Is the business of commerce and marketing completely at odds with the UN’s global goals for sustainable development? On the face, it appears, yes. But digging deeper, it’s possible to envision a future with greener ways of doing commerce, driven by new technology enablers and a mind-set change in how we sell and consume things. Software vendors will be key to that change.
I was recently talking to the head of communications where I work. We were both excited about SAP’s corporate alignment to the global goals, but were wondering – how does this apply to Hybris, the part of SAP that creates commerce, sales, and marketing software? Surely, if anything, our products drive greater – not less consumption – more goods consumed by more people, encouraging more waste, and more atmospheric carbon.
There are many impressive ways that SAP’s diverse portfolio can aid the delivery of a more sustainable future, but for our part – the commerce and marketing area – it felt like, well… not so much.
This got me thinking and researching. I was surprised and inspired by what I found.
Three ways we CAN build sustainable commerce
All evolutionary rather than revolutionary ideas, I am building on the notion powerfully put by Paul Hawken, then actually achieved by the inspirational Ray Anderson of Interface Inc.: we have to work with, not against, market supply chains and principles, and use the power and reach of the modern corporation to deliver lasting sustainability.
It’s exciting to see how new technologies can be a catalyst for sustainability in ways previously not feasible. The switch from small and niche CSR projects to big and mainstream sustainable operations is on.
The consumer is also at the heart of this. Meaning you, me, our friends, families, and associates, and the decisions that we make every day about what we buy, how we buy it, and who we buy it from – hold all the leverage. It merely needs to be empowered by visionary corporations.
To tweak the famous philosophy of Mahatma Gandhi, we need to find ways to “consume the change we want to see in the world.”
Step one to building sustainable commerce: Supply chain transparency
We a rarely think about it, but the supply chain required to deliver even common products into our hands is surprisingly complex. See this example for a pair of Levi’s jeans:
(And that doesn’t include the pre-supply of thread, buttons, rivets, dye, or labels!)
We should consider supply chains more – it’s hugely important to our consumption footprint. The extraction, production, and transformation of raw materials into nice, shiny goods is the engine room of pollution and resource degradation.
Excuse all the tech-jargon and acronyms, but I think it’s now possible to envisage how ERP (Enterprise Resource Planning) and SCM (Supply Chain Management) software can be coupled with IoT (Internet of Things) and Blockchain ledgers, then fed through the PIM (Product Information Management) applications that enable our online searching and shopping journeys, creating an integrated constellation of technologies that would allow a deeper level of transparency into the industrial and consumer supply chain than ever before.
In plain English: as a prospective customer, before I make any purchase, I could be given accurate insights into the component sources and costs, labour conditions, carbon footprint, and environmental implications needed to get the goods from the factory to my front door, or from the farm to my fork.
We live in a world that’s dense with data. These days, it’s all out there, waiting to be harvested. Check out Olivia Tyler’s inspiring talk on supply chain transparency.
I like the approach of online retailer www.everlane.com whose ‘Transparent Pricing’ concept hints at what could be possible:
I accept the limitations: all this detail wouldn’t be that useful or effective during the average time-stressed trip around a local grocery store.
As our shopping habits shift online and we put increasing time into browsing and researching using our smartphones and tablets, this kind of information can become integral and – eventually – a hygiene factor to the shopping process.
Step two to building sustainable commerce: Enlightened choices and preferences
Building on the first idea, what might a shopper do with all this new data and enhanced transparency? One of the great things about e-commerce is the ability to set parameters and store preferences. We can save a regular basket of essential groceries at Ocado. We can sign up to Amazon Prime and get next-day delivery. We can let Netflix scan our viewing habits to suggest our next watch.
We could set sustainable preferences for how we want to shop, like preferences for delivery speed and environmental impact. Or preferences for how we engage the value chain – e.g. preferring to select a product sourced from a small, start-up manufacturer, rather than a global multinational. The choice would be ours.
My bet is if consumers were conveniently given visibility and choice, we would think more about the impact of our purchases, and we WOULD choose differently, especially if prompted by smart marketing algorithms.
The next step: imagine building a sustainable shopping profile across multiple retailers with rewards, donations, or environmental credits based on your shopping history. Like some kind of mash-up of Amazon Prime, Facebook, and the multi-brand loyalty scheme like Nectar Card. Sure, it would take some negotiation between businesses to create this, but make no mistake, the CRM tech is out there to make this happen!
Step three to building sustainable commerce: Product-as-a-service
A lot of great articles are already written on this. Suffice it to say, there are products and industries like automobile, home entertainment, lighting, high-end fashion (to name but a few) where we can expect the business model to be turned on its head as consumers move away from a ‘buy-it & own-it model’ and towards a pay-for-use / subscription / lease model.
The sustainable difference here is, it’s a far less wasteful approach to resource use. Supply is efficiently matched to demand, and products are utilised throughout their useful lifecycle. No more Audi sitting in the garage for 98% of its lifetime.
Certain retailers and manufacturers are already turning to these models. For those who haven’t seriously considered it yet, I have only one thing to say: hurry up!
So, my initial instinct that commerce and marketing have no place in the sustainable development agenda was wrong – actually, this is a huge moment of possibility.
The world is changing and we – consumers and corporations – must change with it. Companies that grasp this chance will find themselves on the right side of history, swimming in the same direction as their customers.
There’s also an opportunity for software vendors. By doubling-down on co-innovation partnerships with businesses and corporations who are willing to take the brave step into the era of Sustainable Commerce, we can jointly build a future that’s fair and just for the next generations to inhabit this planet. Now that’s a goal and a half!