Why Prioritizing Sustainability Can Help Your Retail Business Grow

In today’s retail environment, achieving success often depends on more than just your products. While many brands continue trying to stand out through pricing or other initiatives, others are finding that sustainability is one of the best ways to ensure retail success.

With the right implementation, sustainability efforts can have an impactful and far-reaching outcome on your retail sales and overall growth.

Customers want sustainability

Perhaps the most important reason why retail success and sustainability now go hand in hand is because today’s customers—myself included—want sustainable products. A joint study by NielsenIQ and McKinsey found that 78 percent of customers say a sustainable lifestyle is important. 

More notably, their research into over 600,000 product SKUs found that when products made sustainability-related claims, they experienced 28 percent cumulative growth during a five-year period. However, products that didn’t make sustainability claims saw 20 percent cumulative growth.

Growth isn’t just from products customers choose to purchase—but how much they will spend. In 2024, PwC found that customers were willing to pay an average of 9.7 percent more for sustainable products—even with the rampant concerns about inflation.

When I shop brands, I want to support those who prioritize sustainability and am willing to pay more for it. Many customers today demonstrate this mindset when choosing products, making sustainability poised to become even more important for brands.

Sustainability initiatives enhance operational efficiency

Sustainable practices can also improve your operational efficiency in a way that reduces expenses and boosts your bottom line. A report from the SEAD and International Energy Agency highlighted that over 40 percent of global electricity consumption results from industrial motor systems, air conditioners, refrigerators and lighting systems. However, the energy-efficient products that are available could reduce total energy consumption in each of these categories by 50 percent. 

In my workplace, I try to find ways to integrate sustainability into everyday technology that we already use. One example would be our smart thermostats, which save on energy consumption by automatically adjusting the temperature according to the weather and turn off when people aren’t in the office. Drastic reductions in electricity use are just one of many ways to increase your bottom line.

Retail brands can also make impacts when managing unsold goods or products returned by customers. For e-commerce retailers, the percentage of returned goods can exceed 30 percent, and much of that ends up in landfills.

For example, in a case study by CheckSammy, the Yellowstone National Park Lodges were able to recycle over 25,000 pounds of retired textiles in 2024, contributing to 20 metric tons of CO2 savings. CheckSammy used its Zero Point facilities to receive, sort and separate product returns into the appropriate recycling stream. Such facilities offer retailers and others the ability to aggregate and store materials to the point that they enable economies of scale, lowering the relative costs of diverting those materials away from landfills.  

Organizations that use these Zero Point facilities to manage excess inventories and returned goods can lower their waste costs, monetize recyclable materials and use the accompanying reporting to track their diversion efforts and share progress with stakeholders. 

To achieve the maximum impact in this area, brands must consider their Scope 1, 2 and 3 emissions. Research by McKinsey found that indirect (and often partner-related) Scope 3 emissions account for about 90 percent of a company’s combined emissions. Because of this, retail brands must also collaborate closely with their suppliers and other partners. Examining your direct emissions and developing a strategy to reduce them is relatively straightforward. 

Whether it’s changing how you and your suppliers operate or switching suppliers altogether, both can create new opportunities to improve your profit margins.

Sustainability strengthens your marketing

The full potential of your sustainability efforts will only be unlocked when you use them to differentiate your brand. Improving sustainability can still be a net positive no matter how you do it, but integrating it into your messaging makes it far more impactful for your bottom line.

Highlighting your sustainability through marketing, details on product packaging and other messaging will go a long way in helping you earn your target audience’s trust. A key way to strengthen sustainability messaging is to make sure your company and its products qualify for any relevant sustainability certifications. Eco-minded consumers look for these certifications as a mark that a brand is truly sustainable.

You can also share how you work with ethical partners or use sustainable sourcing in ads and on product packaging. Your company website and social media can also be great ways to highlight efforts like switching to renewable energy or volunteering to support environmental causes. For instance, in my office, we have a wall near our office entrance that is dedicated to displaying the local charities we support as a company. This wall not only sparks great discussions with the people who stop by our office, but it also brings the much-needed awareness to local organizations in the community that they might not know about. 

Regardless of your industry, sustainability as a core messaging element can help you differentiate yourself from competitors in your niche and attract like-minded customers and employees.