GUEST COMMENT The next stage of ecommerce: how big business and start-ups are partnering for sustai
Creating sustainable business growth, by balancing the needs of a growing consumer-base against sustainability concerns – for the environment, the economy and society – is perhaps the 21st century’s biggest business challenge. What may be underestimated, however, is the role of ecommerce to solve this challenge.
Much has been said about the importance of sustainability in light of heightened consumer concerns around ethical and sustainability credentials. However, businesses should also consider the benefits of sustainable practice to create innovative solutions and to drive efficiency in an organisation. Typically, sustainability requires a drive to reduce waste – this process alone is invaluable to businesses looking to streamline their operation. Additional benefits range from improved staff engagement to a more resilient business model in the context of wider global trends.
Whichever reason is most compelling, it’s undeniable that businesses should prioritise sustainability as a concept. However, the challenge is a vast one, and businesses must be smart about how to approach it. By targeting the right, relevant sectors and fixing the models within them, businesses can drive significant change in an effective way. The ecommerce channel is one such target for a sustainability initiative due to its huge potential as a channel for environmental, economic and social wellbeing on a global scale.
Part of the demand for sustainability within ecommerce comes from the recognition that the channel easily lends itself to sustainable solutions. Ecommerce operators are far more scalable than traditional bricks-and-mortar retailers, and they also have the potential to create less waste. Despite this, many logistical ecommerce challenges, such as transport and storage, are still being managed in a similar way to physical stores.
The boom in internet retail shows no sign of slowing, and smaller retailers, who once regarded ecommerce as optional, realise it is fast becoming a requirement. Similarly, medium-sized retailers have reached a tipping point and are poised to become huge. If sustainable practices are to be embedded in the channel, action is needed now to drive the industry to sustainability, and that will demand a shift away from the practices of an offline model. This legacy connection to physical outlets can be resolved with an injection of new stimulus to the industry. And this is where tech start-ups, with a fresh approach and ability to view the industry from the outside, are poised to help.
Although some may consider them an incongruous pair, there is huge value to be gained from corporations working with start-up companies. Big businesses, such as Unilever, recognise that the agile, entrepreneurial nature of small tech companies can help them navigate the changing retail environment. Additionally, because new technology and ideas can be hugely disruptive in almost no time at all (Airbnb and Uber transformed the hotel and taxi industries in a matter of months), big businesses must be ready to expose themselves to new ideas.
And the start-ups benefit from these strategic partnerships too. Disruption is far more than just a great idea after all – it needs to scale fast and reach a wide, relevant audience quick enough to catch on. The major industry players already have that scale with the means to pilot and then grow a new initiative. For start-ups this could mean the difference between being a world-changer and falling by the wayside. For bigger businesses the same is also true.
The development of reciprocal relationships of this sort, motivated by the desire to create a sustainable ecommerce channel, is the driver behind Unilever’s ReHack event
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Held on June 25 and 26 at Shoreditch’s Village Underground, the open competition will provide teams of innovators with the chance to win a contract with Unilever that will enable them to grow their ideas at scale alongside industry leaders.
These partnerships need to be carefully managed and big businesses need to acknowledge the distinct needs of the tech companies with whom they partner. Start-ups have limited resources meaning their time is very valuable and their ideas are their USP. As such, winners of the ReHack competition will be paid while they work with Unilever and retain ownership of any intellectual property created during the event.
It is difficult to guess at the sort of innovations the event will produce, but we can expect the event to produce ideas that range from innovative tech solutions for social change through to supply chain processes and beyond.
Participants’ ideas will be judged according to how much they improve health and well-being for consumers and the wider community, and how far they reduce the sector’s environmental impact, as well as against criteria of innovation and scalability. These are exciting times for ecommerce, and strategic partnerships like these are bound to drive the next shift in the industry.Joe Comiskey is ecommerce UK capability and innovation leader at Unilever