The main advantage of e-commerce is convenience. Browse products from the comfort of your home, compare deals without traveling from store to store, and get what you want delivered to your desired location. But to continue enjoying this comfort, they need to make it more sustainable.
The importance of sustainability has long been recognized across the industry. Nevertheless, many obstacles are slowing the transition to more sustainable practices. Advanced data collection and analysis techniques are raising expectations that green e-commerce is possible and can also improve business profitability.
Sustainability – Honest Goals or Greenwashing?
Most growing companies are committed to sustainability. This indicates awareness of general trends in consumer behavior. For example, internet searches for sustainable products have increased by 71% over the past five years. But does this represent a real change in how products are manufactured and delivered?
Greenwashing – Portraying business practices or products as being more environmentally friendly than they actually are has been around for decades. Jay Westerfeld, who coined the term in 1986, warned that greenwashing practices will evolve as the 2024 Earth Day marketing campaign approaches. Understanding these new forms of greenwashing is especially important at a time when AI’s ability to communicate information is rapidly increasing, he says.
AI brings new challenges, but today’s consumers, especially the digital native generation, can dig deeper. The increase in sustainability-related online searches shows that consumers want to learn about products rather than making hasty purchasing decisions. Therefore, even if you ignore ethical and environmental concerns, companies must make an honest effort in their touted sustainability goals to continue to attract customers.
How to make e-commerce sustainable
Rather than using AI to spread half-truths, brands can use solutions like this to make sustainable e-commerce profitable. You will be able to collect hard facts that will help you. Some focus areas are important for online providers to meaningfully address this goal.
Minimizing Overproduction Through Demand Forecasting:
Continuously producing far more than you sell usually means bad business. Even in cases where overproduction works economically, as in the case of large companies in the fashion industry, production data is kept secret, knowing full well that disclosing large-scale waste would cause reputational damage. It has been.
Therefore, the wisest e-commerce strategy is to optimize the supply chain to minimize overproduction. Advanced demand forecasting, especially using ML-based tools, is the most promising way to achieve this.
Many global and local factors influence fluctuations in demand along the supply chain, from changes in advertising and market trends to political events and weather. Many data points on these and other variables are publicly available online. The key to successful forecasting in e-commerce lies in the ability to extract location-specific public data from a variety of sources.
Competitive advantage when promoting sustainable products:
Sustainable products can create different impressions among customers. While some see sustainability as a bonus, others wonder if it comes at the expense of quality features. Online providers need to take this into account when deciding how to promote sustainable services in the face of fierce competition.
The competitive advantage lies in the nature of electronic commerce, which allows automatic monitoring of all competitive activities in real time. Tracking price changes helps suppliers analyze the market for sustainably produced products and identify opportunities to offer the best deals. Meanwhile, gathering information about how your competitors promote their sustainable products can reveal which customer demographics they’re appealing to.
Reusable packaging implementation:
Packaging decisions have a significant influence on whether or not sustainable e-commerce is possible. Even with ongoing attempts, the adoption of reusable packaging is frequently hampered by unpredictabilities and cost difficulties.
Experts at McKinsey have observed that in order to successfully scale reusable packaging, in-depth study of the relevant sociological, economic, and environmental aspects will be necessary. Careful planning supported by diverse data is required to estimate the costs of the required infrastructure, make sure that the reusability system’s CO2 emissions and water consumption do not outweigh its benefits, and figure out how to encourage consumer cooperation.
The consumer sentiment and market data collected should reflect the different geographic locations covered by the e-commerce provider. Field research will improve planning decisions when scaling up the transition to reusable packaging and allow local sustainability concerns to be taken into account in financing.
Sustainability of Data Collection
When it comes to using data to enable sustainable e-commerce, the reality is that large-scale data collection itself can be used on millions of devices running at any given time. requires an energy-intensive infrastructure based on servers. The resource and process optimization enabled by such infrastructure likely compensates for its shortcomings. However, industry leaders must take on the remaining challenges themselves.
In the web intelligence collection industry, several factors are important to advancing sustainability goals.
- Companies can avoid waste by collecting only the data points they need and using the best and most efficient solutions to reduce errors and retries. The dynamic nature of marketplace websites makes collecting e-commerce data difficult, but by following best practices or seeking expert advice, you can achieve your data goals with fewer attempts. Additionally, resources are protected by avoiding IP blocks and saving storage space.
- Automatic web data extraction is based on a private proxy. Millions of user devices around the world are connected to the internet and are already consuming energy. By incentivizing device owners to lease unused bandwidth, more value can be generated through shared resources.
- Data centers that would otherwise be decommissioned are being refurbished to host proxies for public data collection, extending the lifecycle of existing infrastructure.
- Combining already available hardware to create a reliable and effective web data collection infrastructure reduces the need for companies to develop customized solutions. Such infrastructure, like well-functioning public transport, is therefore cost-effective for users and contributes to saving resources.
In an ideal world, perhaps in the future companies collecting web intelligence and data owners would be able to agree to the free flow of data and dispense with anti-scraping measures. While these measures result in a resource-intensive cat-and-mouse game in creating or circumventing scraping hurdles, the best we can do is improve our own data collection practices. It’s about being as sustainable as possible.
A shift to sustainable products and practices in e-commerce is the only long-term option. But despite honest intentions, projects that advance this transition often fail.
Suppliers need time-critical and location-specific data to optimize their supply chains and achieve economic sustainability. Large-scale data collection can be resource-intensive, but businesses need reliable information to avoid wasteful decisions. Finding ways to make data collection infrastructure more effective and sustainable is critical to the future of e-commerce.