With unprecedented heatwaves knocking major cities to their knees, wildfires raging across Canada and other countries, and severe weather events disrupting the lives of millions of people around the world, it’s hard not to be concerned about climate change and the environment.
Consumers, retailers, and logistics providers alike are seeking ways to reduce their environmental impact, opting to implement sustainable habits, practices, and technologies both in their daily lives and in business operations such as sustainable home delivery.
Sustainability: What Do Consumers Want?
Today’s consumers are looking to manufacturers and retailers to provide sustainable goods and services, whether that’s products designed with carbon reduction in mind and manufactured with responsibly-sourced materials and recyclable packaging or delivery options that limit carbon footprint through low-emission vehicles and more eco-efficient routes and schedules.
The second annual Descartes benchmark study of 8,000 consumers across Canada, the U.S. and Europe offers insight into the importance of sustainability and the environment in consumer purchase and delivery decisions. Based on the results of the 500 Canadian consumers surveyed, more than half (52%) of respondents indicated that helping the environment is quite/very important to them, with 38% of respondents regularly or always making purchase decisions based on the product or company’s environmental impact.
The study also revealed that Canadian consumers are willing to buy more from companies that measurably demonstrate their supply chain is more sustainable than the competition, especially for groceries (45% of consumers) and clothing and footwear (43%); supply chain sustainability also factored significantly into purchases decisions for health and beauty (33%), restaurant food (33%), and furniture (31%).
On the last mile front, sustainable delivery is moving into the spotlight as consumer interest in mitigating environmental impact continues to grow. Indeed, 60% of respondents felt that the use of electric delivery vehicles will be quite/very important five years down the road vs. 29% who agreed today. Similarly, 56% of consumers thought a retailer’s ability to publish the carbon footprint of individual deliveries will be quite/very important in five years, compared to 30% who valued this ability today.
Moving forward, retailers need to prioritize the environmental impact of their delivery practices to reflect the rising consumer interest in using more eco-friendly sustainable home delivery methods, including:
- 100% carbon-neutral delivery services (55% of respondents)
- Combining multiple orders into a single delivery at the end of the week (55%)
- Seller recommending most eco-friendly delivery option, e.g., green delivery slots (50%)
- Combining multiple orders into a single delivery when there are multiple deliveries in buyer’s geographic area (50%)
- Picking up order at store (47%) or collecting at drop box facility (33%)
- Seller rating the environmental impact of all delivery options (44%)
- Slowing down deliveries to reduce environmental impact (37%)
- Paying higher price for the product or delivery (18%)
These consumer sentiment trends underline the importance and value in heeding the shift in buyers’ attitudes towards reducing environmental impact to improve the health of the planet. Notably, while interest in sustainable delivery practices is high, retailers need to step up their game in this arena; only 8% of Canadian consumers felt all retailers were doing a good job using sustainable delivery practices, with 47% of respondents acknowledging “some retailers” were doing a good job.
For those companies not meeting consumers’ expectations of environmentally-friendly delivery, the consequences are high. In response to poor environmental delivery practices, many consumers, especially younger buyers, take adverse action against the offending retailer.
This disruptive action can take the form of refusing to buy from the retailer again (26% of respondents)—rising to 34% for consumers aged between 18 and 34 years—telling friends and family to avoid the company (23% average vs. 33% for 18-34-year-olds), posting negative reviews (16%) or rebuking the retailer on social media (13%)—an especially dangerous possibility for a brand given the power of social media influence.
Convenience vs. Sustainability
Which benefit is more important to consumers: delivery convenience or sustainable delivery that minimizes environmental impact? The answer is not as black and white as many retailers may believe.
Thirty-three percent of respondents would think twice about ordering groceries online due to concerns about the environmental impact, while 55% of Canadian consumers said they would regularly purchase and pick up groceries locally at a slightly higher price (vs. buying them online for a lower price and having them delivered) if they thought it would help the environment.
Yet two-thirds (67%) of respondents chose to have their online purchases delivered to their home, compared with only 22% who picked up their items in-store and 11% who favoured click-and-collect. In fact, the 2023 study found that the majority (39%) of consumers felt that convenience and environmental impact were on equal footing with respect to influencing their delivery decisions.
The good news for retailers and consumers alike is that convenience doesn’t need to come at the cost of sustainability where delivery practices are concerned; the convenient choice can also be the sustainable choice. By combining multiple orders into a single delivery or offering eco-friendly time window options that are tighter but also increase delivery density, you can satisfy consumer expectations of convenience while simultaneously improving delivery efficiency to reduce environmental impact and cut delivery costs.
Sustainable Delivery Protects Margins
While retailers may hold the misconception that sustainable delivery processes are strictly a cost center, offering environmentally-friendly options to your customers can actually save your business money by reducing distance travelled and minimizing operational costs.
For instance, if you’re doing a delivery in one location on Wednesday at 10:00am and you offer a neighbouring customer the “sustainable delivery” choice of the 11:00 slot—perhaps at a lower delivery rate—it cuts your delivery distance from miles down to potentially a matter of feet, helping to reduce your transportation costs and boost delivery productivity. And the customer benefits by decreasing their environmental footprint and keeping their shipping costs in check.
Amazon, for example, has recognized growing consumer interest in reducing environmental impact and is using sustainable delivery practices to drive bottom-line benefits through its Amazon Day delivery option. Under the guise of offering consumers the predictability, convenience, and sustainability of having their orders delivered on the same day, Amazon is leveraging delivery consolidation to significantly reduce its transportation costs, eliminating multiple trips and decreasing miles driven.
By honing your home delivery strategies, tactics, and technologies to reduce environmental impact, you can meet consumers’ sustainability expectations while simultaneously curtailing delivery costs and increasing delivery efficiency and productivity.
Moving forward, retailers should stop viewing sustainable home delivery practices as an operational burden but rather an opportunity to help differentiate the business to drive revenue, promote brand loyalty, and increase profitability.