3 Easy steps for Australian Retail to start their Sustainability journey

Australian Retailers can take a critical action to lay the foundation to become more sustainable organization and reduce their carbon footprint. However they need to understand the demand and commercials for their Sustainability focused products and how to communicate this to customers. There are 3 easy steps each retailer can take to start this journey

Incorporate sustainability into consumer research – Sustainability teams and Commercial Leadership need to start building a deeper understanding of consumer sentiment—how expectations will evolve and how high a premium shoppers would be willing to pay for sustainable products. Nine in 10 Australian consumers are more likely to purchase ethical and sustainable products according to new research by CouriersPlease, with the survey also revealing that 85 per cent of consumers want retailers and brands to be more transparent about the sustainability of their products.

Test green products - Design teams should get a head start on developing new product versions that explicitly use decarbonized materials and a lower-carbon supply chain, as well as directly testing the consumer uptake and pricing power of such products. Adidas for example recently launched the low carbon shoe in participation with Allbirds. The low carbon product line was created with 63% less emissions, measured against the comparable Adidas running shoe showcasing a new approach to design and an alternative method of manufacturing that drastically reduces carbon impact.

Create emissions transparency at a product level. Retailers should start tracking emissions profiles at a product or subcategory level to help prioritize efforts to decarbonize and enable customers to make sustainable choices. This approach would require action at two levels. First, retailers would have to partner with vendors and third-party emissions-tracking providers and form internal teams to create emissions databases. Second, they would need to invest in technology to make the emissions information readily available to customers. Carrefour, for example, is investing in blockchain technology to trace textile products across the life cycle. It can then allow consumers to use a QR code to see product-related information, such as place and date of production, the product’s composition, method of cotton cultivation, and environment-related certificates.

Despite the uncertainty around willingness to pay, an emerging view expects that the transition to a low-carbon economy will create new value pools and that demand for low-emissions products and services will continue to grow. Retailers need to understand these value pools and be on top of them.