In the last couple years, RILA's sustainability program has focused on change in the retail industry. If you work in retail, you can't miss it: stores are changing, products are changing, markets, supply chains, operations, consumer preferences, and more are changing.
We have talked about this within RILA's sustainability community because sustainability is about change. Sustainability should be used as a tool for strategy development and innovation to adapt to industry change.
Over the next several months, we are summarizing noteworthy articles about these changes and their link to sustainability.
Experimentation in retail is the new norm
If you have been following the Retail Horizons conversations, it is clear that retail is changing. We have been writing about the changes in retail business models already underway.
As the Harvard Business Review explains, experimentation is a key phase of business model transformation. Here are some exciting retail projects oriented toward sustainable business models:
- Sharing. Numerous start-ups are pursuing the sharing economy; take Peerby (who recently won the best urban app in the a competition held at the New Cities Summit in Dallas), Tradesy, Rent the Runway (that now has several physical stores), Pets to Share, TaskRabbit, Yerdle, Airbnb, and many more.
- Take-back. Companies are seeking revenue models through taking back & reusing products: start-ups like Stuffstr and I:CO are developing new business models for recycling; Uptown Cheapskate is an upscale boutique store that sells gently used clothes; Wore it Once connects buyers and sellers of used wedding dresses and other special occasion gowns; ecoATM, from the same company as Coinstar and Redbox, makes it easy to recycle mobile devices; Best Buy, Staples, H&M, Gap, Walmart, and others are (or have tested) offering in-store take-back.
- Purpose-driven. Made to Matter – Handpicked by Target is a collection of natural, organic, and sustainable brands; Whole Foods opened a store in Detroit's food desert; Habitat for Humanity ReStores are home improvement stores whose proceeds are used to rebuild homes; Shinola Detroit sells high-quality products made in Detroit to promote local jobs and manufacturing; Amazon Smile donates a portion of every purchase to a nonprofit of your choosing; Ten Thousand Villages sells products and supports artisans from developing countries.
- Store formats. Fast Company recently wrote about one startup store that "might be a big idea in the long-troubled business of physical retail outlets." Many other retailers are experimenting with new formats to respond to urban markets, convenience, and changing demographic mixes.
- Making. The "maker economy" is thriving. MakerBot opened a storefront in New York City to make custom items and sell printers; Etsy provides a vibrant online community for craftspeople; and The Home Depot and Staples are selling 3D printers.
- Convenience. New models are being tested to facilitate convenience, like Lowe's robotic shopping assistant, Uber ESSENTIALS, Google Express same-day delivery, Trunk Club, and mall "virtual concierge services".
- Health and wellness. Beyond the rapid growth in organic, natural, and local products, several companies are testing marketing techniques to promote healthy foods with kids.
- Augmented reality. Ikea, Heinz, Pepsi, and others are testing augmented reality; and Lowe's Innovation Labs, which sources innovations "through science-fiction prototyping," envisions a "Holoroom" to display virtual renovations.
What does this mean for retail? And sustainability?
Sustainability is a process of continuous improvement – the endless pursuit of new ideas and innovations to make your company stronger, and the natural and human resources you rely on better. Experimentation is critical, especially since the sustainable innovations we need for the future are not available today.
How are you experimenting to find your company's next game-changing sustainable innovations?
To learn more about RILA's program, visit: