of the crisis. Meanwhile, 63% said their sustainability budgets would increase in its aftermath.
This swing back towards greener practices can’t come soon enough as far as both consumers and the environment are concerned. And by partnering with the right supplier it can be delivered cost effectively too.
THE SUSTAINABILITY SEE-SAW
of professionals said their company was continuing to invest in sustainability
during the pandemic (Edie)
30%
of consumers said their sustainability budgets would increase in its
aftermath (Carbon Trust)
63%
of businesses said their environmental and/or
sustainability priorities are likely to change as a result of the crisis (Carbon Trust)
74%
Retail recovery – Why sustainability holds the key 4
of adults globally agree that, in the long term, the climate crisis is as serious as the COVID-19 pandemic (Ipsos)
71%Consumer pressure Global pressure
In the race to be ‘seen as green’, some businesses are guilty of making claims about their eco-friendliness that they can’t evidence. This is known as ‘greenwashing’, and companies are now starting to be held to account.
of companies exaggerate sustainability credentials (European Commission)
42%Committing to sustainability
of consumers consider the use of sustainable materials to be an important purchasing factor (McKinsey)
67%
of consumers have made significant changes to their lifestyles to lessen their environmental impact (McKinsey)
57%
The EU, Japan and the Republic of Korea, as well as more than 110 other countries, have pledged carbon neutrality by 2050 (The UN)
The Paris Agreement limits warming to 1.5°C above pre-industrial levels (The UN)
1.5°C
of businesses are embedding the UN’s Sustainable Development Goals in their core business (The UN)
46%
Retail recovery – Why sustainability holds the key 5
GREATER TRANSPARENCY THROUGH ESG
To avoid accusations of greenwashing within your business, level-up your policies with tangible, measurable ESG propositions.
Greenwashing runs the risk of losing customers, investment and value. Corporate Social Responsibility (CSR) policies have long been considered the best way to hold a brand to account. But in an increasingly complex landscape, the latest iteration of Environmental, Social, and Governance (ESG) provides retailers with a next level framework for greater transparency and measurable criteria.
What’s more, ESG allows investors, employees and consumers to align their investment of time and money with their values, helping to:
(McKinsey)
Facilitate top-line growth
Reduce costs
Minimise regulatory and legal interventions
Increase employee productivity
Optimise investment and capital expenditures
Retail recovery – Why sustainability holds the key 6
1 Examine your supply chains
Whether it’s your product or marketing supply chains, take a long, hard look at them to understand their original sources and verify a partner’s green credentials.
The right suppliers will ensure that not only the materials used throughout are sustainable, but that the processes used and communicated also deliver this. Sustainability should be a consideration right from the start, at concept stage through to consumption and disposal.
Choose suppliers prepared to align with your values, goals and commitment to sustainability. Ensuring that they adhere to global standards such as ISO 14001 or are audited by organisations such as EcoVadis, is a good way of giving you the confidence that this is being fulfilled.
Suppliers that adhere to these same values and commitments should have the knowledge and expertise in their field to identify and deliver your products and processes in a more sustainable way. They will have access to the resources needed to source sustainable virgin materials, deliver sustainable packaging solutions, follow more efficient production/ printing processes, create environmentally friendly finishes, and more.
TIPS FOR MORE SUSTAINABLE RETAIL PRACTICES
When it comes to devising an ESG proposition, it pays to be specific for two reasons: clearly defined initiatives are easier to measure internally, whilst being easier to communicate to your consumers. If they are too broad or too great in scope, both of those elements become more difficult.
As a retailer, there is plenty of opportunity to be more sustainable – whether it’s by looking at how your products and services are designed, packaged and marketed, or the processes and practices your business and suppliers follow. It’s also important to know this can be delivered to all manner of budget; it’s about having access to the right knowledge and expertise.
Here are four suggested areas to look at:
Choose suppliers prepared to align with your values, goals and
commitment to sustainability.
Retail recovery – Why sustainability holds the key 7
❱ Swap plastic-based product displays for semi-perm or permanent alternatives made from materials such as wood or aluminium. These stand the test of time and reduce landfill waste, but also save money in the long-term.
❱ Semi-perm/ permanent display structures still require an element of campaign changeability, but using sustainable virgin materials and processes for campaign panels/ signage allows for recyclability.
❱ Consider the entire lifecycle of your POS materials, repurposing them where possible – e.g. storing seasonal materials rather than making new every time.
❱ Include greenery throughout your store, which increases aesthetic values and changes the perception of the space, but also improves air quality at the POS.
❱ Install efficient lighting to cut costs while optimising energy use.
2 Get creative with your point of sale
Some consumers make their mind up about your sustainability credentials based on your point of sale (POS) – especially if they are early in their engagement with you as a retailer.
Your POS is the way you present your product and brand values. So, it should also communicate your commitment to sustainability so that you make the right first impression on the conscious consumer:
Install efficient lighting to cut costs while optimising energy use
Retail recovery – Why sustainability holds the key 8
4 Operate as one organisation
With many businesses spread across multiple locations (and even countries), simply working together as a sole organisation – with regards to marketing procurement – can have many benefits. Not only does it deliver cost efficiencies through economies of scale, it can also cut the frequency, cost and emissions from production and haulage.
A central, marketing technology platform is key in harmonising activity and enabling collective purchasing. The right solution can provide total transparency and visibility, ensuring full campaign planning, management and project tracking, delivering real-time savings.
Collaboration between different business divisions is key and starts with your culture. All too often, different business units have their own ideas of what sustainability is and how it should be managed. Sustainability should be integrated into the core of your company’s culture: its strategy, people management and practices. This will cultivate a singular sustainability view and ensure all the tips we’ve highlighted are supported.
Retail recovery – Why sustainability holds the key 9
CONCLUSION
The World Economic Forum has urged everyone to play a part in “laying the foundation for a green, circular economy that is anchored in nature-based solutions and geared toward the public good”.
But, for retailers – with a commercial bounce-back in mind – it’s arguably growing consumer pressure to protect the environment which will prompt them into action.
This time round, however, consumers won’t settle for token efforts. They want real change. That takes real commitment to the cause – but with it come benefits beyond merely doing right by your customers, including increased revenues and lower costs.
Partnerships will be key in how successful retailers are in their sustainability efforts. Your business relies upon others to be upholding the standards you expect of them. So, you need to run the rule on your supply chain, in addition to ensuring that the business decisions you make internally are driven by sustainability. Tapping into this expertise will also mean whatever your available budget you’ll be able to make the right steps towards becoming more sustainable.
There have been calls from all corners for the economy to ‘build back better’ with sustainability at the forefront.
Growing consumer pressure to protect the environment will prompt retailers into action.
GET IN TOUCH: +44 (0)1256 631 600
adareinternational.net
At Adare, we’re committed to working with partners that recognise the importance of strong quality, environmental and ethical practices in the workplace.
We operate a stringent pre-qualification process to ensure all suppliers meet and adhere to Adare’s requirements, and our EcoVadis GOLD Advanced rating puts us in the top 1% of companies of our type.
So, as you go about executing your marketing campaigns, you can rest assured that all the materials which go into it are sourced in an ethical and fully compliant way whatever your budget. That’s a strong place to start for any ESG proposition.
PARTNER WITH ADARE