A shift in consumer sentiment is leading to increased calls for sustainability in the e-commerce space in the Middle East.
E-commerce growth in 2020 has presented an opportunity for brands to enhance their sustainability through responsible choices and tech-driven operations. A surge in the number of conscious consumers has challenged e-commerce brands to become more eco-friendly by scrutinising their waste, emissions, and product returns.
Driven by increasing concern for the future of our planet, efforts to combat the impact of climate change have spiked. A consumer insights survey by PwC found that 65% of Middle East consumers have become more eco-friendly during the pandemic.
Powered by the sustainability movement within the US, Canada and Europe, e-tail consumers within the region are gradually becoming more conscious of how sustainable the brands they shop online with are. According to a recent report by Nielsen, 66% of global consumers are willing to pay more for sustainable products. Savvy consumers are calling for a change whilst influencing the wider market. A movement is now beginning to take shape within the MENA region, and global leaders in logistics solutions such as Aramex, are at the forefront of inspiring the wider region to become more responsible.
Initiatives to improve last mile sustainability are no longer reserved for a handful of forward-thinking companies. Increasingly, they are becoming a standard that must be reached to make a mark on consumers. CommerCity, a UAE freezone set-up to attract the region’s e-commerce brands, has been at the forefront of pioneering sustainability in the sector. The Dubai-based freezone has introduced solar power as a source of renewable energy and has also reduced water wastage by 40% with the introduction of polluted water treatments, and rainwater collection points.
Aramex is also paving the way with creative and sustainable solutions. Through tech-based operations such as the newly launched WhatsApp chatbot, the logistics-giant has been able to reduce failed deliveries and decrease emissions. Rabih Allaf, Aramex’s Global Segment Director of Consumer and Retail describes the role that the interactive WhatsApp chatbot has had in improving efficiency for the group. “With the introduction of the chatbot, we have a 99% chance of successful delivery.” Rabih describes the chatbot as a huge success, and attributes an increase of first-attempt deliveries to the introduction of the bot. He also adds that the chatbot has successfully enabled Aramex to reduce emissions through AI technology, allowing the customer to select their time and location preferences, in turn reducing second attempt deliveries.
Rabih also details how the introduction of electric scooters has allowed the company to reduce harmful emissions in built-up areas. Rabih says; “In high density areas such as Dubai Marina, in the UAE, there a lot of packages that need to be delivered in a small amount of space. It’s efficient and sustainable for us to use electric vehicles. This is our responsibility as logistics providers.” Aramex first piloted electric vehicles in 2017, which resulted in a roll-out across Jordan. In an effort to cut down emissions, Aramex is planning to test Euro 6 trucks in its fleet, reducing emissions by 15-20%. As one of the first logistics providers to spearhead electric vehicles in the MENA region, Aramex has also committed to converting their entire fleet to electric vehicles in the long-term.
Although Aramex has pioneered several tech-based operations in recent years, Rabih observes that improvements to sustainability do not have to be complex. One example he gives is the importance of checking addresses for a more sustainable last mile delivery; “Aramex is using the primary key, the phone number, to double check the quality of addresses. If we get it right and the parcel is delivered, we’ll save that location.” This has enabled the company to build a reliable database of quality addresses, thus minimising delivery time and improving delivery success rates.
Another sustainable change that many companies are starting to implement is the addition of detailed product descriptions to minimise returns. The Ellen MacArthur Foundation estimates that the global fashion industry loses $100 billion each year from clothing that is landfilled or incinerated, a loss that can be reduced with detailed product descriptions and the addition of photo and video content on product landing pages.
E-tailers looking to make fast and effective changes can do so by removing free product returns. Many online retailers offer customers free product returns as a means to incentivise the customer to purchase more. As a result, many customers order much more than they intend to keep. A recent report by Barclaycard revealed that 30% of shoppers intentionally over-order, with the purpose of returning unwanted free items. If retailers remove the option for free returns, customers will likely think twice before ordering supplementary products.
Switching to sustainable practices not only reduces environmental impact but also positively influences business by improving consumer sentiment and brand loyalty. Encouraged by considerable business benefits, and a concerning global environmental outlook, it is now time for the region’s e-commerce brands to follow the region’s logistics providers and offer sustainable solutions.