The e-commerce sector keeps expanding year after year. This growth leads to more deliveries. People who work in retail should know that backing brands that care for the environment now plays a significant role in what customers buy. Younger shoppers focus more on making everything sustainable to create a world that lasts.
As online businesses grow, buyers get new perks like quick deliveries and easy returns. Companies that offer top-notch services while being green are popular with shoppers. At the same time, people pay more attention to sustainability and want eco-friendly products and packaging.
We’ll show you 7 practical ways e-commerce firms can reduce their carbon footprint and help the environment.
A Few Key Shopping Trends
- Companies promoting sustainability in their products have growth and adoption rates almost 5.6 times better than those that do not.
- Gen Z purchasers have the consideration of the carbon footprint when they buy or seek to buy something.
- More consumers are buying into those brands that endorse sustainable practices and integrate them into their consumers’ purchase behaviors.
- Consumers desire to pursue a path that leads to a sustainable lifestyle. However, to achieve this lifestyle, they require assistance from brands.
The increase in greenhouse gas (GHG) emissions from the e-commerce sector necessitates a greener solution as consumers change to more sustainable buying practices.
Taking a sustainable strategy benefits brands in a variety of ways, including developing a corporate reputation in the market and being prepared for the ever-increasing number of climate action requirements. Furthermore, such data contribute to the development of a competitive and appealing brand image, which aids in attracting certain consumers and staff.
Let’s look at the carbon footprint of e-commerce and the steps your firm can take to become carbon neutral.
1. Adopt Sustainable Practices Across Business Operations
Sustainability doesn’t stop at packaging. Businesses must examine their entire operations, including warehouse and office management. Even e-commerce brands can’t ignore electricity use in warehouses or fulfillment centers, as these areas play a key role in overall sustainability efforts.
The approach is straightforward: turn off unused machines, install energy-efficient lighting and lower office temperatures. Also, switching to renewable energy sources is crucial to embrace sustainability. This strategy creates a positive outcome by cutting emissions and reducing power consumption, which can lead to lower energy costs.
2. Shrink Your Packaging and Make It Greener
Ever got a huge box with tiny items inside and the rest crammed with filler? Sellers often ship stuff in big boxes with tons of space, which they stuff with useless junk. However, sending products in small packages helps cut down on waste materials that end up in the trash. It also makes life easier for shipping companies to handle.
This approach makes the package more eco-friendly. By thinking this way about packaging, businesses can cut their carbon footprint by 30%, which is a big deal for companies. Another thing online shops can do is use recycled paper and other materials for packing and shipping instead of plastic bags and non-biodegradable stuff.
Paying attention to packaging puts your company on the right path to becoming eco-friendly. For example, Arka offers custom-made sustainable packaging for online businesses. Using recycled packaging like this is another way to meet your green goals without breaking the bank.
3. Client Returns – How To Minimize Them
Reports suggest that people tend to purchase many items when a return by post service is complimentary. So, if the companies stop offering free returns, people have to think through their purchases and the additional items they intend to purchase and return.
Therefore, e-commerce companies also have to incorporate detailed descriptors, good images and videos as well as weight charts. This will help the customers choose the best product to satisfy their needs. Other technologies, such as augmented reality or virtual reality, can also be used by companies to allow online shoppers to try out the clothes before they buy them. Moreover, the organization has to develop reasonable, although firm, return policies, such as when every customer receives a note encouraging him to ship back the product in a box.
4. Compensate for Emissions that are Bound to Occur
Carbon trading systems emerge with the concern of reducing emissions. You can perform carbon offset actions by participating or investing in effective climate change actions such as the preservation of rainforest projects or other global warming mitigation projects that entail renewable energy.
Carbon offset projects do not differ from emission reduction projects and are about finding a way to offset the emissions created by your organization.
The leading emissions in e-commerce are delivery and the packaging of the product itself. By focusing on these two elementary aspects, companies can eliminate these emissions and carbon offsets. If you wish to include carbon offset as one of the climate strategies for your firm, you will most probably have to engage in various ongoing projects that have been accredited to meet global requirements.
5. Personalized Marketing Communication
Marketing messages can be disseminated through marketing communication channels, such as traditional or digital media, in order to reach a bigger audience and convey the company’s message. Each of these has its risks and rewards; however, if it were to be compared with other strategies, digital marketing is the best strategy when it comes to sustainability. It is common knowledge that using online media or marketing tools can cut down the amount of resources used in producing traditional marketing media such as dirt flyers or print advertisements.
Marketing through conventional means, which does not consider the target market’s personality, is highly likely to reach a greater audience than sending direct mail. Non-personalized messages tend to focus less on the value offerings of brands to specific consumers making an adverse contribution to purchase decisions. The emergence of modern customer data platforms also allows businesses to target any e-commerce customer with hyper-personalized messages based on their every single purchase behavior.
For this reason, one-to-one hypercommunication is touted as the more effective marketing strategy compared to multimedia marketing ads. In other words, in the era of personalized marketing, consumers are more likely to see your brand if you employ personalized messages.
6. Adjust Vehicle Routes and Negotiate Electric Vehicle Last-Mile Deliveries
E-commerce companies must minimize the environmental impacts of their operations by planning efficient delivery routes and using electric vehicles for the last leg of the cargo delivery process. The application of AI systems for route optimization decreases the amount of fuel spent because they will always look for the shortest route. Besides, there is a need to acquire or make substantial investments in electric delivery vans or join hands with logistic companies that are able to minimize shipping-related environmental hazards.
7. Create a Circular Economy in E-Commerce
In addition to regulatory compliance, a transition to a circular economy can be a way for e-commerce companies to manage their waste and diminish resource depletion. This is achieved by creating goods with features such as durability, repairability, and unequivocal end-of-life options.
Companies can have a division within them for repairing goods sold, a division for returning goods bought back, or external partnerships with companies that recycle waste and ensure appropriate end-of-life use of the products. This reduces the impact on the environment, creates sweeping additional perspectives of earnings in business, and improves client retention.
Help Increase Carbon Transparency by Identifying Your Key Emission Influencers
You will be able to control the things that are manageable. So, they include the construction of carbon transparency and determining your company’s carbon footprint, which is vital in enhancing the green functions of the business. Many programs help to calculate the burning factors of emission in your zoning e-commerce business, logistics being one of them. Understanding your company’s real carbon input makes it practical to develop and take actionable steps that will lastingly mitigate emissions.
Much like how financial institutions use credit score ranges to assess risk, e-commerce businesses can develop sustainability score ranges to evaluate their environmental impact. These ranges could categorize companies from “high carbon footprint” to “carbon neutral,” providing a clear metric for improvement and transparency.
E-commerce business owners need to understand which strategies would enable moving the company faster to some degree of sustainability and let the customers understand the steps being taken in their direction. One of the most commitment and customer accountability ways is by placing any sustainability badges that you have on your content publishing site. Also, if you do not take the necessary steps toward any business greening, you will likely be subjected to a huge carbon or CO2 tax. The benefits of such choices are obvious as they will not only help the environment but will, in turn, reduce your costs and exposure to risks.
What Is EcomBalance?
EcomBalance is a monthly bookkeeping service specialized for eCommerce companies selling on Amazon, Shopify, Ebay, Etsy, WooCommerce, & other eCommerce channels.
We take monthly bookkeeping off your plate and deliver you your financial statements by the 15th or 20th of each month.
You’ll have your Profit and Loss Statement, Balance Sheet, and Cash Flow Statement ready for analysis each month so you and your business partners can make better business decisions.
Interested in learning more? Schedule a call with our CEO, Nathan Hirsch.
And here’s some free resources:
- Monthly Finance Meeting Agenda
- 9 Steps to Master Your Ecommerce Bookkeeping Checklist
- The Ultimate Guide on Finding an Ecommerce Virtual Bookkeeping Service
- What Is a Profit and Loss Statement?
- How to Read & Interpret a Cash Flow Statement
- How to Read a Balance Sheet & Truly Understand It
Conclusion
Efforts are being made to reduce pollution by implementing new policies. Still, as the environmental taxes increase, it will become problematic for new or small businesses to incur extra percentage costs on every purchase. So, the future of e-commerce is green only if you try making self-sustainable choices now and apply those changing values to the inner structure of your company. However, you need to think comprehensively about the whole product life, from the creation stage to the logistics and end product, and capture sustainable practices.