Will digital transactions be transformed for good?

Let’s get this out of the way: will all your business from henceforth be online? No. The current shift to digital is being driven by […]

Let’s get this out of the way: will all your business from henceforth be online? No. The current shift to digital is being driven by a huge number of factors, from the closure of physical stores (an undeniably significant contributor), to the fact we’re all now largely present at home to deal with the challenges of last mile & last meter delivery.

New working habits and an increasing familiarity will undoubtedly result in a significant legacy swing towards digital purchasing, but I’m more interested in how some of the more specific sustainability-focused trends we were exploring back in 2020BC (Before Corona) are going to be exacerbated by what’s happened in the last few months, and how they’ll transform our online transactions for the better.

These may be trends in their infancy, but it’s always worth having an eye on the horizon, as it can be closer than you think. They also offer opportunity for brands to be an early mover, and to offer leadership in and beyond their category, to both consumers and competitors.

A move to more conscious consideration

Firstly, we’re seeing how a shift in the role a brand’s ethics – and impact – plays in product choice. At the beginning of the year, we were talking about the move from brand-level ethical claims and purpose programmes to item-level transparency, giving consumers greater visibility of a specific purchase.

We’ve got a few firm favourites in this category. Skyscanner’s ‘greener flights’ being one. With a simple filter, Skyscanner caters for those seeking visibility of the relative environmental impact of their choices (basing the data on aircraft age and type). While the travel sector may have bigger things to worry about now, it’s an interesting example for any aggregator or repertoire brand. Where bands fail to offer this sort of simple service, we’re seeing others step in: such as the Vegan Filter, a browser extension that automatically filters products on over 20 major retailers’ sites to reflect the user’s dietary preferences.

From environmental to social credentials

We’re now anticipating that we’ll see a greater emphasis on the social, not just environmental, dimension of brand impact, as brands’ role as employers becomes part of broader social narratives. It’s a tactic that’s being embraced by brands with an existing ethical bent, like Everlane and Reformation which offer item-level supply chain accountability: but expect to see more mainstream players pick up on the trend.

Aggregators provide additional incentives

It used to be a full-time job keeping up with the ethics of every business you shop at, but that’s no longer the case. From a Covid-specific perspective, there’s didtheyhelp.com: a site which tracks how companies acted during the pandemic, not just what they promised. More broadly, players like Aspiration bank will gradually raise the profile of corporate (mis)behaviour in this space: it allocates companies an AIM (Aspiration Impact Measurement) score that quantifies their environmental and social impact based on available data.

A lack of corporate support can even turn your own suppliers into a force to be reckoned with, as in the case of Lost Stock. It’s a retail effort created by online fashion store Mallzee to support the garment factory workers in Bangladesh, offering the chance to buy a box of clothes from the cancelled orders of high street names like TopShop and Gap. It’s a great initiative – one that would have been even better if it came from those brands themselves – but its existence highlights the lack of responsibility felt by so many on the high street to their global supply chain and the lives that are part of it.

Technology as an accelerator, not an end-goal

Without doubt, the increased use of digital services shines a light on the need to better factor environmental and social governance (ESG) into a company or brand’s supply chain.

Nowhere is this more visible than within the increasing number of companies that have committed to 1.5C-aligned carbon reduction targets across their value chains. Given that emissions from the supply chain typically represent more than 40% of a company’s carbon footprint, it really is an anomaly that end-to-end traceability of goods across the value chain remains so out-of-reach for many of them. M&S and Primark have launched digital supply chain mapping exercises to better improve transparency and Unilever has turned to blockchain technology for this. But many others lag.

Right now, technology seems like a great way of engaging with suppliers to build more sustainable supply chains. But, as we dig deeper into the value chain, supplier engagement becomes more necessary. If brands want data from tier two and three suppliers, they will need to adjust what they’re looking for to drive performance, rather than just allocating data to a brand.

The bottom line

Social impact is becoming more and more visible – whether you want it to, or not. Now is the time to consider how your brand might operate in a future where item-level transparency is the norm, and where keeping tabs on the brands we shop from is no longer hard work.