As I’m writing this blog, the news is breaking that President Trump may pull out of the Paris agreement. Which makes my story about Walmart and product innovation all the more relevant.
My relationship with Walmart started over six years ago, working towards their 20 MMT greenhouse gas (GHG) reduction goal. After some trial and error, and an exhaustive scan of greenhouse gas hotspots, it became clear that we would need to attack every point of the product lifecycle (including things like fertilizer optimization for crops and factory energy efficiency). Little did we know at the time that promoting energy-efficient products to Walmart shoppers–particularly LED lightbulbs–would prove to be so important to reach the goal in 2015.
As Walmart sets out on its next ambitious goal to remove 1 gigaton (aka 1 billion tons) of greenhouse gasses (GHGs) from the supply chain, I can’t help but wonder what the next game-changing product will be?
I don’t think the solution will be as easy as another LED lightbulb, but rather a series of disruptive innovations around how products are designed, sold and treated at the end of use.
Last month’s event focused on climate impacts, which largely come from the materials and processes used to manufacture and transport products. Design changes can play a big role in reducing those impacts. It can also transform products into circular products, with their materials being recaptured by the economy or the planet to live another life as a component of a new product.
Point of Sale: how products are sold
The face of retail is shifting – not just from brick-and-mortar stores to online retail, but from an economy dominated by retail-to-customer relationships to one with more peer-to-peer transactions – just look at Airbnb and Lyft. This “sharing economy” has the potential to displace the number of new items needed as people increasingly use what has already been manufactured, sold and used. This can have big environmental benefits – sort of like eliminating food waste, but for general merchandise.
[Tweet “How products are designed, sold and treated at the end-of-life can be a huge opportunity for retailers.”]
It hasn’t really taken off yet for retail, but companies like POSHMARK and ThredUp – where you can buy and sell fashion – and Spinlister – where you can rent someone’s bike – are working to change that. This will become more prevalent over time, especially as millennials have shown a preference for owning less things.
End of life: how to extend the life of a product
The sharing economy has the potential to delay a product from coming to its end of life as quickly, but once it does, innovative companies like Stuffstr can help consumers better manage what they do with their products by making resale, donations, recycling just as easy as throwing things away.
And, Stuffstr isn’t just an innovation that benefits end-consumers, but one that can help retailers understand how consumers use, and part with, the products they buy – creating opportunities to stay relevant as the sharing economy continues to grow.
It’s clear that Walmart’s goal will catalyze innovation in how we think about products and their use. The GHGs that go into creating, selling and disposing of products is too great to ignore. I look forward to seeing which Walmart suppliers step up to the challenge.
Follow Jenny on Twitter, @JennyKAhlen
Additional Resources: Supply Chain Solutions Center
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