Ethical retail and Gen Z - Can Gen Z’s buying habits reshape retail?

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With COP 27 and soaring energy prices bringing climate consciousness to the fore, delivering sustainability is top of the agenda for both businesses and consumers. Bdaily’s Mark Adair investigates how the buying habits of young people are changing in the midst of a climate emergency.

A UNiDAYS’ research report revealed that 67 per cent of Gen Z claim they prefer brands that appeal to their social conscience. 

However, the majority of students (67 per cent) feel they don’t know enough about delivery services to assess which options are the most eco-friendly. So now, this rising consumer group is turning to brands to provide simple, cost-effective, and environmentally friendly last-mile delivery solutions.

Surprisingly, 1 in 3 students think clothing brands should stop providing next-day delivery if it improves their sustainability credentials. This should give retailers the confidence to begin to implement and communicate changes to their delivery options, empowering consumers to support a more sustainable delivery model.

Given that 60 per cent of respondents claim transparent communication on sustainability is a priority, an easy first step for retailers to achieve this is to be clear about their existing delivery services.

Taking action now could not only help gain consumer loyalty with Gen Z, but also provide retailers with first mover advantage. Recent findings from ParcelSupport showed that only 4 per cent of retailers offer carbon neutral delivery (a category of sustainability Gen Z feels most informed about), just 6 per cent offer less packaging as an option at checkout and none provide sustainability messaging in their delivery communication.

Discussing the results of the report, Alex Gallagher, chief strategy officer at UNiDAYS answered: “The findings from our Sustainability report should empower retailers to enhance their supply chains to meet the environmentally conscious needs of Gen Z consumers.”

A new report by UK consultancy firm Alchemmy found three in four (75 per cent) Gen Z consumers make purchases based on their values. This compares to only 67 percent of the general population.

The report ‘Future of Retail: Is Generation Z leading the way?’ explores consumer retail behaviour of all generations. It found three in five (58 per cent) Gen Zers are more likely to buy products with sustainability claims, compared with just 45 percent of all consumers.

The study gives further evidence of how the retail industry will have to adjust in the future as Gen Z increases its spending power and influence on the market.

Alchemmy’s director of retail and consumer Lucy Gibbs says: “With consumer confidence at an all-time low and an unprecedented cost-of-living crisis looming, retailers now need to listen harder and think bigger at a time when business-as-usual is already challenging enough. Gen Z has lived entirely as digital natives in turbulent times and is uniquely placed to provide the inspiration that lights the way.”

Even with consumers’ desires for a more conscious retail environment, there are still many retail malpractices that stand to be highly profitable and popular, most notably; fast fashion. Fast fashion describes a business model of low cost and mass-produced trending designs hitting retail store’s shelves whilst demand is at its highest.

Fast fashion practices have been accused of forcing underpaid workers into unsafe work environments as well as contributing to climate change and pollution.

In spite of this, fast fashion still stands to be a highly profitable industry. Research in the ‘fast fashion global market opportunities and strategies to 2030: Covid-19 Growth and change’ found that in 2020, the global fast fashion market was valued at $68.6bn. The report goes on to forecast its value to rise to $300bn by 2030.

With low costs coupling with on-trend designs, it’s no surprise that fast fashion has a sizeable hold over retail culture. However, as consumers become increasingly aware of the environmental and ethical impacts of fast fashion, it’s becoming a less than trendy practice.

The popular dating show Love Island cut ties with the fast fashion brand pretty little thing, instead opting to sponsor Ebays ‘Preloved fashion’ campaign as buying second hand clothes sees a new lease of life.

Online retailer thredUP’s 2021 report found that the clothing resale market is seeing growth at a rate 11 times faster than other forms of retail, with an estimated value of $84bn by 2030.

These findings indicate that changes to consumer culture may be just beyond the horizon. Whilst ethical consumerism currently doesn’t boast the profits of traditional retail practices, as climate consciousness becomes more and more prevalent, perhaps the hearts and minds of consumers will be what it takes to push the brakes on fast fashion.

By Mark Adair, Correspondent, Bdaily

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