Over the last few months, a throng of retailers have made pledges and launched initiatives to become more sustainable. But is the middle of a global pandemic the right time to be making these bold claims?

  • Despite the pandemic, 51% of consumers think environmental issues remain important, while 22% think they are more critical than ever
  • However, former Tesco boss Dave Lewis says consumer behaviour “doesn’t always follow that concern”, with price having a big impact 
  • Ikea’s sustainability manager Hege Sæbjørnsen believes retailers must play an active role in the affordability of sustainability”

Retailers have had many challenges to deal with during the coronavirus pandemic, but it’s heartening to see that sustainability has not slipped far down the agenda.

The likes of H&M, Levi’s, Tesco, Asda and even Amazon have all recently unveiled new initiatives committing to more sustainable practices in a bid to switch customer behaviours at a time when so much change is already afoot.

“Pandemic or no pandemic, customers still want to be more sustainable,” says Asda chief executive Roger Burnley. But with a difficult trading environment to navigate, a balance between investment and self-preservation needs to be found.

What the consumer wants

Times may be tough, but that doesn’t mean consumers have forgotten about sustainability. In fact, with more time spent indoors, many consumers have become more aware of their own consumption habits.

According to Kantar’s Covid-19 Barometer, 51% of people think environmental issues remain important, while an additional 22% think they are more critical than ever.

Asda's sustainable store in Middleton, Leeds

Asda’s sustainable store in Middleton, Leeds

Kantar research reveals that pollution and waste reduction are the most concerning factors for consumers, followed closely by product sustainability and local production.

However, many are at a loss for where to start or simply view a more sustainable lifestyle as one they cannot afford or achieve.

This is where retailers need to do the legwork – making it simpler, easier and, importantly, cheaper to choose to shop sustainably.

“When you ask customers about environmental issues, they will tell you that they are important, but their actual behaviour doesn’t always follow that concern”

Dave Lewis 

In fact, 63% of consumers believe it’s up to retailers to become more sustainable on their behalf, according to a GlobalData survey carried out earlier this year.

“There’s been an issue for a long time in the UK,” explains former Tesco boss Dave Lewis. 

“When you ask customers about environmental issues and other responsible things, they will tell you that they are important and very high up on their list, but when it comes to their actual behaviour it doesn’t always follow that concern.” 

“Time, convenience, value, other things come in, so you actually see behaviour that is different from what people say. That’s the dilemma for all of us.”

Ikea UK country sustainability manager Hege Sæbjørnsen agrees: “There’s a perception that being sustainable is a luxury as it’s the expensive option, so we really want to make sure that we play an active role in the affordability of sustainability, making sure that this lifestyle becomes the mainstream, go-to choice for the many.”

Asda has done just with its sustainable store, which launched in Middleton, Leeds, last month. The shop features refill stations for a variety of own-brand and branded products, such as pasta, rice, cereal, tea bags, laundry detergent, shampoo and conditioner. 

Key to the initiative is the ‘Greener at Asda Price’ promise, which guarantees that loose products will not cost more than their packaged counterparts. 

“We don’t see [sustainability] as a choice; we see it as absolutely necessary to so many of our customers,” says Asda senior director of sustainable commercial activity Susan Thomas.

“Do I think customers will drive past other stores to get to Asda if we can give them both great value and do the right thing? Definitely”

Susan Thomas, Asda

“Right now, there’s a lot on their minds, but this is why we feel the ‘Greener at Asda Price’ promise is exactly right for now, because they need us to make it easy. As we enter recession, price is even higher up the list of things our customers care about.

“That remains at the front of our priorities, but it’s not the only thing our customers care about and it’s clear that, more than ever, customers want to buy from businesses they trust to do the right thing and they want help to play their part. 

Thomas thinks this move will attract customers: “Do I think customers will drive past other stores to get to Asda if we can give them both great value and do the right thing? Definitely.”

Sæbjørnsen agrees: “We see the importance of purpose and choosing the brands you feel aligned with as a consumer, so it’s not just mitigating the climate risks, but also safeguarding the business for the future. 

“That’s where we really see our role – to be a proactive partner in finding the solutions for the people.”

UNP IKEA 39692 Greenwich088

Ikea is committed to becoming fully circular and has launched a buy-back and resale scheme

Ikea has launched a ‘Buy Back’ initiative, for example, encouraging customers to sell unwanted Ikea products back to the retailer in return for store credit.

The retailer will then recycle the returned items and sell them again through its second-hand business.

The scheme is just one element of Ikea’s aim to become fully circular.

The Swedish retailer has redesigned its manufacturing principles with four circular loops in mind – reuse, refurbishment, remanufacturing and recycling – including switching up the materials it uses. 

Why now?

While demand may have grown for sustainable products from a consumer perspective, shoppers and businesses alike have been tightening their belts to deal with the impacts of the pandemic. 

Retailers have had to make some tough decisions, including swathes of redundancies, over the past few months. So why should businesses choose now as the time to act, when many may be preoccupied with pure survival tactics?

However, Lewis says it’s not about choosing sustainability or survival.

“We shouldn’t be thinking about whether we do one or the other. How do we actually intrinsically weave into the way that we think about sourcing a sustainable, environmentally sound set of practices? 

“If we in our minds think that there’s a trade-off between responsible and sustainable and the ability for it to be economically sound, I think we’re in a very difficult place.”

“If a retailer is now rethinking their strategy, it makes sense to consider sustainability too, and the retailers that act first will definitely reap the benefits more”

Emily Salter, GlobalData

Thomas says that the coronavirus pandemic is not an excuse not to act. “The pandemic has not slowed climate change. Although, on the whole, people were not prepared for this crisis, we have no such excuse when it comes to climate change – we know its coming and I think the effects are more and more visible. It’s never been clearer that change is necessary.”

GlobalData retail analyst Emily Salter believes that, rather than putting businesses off taking action on sustainability, coronavirus is actually creating an impetus to act now.

“I think that’s why we’re getting so many initiatives announced now,” she says. “Retailers have had time to react to the pandemic and are now regrouping and realising that they need to change the way they work – not only with sustainability but also with their online capabilities. 

“If a retailer is now rethinking their strategy, it makes sense to consider sustainability too, and the retailers that act first will definitely reap the benefits more.”

Playing the long game

Lewis insists that doing the right thing will pay off in the end, in terms of increasing customer numbers and loyalty.

Tessa Clarke, chief executive and co-founder of food-sharing app Olio, which works with retailers including Tesco, Sainsbury’s and Pret to redistribute surplus food to charities and local communities, agrees.

“We have recently uncovered some data which really reinforces that implementing sustainability is not just about doing the right thing, it’s about doing the profitable thing,” she says.

Tesco Olio

Tesco has partnered with food waste app Olio

Olio conducted a survey with 4,000 consumers following the roll-out of its Food Waste Heroes programme to Tesco’s 2,700 UK stores a few weeks ago.

The research revealed that 59% were more likely to shop at the supermarket now they know it is zero waste, and 12% would definitely do so – showing that customers are willing to vote with their wallets.

Clarke also thinks retailers risk being viewed as laggards if they don’t follow the sustainable path many big businesses are taking. 

“Those organisations that recognise the new consumer mindset and really embed sustainability into their DNA will be the ones that are most profitable”

Tessa Clarke, Olio

“In the next 12 to 24 months, we’re going to see the results of retailers’ two, three, four-year planning cycles actually coming out into the market – so, if you are not working on sustainability seriously right now, then you are very quickly at risk of being left behind,” she says.

“We’re undergoing a massive consumer mindset shift right now, and whenever a change takes place it creates new opportunities. I really believe that those organisations that recognise the new consumer mindset and really embed sustainability into their DNA will be the ones that are most profitable.”

Look at Unilever, for example. The FMCG giant revealed last year that its Sustainable Living Brands grew 69% faster than the rest of the business and deliver 75% of its growth.

Superdry chief executive Julian Dunkerton believes being more sustainable will make for a more attractive opportunity for investors.

The fashion retailer, which recently launched a sustainable range including a line of vegan trainers, has ambitions to be one of the most sustainable listed fashion brands in the world.

“I think the interesting thing is going to be the relationship between share price and sustainability, and how the two will go hand in hand,” says Dunkerton. 

“The number of investors who want to invest in ethical shares will outstrip the number available in my opinion. By doing the right thing, therefore, economically we’ll be moving to a better place as well.”

With consumers and investors both valuing ethical businesses more than ever, now could be the time for retailers to place their bets on sustainability. As we all strive to recover from the damaging effects of the pandemic, a green recovery could be the best route for businesses to take.