(Reposting of my post for Environmental Management News, 28/02/2011)
I’ve been spending too much time in the shops lately. Actually, I’ve been checking out online buying opportunities too. Not that I’ve actually bought anything. Rather, I’ve been investigating the state of retailer buy-in to all things ‘green’, ‘ethical’ and ‘sustainable’ in Australia.
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It’s an important question because veterans in the field of sustainability labels and certification schemes, and pioneers in the creation of a greener marketplace, are clear on one thing at least. The big retailers have great power and can be either immensely frustrating barriers to change for the better, or wonderful allies!
To better understand how sustainability, broadly defined, is faring in the retail landscape, I’ve been stalking the aisles and checking out the shelves of stores like Woolworths, Coles, Harvey Norman, Bunnings, JB Hi-Fi, Mitre 10, Kmart and others. I’ve been perusing online retail offerings too, and researching what overseas retailers like Tesco, Marks & Spencer, Walmart and its UK subsidiary ASDA are up to.
So, what is the verdict from my own early in-store investigations? Performance Down Under is less than inspiring. Patchy at best, ad hoc and reactive, and so far away from world’s best practice that it’s sometimes hard to make meaningful comparisons. Far from making sustainability a strategy and a theme to engage consumers, retailers in the main have been responding case by case to a series of external regulatory, commercial and community pressures or other ‘stimuli’.
Examples of this set of rolling responses include, in their own ways, plastic bags, free range eggs and now pork too, container deposits, problems with palm oil and paper-based products, the disappearance of incandescent light globes and the prominence of energy star stickers on white goods and TVs.
When challenged to be more strategic, for example on carbon labeling, the standard major retailer position in Australia is that mainstream consumers aren’t yet asking loudly for environmental, ethical and carbon benefits per se; at least outside of traditional hot button items like animal cruelty, wasteful packaging and the health concerns that drive awareness of and interest in ‘free range’, ‘organic’ and the Mobius recycling symbol among other things.
But what if consumers are always going to be a lagging indicator, a likelihood being voiced in other parts of the world? What if business leadership is the key ingredient for advancing to a more sustainable economy instead of scanning the retail horizons for customer demand to justify action?
And if so, who will break the Mexican stand-off between retailers who aren’t ready to lead on their shelves, and consumers who aren’t ready to demand change at the check out?
I know Australian retailers will argue they are doing good work now in reducing the environmental footprint of their own operations, especially transport logistics, storage and the stores themselves across headline indicators like energy, carbon, water and waste. That’s great, in some cases even admirable, and they’ll doubtless have to do a lot more of it in the years ahead.
Retailers also may feel they are but a way station in the life cycle of many products, sitting between the footprint intensive production stage and the often even more footprint intensive consumer use and post-consumer disposal stages.
Any such excuses and the current performance by retailers, however, are just not good enough given the stakes involved. In our giant consumption value chain, retailers are the crucial interface between production and end use, and a vital intervention point to influence both suppliers and consumers.
Government, for example, can require energy ratings stickers on white goods and TVs, and fuel efficiency ones for motor vehicles. But those stickers become more powerful if prospective purchasers deal with sales people who are knowledgeable about the ratings and actively promote the operating cost benefits on offer.
Retailers also are morphing into major producers and brand owners in their own right, with a rising tide of house brand products. In Australia, too, the biggest retailers like the Woolworths and Wesfarmers groups have extraordinary dominance of the marketplace based on international comparisons, with Woolies and Coles tying up an estimated 70% of grocery retailing for example.
Beyond being big grocers, they are big in others areas too like petrol, alcohol, pubs and gaming, clothing, general merchandise, hardware and office supplies. They are far more than stores, for example playing critical roles in food supply distribution across the nation, in good times and also in times of emergencies.
Putting aside whether consumers are green, leaning that way, still needing to learn more or even intransigent brown bombers, there are some very practical reasons for retailers to get more engaged in the consumer-focused end of sustainability. Cost of living increases in key areas like fuel, electricity, food and even waste disposal are top of mind for many people now and they will drive new products, services and business models, including more and more online alternatives to traditional retailing.
Australian retailers are not generally regarded as being among the world’s great innovators, but we need them to move past tentative baby steps and at least be faster followers.
This is an opportunity for retailers to step up and exert positive influence in the marketplace commensurate with their power. If the established retailers miss the boat on this, others will sail in and seize the advantage.
No doubt we’ll all have lots of ideas about what the retailers should do. I know I do. But in the end what we want is for them to be engaged and innovating for solutions that can work for their businesses and society.
Overseas examples include:
To better understand how sustainability, broadly defined, is faring in the retail landscape, I’ve been stalking the aisles and checking out the shelves of stores like Woolworths, Coles, Harvey Norman, Bunnings, JB Hi-Fi, Mitre 10, Kmart and others. I’ve been perusing online retail offerings too, and researching what overseas retailers like Tesco, Marks & Spencer, Walmart and its UK subsidiary ASDA are up to.
So, what is the verdict from my own early in-store investigations? Performance Down Under is less than inspiring. Patchy at best, ad hoc and reactive, and so far away from world’s best practice that it’s sometimes hard to make meaningful comparisons. Far from making sustainability a strategy and a theme to engage consumers, retailers in the main have been responding case by case to a series of external regulatory, commercial and community pressures or other ‘stimuli’.
Examples of this set of rolling responses include, in their own ways, plastic bags, free range eggs and now pork too, container deposits, problems with palm oil and paper-based products, the disappearance of incandescent light globes and the prominence of energy star stickers on white goods and TVs.
When challenged to be more strategic, for example on carbon labeling, the standard major retailer position in Australia is that mainstream consumers aren’t yet asking loudly for environmental, ethical and carbon benefits per se; at least outside of traditional hot button items like animal cruelty, wasteful packaging and the health concerns that drive awareness of and interest in ‘free range’, ‘organic’ and the Mobius recycling symbol among other things.
But what if consumers are always going to be a lagging indicator, a likelihood being voiced in other parts of the world? What if business leadership is the key ingredient for advancing to a more sustainable economy instead of scanning the retail horizons for customer demand to justify action?
And if so, who will break the Mexican stand-off between retailers who aren’t ready to lead on their shelves, and consumers who aren’t ready to demand change at the check out?
I know Australian retailers will argue they are doing good work now in reducing the environmental footprint of their own operations, especially transport logistics, storage and the stores themselves across headline indicators like energy, carbon, water and waste. That’s great, in some cases even admirable, and they’ll doubtless have to do a lot more of it in the years ahead.
Retailers also may feel they are but a way station in the life cycle of many products, sitting between the footprint intensive production stage and the often even more footprint intensive consumer use and post-consumer disposal stages.
Any such excuses and the current performance by retailers, however, are just not good enough given the stakes involved. In our giant consumption value chain, retailers are the crucial interface between production and end use, and a vital intervention point to influence both suppliers and consumers.
Government, for example, can require energy ratings stickers on white goods and TVs, and fuel efficiency ones for motor vehicles. But those stickers become more powerful if prospective purchasers deal with sales people who are knowledgeable about the ratings and actively promote the operating cost benefits on offer.
Retailers also are morphing into major producers and brand owners in their own right, with a rising tide of house brand products. In Australia, too, the biggest retailers like the Woolworths and Wesfarmers groups have extraordinary dominance of the marketplace based on international comparisons, with Woolies and Coles tying up an estimated 70% of grocery retailing for example.
Beyond being big grocers, they are big in others areas too like petrol, alcohol, pubs and gaming, clothing, general merchandise, hardware and office supplies. They are far more than stores, for example playing critical roles in food supply distribution across the nation, in good times and also in times of emergencies.
Putting aside whether consumers are green, leaning that way, still needing to learn more or even intransigent brown bombers, there are some very practical reasons for retailers to get more engaged in the consumer-focused end of sustainability. Cost of living increases in key areas like fuel, electricity, food and even waste disposal are top of mind for many people now and they will drive new products, services and business models, including more and more online alternatives to traditional retailing.
Australian retailers are not generally regarded as being among the world’s great innovators, but we need them to move past tentative baby steps and at least be faster followers.
This is an opportunity for retailers to step up and exert positive influence in the marketplace commensurate with their power. If the established retailers miss the boat on this, others will sail in and seize the advantage.
No doubt we’ll all have lots of ideas about what the retailers should do. I know I do. But in the end what we want is for them to be engaged and innovating for solutions that can work for their businesses and society.
Overseas examples include:
- the ‘Greener Tesco’ initiative and their special ‘green points’ on the chain’s Clubcard loyalty system;
- Marks & Spencer’s far-reaching ‘Plan A - Doing the right thing’;
- the giant Walmart’s Sustainable Product Index, with its ultimate aim to provide customers with an ‘easy to understand rating system so they can make choices and consume in a more sustainable way’; and
- ASDA, the Walmart subsidiary in the UK, with its focus in three key areas – products, energy and waste. ASDA is polling its customers and followers on what should be highest priority, and currently stocking ‘sustainable products’ is in first place, well clear of ‘zero waste’ then ‘renewable energy’.
And we actually need to get rid of some of the shelves altogether, replacing shops with online options, and substituting experiences and services for physical ‘stuff’. I’m going back to the shops soon. I hope to see change!
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