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June 5, 2024
Should the Sustainability Benefits of In-Store Shopping Be Promoted?
A new university study finds that explicitly providing consumers with information on the environmental and social impact of home deliveries can help U.S. omnichannel retailers — or those with numerous stores — capture sizeable market share from Amazon while expanding margins.
“We found that many consumers are committed to making more sustainable choices, but more than 80% of them do not inherently consider or understand the adverse sustainability implications of having online purchases shipped directly to their homes,” researchers from the Sam M. Walton College of Business at the University of Arkansas and Texas Christian University’s Neeley School of Business wrote in a column in the Harvard Business Review.
The researchers added, “While focused on sustainable product characteristics, they are often unaware of the additional packaging wastes, energy usage, traffic congestion, or safety issues that home deliveries create.”
In their study, online shoppers were asked to choose between free home delivery or free store pickup. Within the control group — participants not given any sustainability information — nearly three out of four opted for the convenience of home delivery. In the treatment group, where “participants were shown that store pickup reduced packaging wastes, emissions, traffic congestion, and vehicle accidents relative to home delivery,” 60% chose store pickup.
Overall, including online sustainability labels was found to cause store pickup to more than double and home deliveries to drop by 43%.
The researchers “conservatively” estimated that omnichannel retailers could capture $100 billion worth of market share from Amazon by calling out the environmental and social costs of home deliveries. Operating costs also could be “significantly” reduced with the shift to more in-store pickup, given that the additional handling and movement requirements for home delivery represent almost 50% of retail logistics costs.
Finally, omnichannel retailers could significantly reduce their environmental impact. The researchers said that even if only half of the projected channel-shifting volume is achieved, retailers can reduce that amount of plastic packaging waste by 100 million pounds, the number of trees used for cardboard production by 200 million, and the amount of tonnage that goes into landfills by 6%. Carbon emissions are also expected to drop as the wide majority of consumers are expected to optimize rather than add to their existing weekly trips to stores.
On the social impact of e-commerce, the “stop-and-go nature” of home deliveries that creates traffic delays, noise pollution, and vehicle safety issues for local community members is expected to be sharply reduced with a shift to more in-store shopping.
The researchers concluded, “Achieving these benefits requires neither major investments in new equipment or technologies nor significant process changes. Rather, omnichannel retailers simply need to provide consumers with the sustainability information.”
A 2023 study, “Does Shopping Behavior Impact Sustainability?” conducted by Deloitte on behalf of Simon Property Group, found that mall shopping can be up to 60% more environmentally sustainable than online shopping. Among the factors cited in the study creating online’s comparative environmental toll were the higher rate of returns from online shopping and the required additional packaging (corrugated boxes, bubble wrap, etc.). The study also found that the average mall shopping group size is 2.2, and when people travel together and buy more products per trip, the average fuel burned to buy each product is lower.
Another study published last year by Carnegie Mellon University’s College of Engineering found that grocery delivery was less energy efficient than individual trips to the store, as most people stop to shop on their way home from work or at times that avoid peak traffic hours.
However, numerous other studies contend that online delivery may be more sustainable depending on the circumstances. Increasing scale and innovations also promise to reduce e-commerce’s environmental impact in the years ahead. One study from MIT found that online shopping could be more sustainable than traditional shopping in more than 75% of scenarios that researchers came up with. Scenarios imagined included all-electric shipping, online warehouses positioned closer to the end user, and reduced packaging.
Discussion Questions
Should retailers with a broad brick-and-mortar presence be promoting the sustainability benefits of in-store shopping?
Is there enough evidence that online shopping at this point has a worse environmental impact to make such claims?
Should stores overall be guiding customers toward more sustainable shopping practices regardless of purchasing channel?
Poll
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Keith Anderson
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Richard Hernandez
Merchant Director
Lisa Goller
B2B Content Strategist
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Quite honestly, sustainability does not move the dial much for most consumers – not enough to change habits, anyway. This doesn’t mean it’s not something people are not concerned about, but it comes way down the batting order when it comes to making choices about what to buy and where to shop. We see this all the time in the decisions that are made – from electing to use fast fashion platforms like Shein to the over-consumption of products. Even if people are made fully aware of the environmental costs of home delivery, it really isn’t going to change the bulk of behavior. And even though this study surveyed consumers, when it comes to subjects like sustainability, what people do and say in surveys is often not how they behave in real life.
I also challenge the assumption that online is always worse for sustainability than shopping in store. I think it very much depends on the circumstances and I think the full environmental impact of stores needs to be set against those of online. At the end of the day though: most customers simply do not care, and they are right not to. We can’t make every decision based off detailed environmental data. It is completely impractical.
You are right on, Neil. Even if the environmental impact of home delivery initially moves a shopper, how many trips to pick up the merchandise will they make before they tire of it and say, “Deliver it?” Convenience, convenience, convenience.
Whenever I read the results of any study, I always consider who conducted the research and who paid for it. As a 45-year marketing professional, I can purchase research to reach any conclusion I need. A researcher knows how to formulate the questions, and how to evaluate the responses, to influence the results.
Considering all those reasons, and considering the researcher, I sincerely doubt there would have been any non-biased conclusion that a significant number of consumer decisions would be influenced by information provided to consumers about the environmental and social impact of home deliveries, or any other environmental benefit.
Based on my own experience with consumers, I am not convinced that environmental factors influence the majority of consumers, especially if the choices make a difference in price or convenience.
In the first place, consumers are skeptical about environmental claims. They constantly hear or read that fewer than 5% of the waste they place in recycle bins is actually recycled. Additionally, they learn how environmental claims are commonly misrepresented.
Climate change claims, and threats associated with it that never materialize, are gaining skepticism. Currently, Gen Z and Millennial consumers claim to be very conscientious of sustainability, but point of purchase sales do not reflect that. Db
The studies cited feel like so much nuance-free navel-gazing. Of course sustainability is important to a growing number of consumers – that isn’t in question. Looking for marginal marketing angles only serves to create more noise that inevitably dilutes meaningful sustainability efforts. Any consumer who deeply cares about sustainability will do their own research. Deciding that shopping in stores solves a world of harm is an unlikely conclusion.
I believe in this economy (except maybe for the Whole Foods customer) sustainability has taken a backseat to more of a “Can I afford what I am buying?” mentality first and foremost.
Curiously, “it depends” wasn’t an option (as I would think that would be very much the case.) Anyone who’s ever found their bin filled with – flattened! – boxes knows online has an impact beyond hitting the “buy” button. But quantifying it, and making the comparison to physical shopping is problematic at best: there will be a host of assumptions, and how they go are likely to swing the advantage back and forth. I think it’s better to concentrate on benefits that are less disputable.
Sustainability matters, and we can all do our part. However, significant global disruptions, relentless inflation, rising costs of living, and geopolitical and economic uncertainty have had a meaningful impact on the rise of conscious consumerism. There was a brief moment before the pandemic when brands were scrambling to meet the needs of conscious consumers, and DTC unicorns such as Allbirds were there to meet the surging demand.
As we have witnessed over the past few years, sustainability, no matter how unfortunate, has taken a back seat and is rarely part of most customers’ discovery and shopping journeys. Additionally, the drastic dichotomy of the extreme fast fashion offered by SHEIN, Temu, Zara, H&M, and the high-end luxury provided by the LVMH Maisons and other luxury brands where sustainable practices are more common demonstrate how consumers are gravitating to affordability vs conscious consumerism,
Let’s put the environmental impact of the fashion industry into perspective with these staggering facts:
A few thoughts:
There are many consumers that wear shirts and buttons that emphasize their love of nature and promoting green practices, while they shop online frequently or go to numerous stores for one or two unnecessary items. More trips, but bringing a reusable bag. More deliveries, but recycling the cardboard. But they have the right to separate their voice from their wallet. Bottom line, retailers should highlight their sustainability practices, and encourage sustainability habits with their consumers. But it’s a slippery slope, since if we really want to emphasize sustainability, we need to have consumers shop and buy less, period.
When I walk into a store or, worse, a mall, and the air conditioning is so high that it is unbearable, is that cost considered in the environmental impact? What is the environmental impact of 30 or more customers driving to a store versus a delivery vehicle following a fuel-minimizing route to make 30 deliveries? And while there is no longer almost any plastic packaging in deliveries we get, how many plastic bags are handed out by retailers? Is the environmental impact of delivering merchandise to the store considered?
The article points out that some studies show shopping in-store is more sustainable, while others have found shopping online is more sustainable. Which is it?
Certainly, brick and mortar retailers pointing out the benefits of in-store shopping can’t hurt, but ultimately this is a decision that needs to be made by the consumer and their immediate needs.
There’s preaching and then there’s practicing. Do people actually behave (practice) in the exact manner that they respond to surveys (preach)…??? Some do and I’ll bet many don’t. I personally blame the word “free”. “Free” attached to delivery and returns makes so many other considerations ignorable. But of course deliveries and returns are never free…not even close. So if we could remove “free” from this conversation and actually charge just breakeven costs for delivery and returns, I think we’d have a whole different set of behaviors. That calculation is, of course, almost impossible in a literal sense. Retailers may know their logistics and materials costs, but the environmental costs are a lot more difficult to capture.
Limited time + maximum convenience + “free” = DELIVERY. Drop “sustainability” into that equation and I suspect that it becomes “delivery” for some people, but not a majority. And it won’t, until some effort is made to determine and charge for real costs.
Yes, yes and yes. Brick and Mortar retailers should ABSOLUTELY point out the sustainability differences between home delivery and in store purchases…I would, for example hammer home the fact that you have all of these boxes being flown everywhere, and then (allegedly) recycled–assuming of course the recipient recycles them.
This is a competitive differentiator and retailers should point it out. Loudly.
Sharing the sustainability benefits of in-store shopping helps consumers make informed choices. Multi-store retail chains show social responsibility leadership when they educate shoppers about their omnichannel options and their impact.
I think sustainable aspect of in store shopping should Definitely be highlighted and emphasized by ANY brick and mortar retailer. It IS Difficult though to fight the convenience and comfort of home delivery.
Just make the in-store experience better. Have the inventory, have the workforce to support the shopper and purchase, make it a positive human experience, give some incentive. You won’t win people over with a sustainability benefit story… speed and convenience outweighs good intentions in the best of us. And I say that as someone who cares about our shared environment.
There’s compelling evidence that in-store shopping can be more environmentally friendly due to reduced packaging and fewer emissions. Studies, like the one from the University of Arkansas, show that informing customers about these benefits can shift behavior significantly. However, online shopping can also be more sustainable in some cases, especially with innovations like electric delivery vehicles and optimized logistics. Therefore, stores should guide customers toward sustainable practices in both channels.
For example, encouraging store pickup for online orders can reduce environmental impact. Overall, promoting sustainability should be a priority for retailers, helping customers make eco-friendly choices regardless of how they shop. Moreover, in-store shopping reduces the possibility of returns as customer inspect their items physically before purchasing. Ultimately, lesser returns would mean that lesser products will end up in a landfill.