SKU’d Thoughts 17: Have consumer companies done enough for the environment?
Last week, I received yet another overpackaged delivery from Amazon and it got me thinking about the part e-commerce companies have to play in preserving our climate. In Amazon’s case, the company recently announced that it will disclose its carbon footprint in 2019 and pledged that half its shipments would be carbon-neutral by 2030. This is major, because only a few e-commerce companies, including eBay and Etsy, disclose carbon footprint information. Traditional retailers with growing online businesses such as Target and Walmart Inc. are not transparent about it.
On the surface, e-commerce seems more favorable to the environment than traditional retail because ordering something online often is less energy intensive than driving to and from a store. However, various factors have now made e-commerce no longer a clear cut carbon reduction option for shopping.
Some of these factors are:
1. Faster Delivery. Amazon has gotten consumers accustomed to receiving their deliveries in two days or less. In some cases, you can even receive your order within an hour with Amazon Prime Now. The convenience of quicker delivery comes at an environmental cost because the probable mode of delivery creates incremental pollution. For an Amazon Prime Now delivery, it’s rare that the courier will actually be at the store at the time of the order so they travel more distance than the customer would have had to. If not for the desire for faster delivery, perhaps merchants could bundle more deliveries instead of expediating one-off shipments.
2. Free Shipping. The e-commerce space is highly competitive and to get consumers through the entire sales funnel, e-tailers offer favorable shipping options which often includes free shipping. The perk undoubtedly makes clicking the confirm order button easier for consumers. It also means customers are more likely to purchase low order quantities that will require packaging to ensure safe and timely delivery.
3. Extra Packaging. All online orders need to be packaged to survive the shipping process so it is an unavoidable variable. According to Fast Company, about 165 billion packages are shipped in the US each year, with the cardboard used roughly equating to more than 1 billion trees. Orders are often overpackaged because merchants want to make sure items get to customers in one piece. Overpackaging has a compounding effect — a bigger package means more packaging waste and more trucks needed on the road to deliver them.
E-commerce customers are accustomed to certain conveniences that have a net-negative effect on the environment. Companies have a responsibility to mitigate this through information transparency and consumer education. Imagine if your Amazon Prime profile showed your carbon footprint from all your Amazon purchases or if during checkout, the various shipping options all had a carbon footprint estimate. Consumers who care about the climate would be empowered with enough information to make more net-positive decisions.
Cross posted on Medium