A new ‘Conscious Commerce’ report debunks the ‘sustainability premium’, revealing consumers and businesses remain committed to sustainable practices, such as carbon-neutral shipping, and being climate-conscious – despite the cost-of-living crisis and tightening budgets. These stats are crucial at a time when January temperatures in Europe reach an all-time high, and the UN warns global temperatures may exceed pre-industrial levels within five years.
The report from Shopify, a leading global commerce company, finds 62% of consumers across the globe won’t compromise on sustainability, even during economic uncertainty. This high level of consumer-consciousness provides a growing opportunity for businesses, with 82% of merchants surveyed globally (81% in the UK) telling us they believe sustainability and improved company performance are interlinked – in other words, sustainability is now intrinsic to company success.
“This report shows climate-consciousness is driving purchasing decisions, even in challenging economic times,” said Stacy Kauk, Head of Sustainability at Shopify. “For both business and the climate, it’s in everyone’s interest to implement practices like carbon-neutral shipping and support for emerging sustainability solutions. This needs to be a collaboration between merchants, buyers, and the broader commerce community.”
Consumers won’t budge on sustainability despite wallet squeeze
Globally, consumers are prioritising sustainable practices, with 54% (52% in the UK) already shopping sustainably, by, for instance, choosing retailers that offer carbon-neutral shipping. This is on the rise even though 38% of consumers (42% in the UK) revealed they are cautious about spending due to the rising cost-of-living. Mainland Europe is leading conscious shopping, along with the Netherlands, registering 60% and higher for consumers shopping sustainably – above the global average of 54%.
Reflecting the energy they’ve displayed in the climate movement – from school strikes to the rise of eco-friendly diets – younger generations are driving the conscious shopping revolution. 59% of Gen Z consumers globally, and 61% of millennials shop sustainably, with 31% of both age groups planning to be even more sustainable this year.
Consumers globally aren’t waiting around for retailers when it comes to climate-conscious shopping. They’re proactively changing their behaviours and seeking planet-positive options, such as finding products with recyclable or eco-friendly packaging (24%) and buying local (24%).
Businesses’ biggest barrier to sustainability is cost, although they recognise consumer demand
Some businesses reveal cost as the biggest barrier to being more sustainable – particularly larger companies, which may have more complex supply chain constraints. In fact, just 40% of businesses with 1 to 50 employees highlight it as a real obstacle, while a higher percentage (48%) of larger businesses (501-1,000 employees) do likewise.
Even though cost may be a barrier, especially while budgets are being squeezed, larger retailers with 501 to 1,000 staff are the most likely (46%) to see the current economic landscape as a chance to accelerate sustainability programs. Not only are climate-conscious retailers likely to receive increased consumer interest, they can also limit the impact on their bottom line in other ways.
Longer delivery times are a prime example of where lower costs and sustainability could go hand-in-hand. While 26% of businesses globally (23% in the UK) were concerned about meeting fast delivery expectations over the Black Friday Cyber Monday sales season, 60% of consumers revealed they were willing to wait longer for products to arrive from sustainable brands – rising to 62% in the UK.
Businesses are finding new ways to build sustainable options for their customers
Two popular sustainable options are in-store recycling (in the UK, 35% of retailers are offering this) and sustainability programs where a percentage of sales goes to non-profit (offered by 25% of UK retailers).
Georgie Williams, Head of Marketing highlights one initiative luxury fashion-brand Nadine Merabi has employed: “We’ve teamed up with HURR Collective, a rental service, on a mission to make fashion circular. The circular economy is restorative and regenerative, and aims to make buying no longer the default choice.”
Sustainable initiatives are welcomed by consumers, particularly as almost half (45%) globally say they are willing to pay an extra fee if it reduces their carbon footprint. To go further, retailers can leverage tools, such as Shopify’s Planet app which can be used to zero out shipping emissions. It does so by calculating the estimated shipping emissions from every order so merchants can remove these by funding the same carbon removal companies supported by Shopify. Planet has neutralised shipping emissions on more than 7 million orders with high-quality carbon removal, totalling more than 6,000 tonnes of carbon.
Businesses who are proactive and visible about their sustainable values will be rewarded with consumer loyalty. In fact, over a quarter (26%) of consumers globally say retailers can retain their loyalty during the cost-of-living crisis by sticking to their values.
See the full report here. And, for more information on how Shopify is achieving better commerce for a better planet, visit: https://www.shopify.com/
