Environmental Sustainability: Key To Successful E-commerce Business

Online marketplaces and D2C brands are today focusing heavily on environmental sustainability in terms of products, services and packaging

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Consumers are today increasingly realizing the importance of environmental sustainability. They are going for products that can sustain our planet's finite resources.

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E-commerce businesses are cashing in on this demand and are also doing their bit to the planet by focusing on sustainability. From products and services to packaging, environmental awareness is the new trend in India's booming e-commerce sector.

Environmental sustainability is expected to be the key going forward as well for e-commerce businesses and D2C brands and brands that do not adapt to the change may lose out. Since the last few years, a lot of legacy brands have embraced this as well and have been launching "healthier, good-for you' sub-brands.

"We have witnessed that our audience is leading the way when it comes to adapting sustainability and conscious consumerism. With these self-care characteristics of the millennial lifestyle, we have developed the communication curve for our audience, where we timely educate them about our products as well as communicate for their feedback, so that our way forward plans are chalked out as per their needs and requirements," said Tarun Sharma, CEO and co-founder, mCaffeine.

Factors Leading To Awareness

According to a worldwide survey conducted by Nielsen that reached out to almost 30,000 respondents, more than 70 per cent of GenZ respondents and 80 per cent of millennial respondents expect brands to become more sustainable and are keen to vote with their dollars.

"Humanity gets driven by panic. In the last few years, we all have seen forest fires, heatwaves, ravaging floods and other calamities. The extreme weather conditions caused by climate changes have wreaked havoc in our lives. This has led to concerns for the future of our planet and the younger generation, who often have a 360-degree view of everything that is happening in the world, is leading the call," said Rajeev Suri, managing partner, Orios Venture Partners.

He also added that youngsters usually don't have any vested interest that can stop them from supporting genuine causes. "The GenZers are biased towards sustainability. On top of it, they are highly connected. So now a connected generation, that is able to gain strength from each other, is causing the sustainability wave," added Suri.

Moreover, in the last one-and-a-half years, staying at home has become a norm. People are realizing how every individual needs to not only ensure that he or she stays healthy, but also see to it that the burden on nature is reduced. "COVID has reminded everyone the importance of being healthy, whether it's increased use of supplements, more yoga, fitness at home, healthier snacks etc are all the spillover effects of that," said Rohit Krishna, general partner, WEH Ventures.

Initiatives By These Brands

In June last year, Flipkart Group launched a series of interventions on environmental sustainability and said that it has reduced the use of single-use plastics by 50 per cent in our supply chain. Flipkart's overall environmental sustainability efforts include the introduction of electric vehicles in its last-mile delivery network, resource efficiency and use of renewables, waste reduction and management, and ISO 14001 certification for strategic facilities.

Similarly, in June 2020, Amazon India announced that it has achieved a significant milestone in its efforts towards sustainability by eliminating all single-use plastic in packaging originating from its 50-plus fulfillment centers in India.

Many leading brands such as The Body Shop, Unilever and Starbucks, among others, have been focussing on sustainability for many years. In fact, Havells India and Godrej Consumer Products were among the 12 Indian companies that were included in the Dow Jones Sustainability Index (DJSI) in 2019.

D2C brands are also today following e-commerce giants and taking the sustainability route. For instance, MyGlamm claims that over 90 per cent of its product portfolio is vegan.

"Being a brand that regularly creates products that are in touch with our consumers, we have come to learn that our consumers while being beauty enthusiasts are also conscious shoppers and are extremely aware of what ingredients are used in their products. They want clean formulations and cruelty-free products. Responsible beauty is extremely important after all true beauty can only be achieved when no harm is done," said Darpan Sanghvi, founder and CEO, MyGlamm.

Founded in 2017, MyGlamm recently closed its series C INR 530 crores funding. And, the core focus for the brand has been on a healthy beauty lifestyle for its consumers. The company's beauty products claim to feature innovative, high-efficacy, good-for-you formulas that are 100 per cent cruelty-free and are PETA verified.

mCaffeine also claims to offer 100 per cent natural and Peta-certified vegan cruelty-free products. Besides, with its packaging, the startup claims to recycle more plastic than its actual usage. With the ratio of 80 per cent glass material and 20 per cent recyclable plastic material, it says it has earned 76,375 plastic credits by offsetting equal kilograms of plastic.

"Transparency is key. That starts with the packaging and continues on to the communication in social media platforms. Noto, a healthy ice-cream brand for example, started the movement towards highlighting the calories in a tub of ice cream in India," added Krishna of WEH Ventures which has invested in Noto.

Efforts Needed

COVID-19 has been a boon to reducing pollution and has brought back the common man's focus towards the environment. However, more needs to be done soon.

"In the last one-and-a-half years, we have cut down on fuel and have adapted sustainability in all ways. Technological innovations have enabled them. Going ahead, the innovations have to be further supported with disruption in the industry as a whole," said Suri from Orios Venture Partners.

Experts also feel that brands should wholly embrace it and not in bits and pieces or just as a marketing gimmick. "What's good for you might not necessarily be good for the world. They are two different things. To satisfy the latter, one has to focus more on carbon footprint while shipping, the kind of packaging used, carbon footprint while manufacturing, etc. Some brands have wholly embraced it all like Switch Fix, which is good for you and good for the environment," said Krishna from WEH Ventures.