Business

Claire Aiken: A sustainable lens is the new mantra for retail

A recent report by Capgemini found consumer preference for in-store shopping has now surpassed pre-pandemic levels.
Claire Aiken

WHAT will the future shopping experience look like? For the retail industry, it’s a question that has been front of mind throughout the past two years after first enduring the intermittent lockdowns and supply chain shocks of 2020, before 2021 brought with it tectonic shifts in consumer behaviour.

Truths long accepted about how and why people spend where they spend have been disrupted, perhaps forever, with expectant consumers now shopping across multiple channels seeking products that fall close to the centre of a Venn diagram comprised of four decisive factors: convenience, brand experience, personal connection, and sustainability.

Retail through a sustainable lens signals wholesale and welcome changes for both business and consumer.

However, while the latest EY Future Consumer Index indicated consumer sentiment towards sustainability has improved year-on-year, two-thirds of consumers are ‘significantly discouraged’ from buying sustainable goods and products due to the current cost of living.

The demand for affordability is palpable, with many simply not able to pay a green premium on products or goods.

Another factor that continues to influence purchasing decisions, personal connection, is one that was so dearly missed during lockdown.

All those heartfelt ‘thank you!’ shouts to the Amazon delivery driver from a two-metre distance just couldn’t hold a candle to the in-store shopping experience.

The disconnect was inevitable – necessary, even – and so the online pandemic purchases gave rise to a digital fatigue that has helped spur a re-localisation of retail, as we collectively bring forward our newfound appreciation for what’s on our doorstep into this post-lockdown era.

It's a behavioural shift that looks to have evolved beyond the pandemic, too, with a 2022 report by Capgemini revealing consumer preference for in-store shopping has now surpassed pre-pandemic levels, as 72 per cent expect to maintain ‘significant interaction’ with physical brick and mortar stores in the longer term.

This refocus on local has also cast light on the more conscious face of consumerism, whereby customers are actively tracing their product’s sustainability credentials with a critical eye.

Checking the label now goes far beyond bar codes and small print to encompass the entire supply chain, from raw materials to source of manufacture.

In this digital age, brands can be held accountable with the touch of screen, given there are now independent websites dedicated solely to vetting any one company’s claims of sustainability.

It is here where the familiar buzzwords of ‘bio’, ‘organic’ and ‘eco-friendly’ are laid bare as vague and often unverifiable, arming consumers with the knowledge needed to make an informed purchase in spite of any attempts at brand greenwashing.

And yet, baseless or otherwise exaggerated claims of sustainability remain prevalent.

Just last year, for instance, research by the European Union and national consumer protection authorities found that, in 42 per cent of cases, company claims of being ‘green’ or in some way environmentally friendly were either exaggerated, false or deceptive.

Which in many ways has compounded consumer enthusiasm to seek out environmentally sound products and essentially separate fact from fiction.

Consumers have the power to vote with their wallets, whether it’s only buying in-season, opting for second-hand items, or educating themselves on a product’s supply line.

All of which often comes with an inclination towards local with Capgemini finding 63 per cent of consumers have committed to choosing local stores over online marketplaces since the onset of Covid-19.

Leading from the front in this regard is the digitally savvy Generation Z, many of whom are now entering the world of work and subsequently have disposable income to influence emerging and future retail trends.

Chief among them is e-commerce, a sphere largely dominated by Amazon which itself recently planted a flag on the UK high street with its first brick and mortar store amid plans for physical expansion.

Online, it’s a different story; Amazon is a bona fide retail titan of the digital world.

An economy onto itself, though its trailblazing success has not been immune to criticism, with the US House Judiciary subcommittee on antitrust recently warning of Amazon’s monopoly power over third-party sellers, limiting market access and reducing supplier margins.

But in this age of the conscious consumer, there is an open-source pilot taking root in India which vows to democratise digital commerce and siphon power away from Amazon and Walmart.

The Open Network for Digital Commerce (ONDC) will enable micro enterprises and small merchants to connect with local suppliers, customers and delivery firms, helping to create something of a level playing field in the ecommerce space.

What is being pitched as a transparent, open-source platform for neighbourhood traders is reflective of an industry that is increasingly leaning towards local, both online and off.

Facing down the headwinds of 2022, the cost of living crisis, and what will no doubt be remembered as a third consecutive year of great challenge, the retail industry must view post-lockdown consumer habits through a local, sustainable lens as it begins to shape the future shopping experience.

Claire Aiken is managing director of public relations and public affairs company Aiken