“Online shopping produces up to 4x less carbon dioxide emissions versus traditional store shopping,” says Dr Heleen Buldeo Rai, a researcher at the Université Gustave Eiffel in Paris, who joined the panel of speakers at our annual Price Points Live event last month in Amsterdam. She shared her insights regarding sustainability and e-commerce. Over the last decade, many retailers and brands around the globe have been working towards a greener industry, with packaging, manufacturing and delivery being the top three cogs in the machine with the worst environmental impact. In this article, the third in a series where Omnia gives an in-depth look at what we learnt at Price Points Live, we will discuss what retail, both online and offline, can learn and do to improve their economic and environmental impact regarding packaging and delivery.
During Dr Buldeo Rai’s talk, she shared 10 insights based on studies and experiments conducted for the purpose of finding eco-friendly solutions to last mile delivery. Here are three that e-commerce players should take note of:
1. Consumers make the final choice
When it comes to choosing delivery options, it is the consumer that has the final choice, and not the retailer. According to Dr Buldeo Rai’s research, most consumers are not willing to pay for delivery, as the industry standard today is free delivery. However, they are willing to wait longer or to collect their purchase, as seen in the results of a study below. Dr Buldeo Rai surmises that after conducting this study in Belgium, similar results were seen in the Netherlands, Bolivia, China and Brazil, showing the global trend in delivery options.
The same consumers were asked the same question, however, the delivery time estimate was changed to 3 - 5 days, and the results were very similar. Choosing a slower delivery time/method has a significantly positive economic and environmental impact per parcel delivered, and as we see below, most consumers are still willing to wait a little longer. Retailers can use this information to motivate consumers to choose more eco-friendly delivery options.
2. “Did You Know?”
Consumers choose more environmentally friendly delivery options when they are informed. Dr Buldeo Rai and her team found through an experiment that 59% of online shoppers would opt for a slower delivery method if the web shop had a “did you know” information box sharing that if they are given more time to group parcels, the environmental impact of delivering this parcel will be lower.
3. Reusable bags are more environmentally friendly after a number of uses
The average parcel contains between 130 - 250 grams of padding and packing material, which alone has an impact on the environment and adds to the ever increasing levels of waste. However, retailers struggle to find a solution for this due to the fact that the average parcel journey includes 17 falls, and packages need to be cushioned, otherwise a consumer will expect a free return - which is another headache for retailers. One option is reusable bags, but this option will also need its own logistical process so that bags are actually being reused. Below, we see how using reusable bags (red line) decreased in their environmental impact per use, while single-use bags remained the most impactful.
Still in search for a solution to the dreaded last mile
“By 2025, about 30-50% of everything we buy will be done online. And so, it is time for us to look at ways to organise the e-commerce supply chain in a more sustainable way,” says Dr Rai. In a paper written by Dr Buldeo Rai, in collaboration with Sara Verlinde and Cathy Macharis, the idea that crowd logistics (also known as crowd shipping) could be an operationally cost effective and environmentally friendly alternative to traditional parcel deliveries is discussed and tested. However, contrary to previous research, Dr Buldeo Rai concludes that crowd logistics, as it currently stands, is not more sustainable than current delivery methods: “The impact on sustainability is dependent on several factors, including the crowd's modal choice and consolidation of parcels.” For example, if someone was delivering a parcel dedicated solely to delivering this one parcel, instead of on the way home or on the way to work (as the concept of crowd shipping intends), it would significantly increase the delivery’s environmental impact. The idea behind crowd shipping has potential, but the logistics need to be fine-tuned.
Watch Dr Buldeo Rai’s full keynote speech on sustainability in e-commerce here.
