Plastic Bags 2 - The sequel

Archived article dated Friday March 14th 2008

The debate about plastic bags has really come to life again.

By Helen Dickinson

This issue has become one of the hot talking points of the year, with stories about whole towns planning to ban them, the retailers which are now charging for or dispensing with them and those stores which remain committed to allowing customers to choose becoming a seemingly permanent fixture in the newspapers.

The issue gained momentum last week when the Daily Mail launched its 'Banish the Bags' campaign, and was then followed swiftly by Alistair Darling announcing in his first Budget earlier this week that retailers would be given one year to take action and cut the number of bags in circulation, with the threat of legislation coming into play if they do not comply.

I wrote about green issues in early 2007, when many retailers were starting to formalise plans to put the environment firmly onto their business agendas. Marks & Spencer, with its 100-point 'Plan A', was one of the early movers.

At the time, M&S's announcement attracted widespread publicity and this hasn't gone away. If anything, the 'green' retailing campaign seems to be attracting more attention than ever. For example, the 5p levy for single-use plastic bags in M&S's food stores - currently being trialled in locations across the South West, with proceeds being channelled into environmental projects - is one of the latest developments in M&S's environmental story.

Of course, the plastic bag debate is just one of the wide range of environmental issues which retailers are now considering. I recently chaired a day at the Green Retail Conference, an event which looked at how the sector should respond to the challenge of the green agenda. Subjects discussed included everything from carbon emissions and sourcing policies through to seasonal produce and animal welfare.

However, the fact that these kind of forums are now in place and a have become fixture of the retail calendar demonstrate just how important the environment has become.

And businesses themselves recognise that it isn't going to go away. According to a recent survey of 200 senior UK business executives, carried out by YouGovStone on behalf of the KPMG Carbon Advisory Group, 85% think that climate change is a significant business issue and 77% think it will grow in importance.

However, despite acknowledging its rising importance, 82% admit they still don't have a strategy in place to respond to climate change. The survey questioned a wide cross section of businesses from different industry sectors. But I bet that if they had asked the retail sector specifically, the proportion would have been significantly higher.

And that's because retail has to be. Companies in this sector are, of course, at the sharp end of consumer demand and if they don't like what the see on the shelves and rails of stores it's very easy for them to vote with their feet.

An interesting fact I heard at the Green Retail conference was that it takes four seconds for consumers to make a decision about buying a product in a supermarket. So retailers need to ensure that their offer is right, and that customers trust their 'green credentials' given that they only have a brief opportunity to tempt them into making their purchase.

And let's face it, the views of consumers regarding the environmental impact of products is too big to ignore. According to Defra there are seven segments of consumers:

'positive greens' (18 percent),
'waste watchers' (12 percent),
'concerned consumers' (14 percent),
'cautious participants' (14 percent),
'sideline supporters' (14 percent),
'stalled starters' (10 percent)
'honestly disengaged' (18 percent).

Whilst the latter segment might not be a purchaser of ethical products, the vast majority (82 percent) appear to be interested in what they use and where it comes from - although the extent to which it currently impacts their buying decisions is a matter of debate.

But there are plenty of things retailers can be doing to highlight their green credentials and this is firmly centred on communication. There were another couple of gems of information which struck a chord from the Green Retail conference. The first was that 72 per cent of consumers are more likely to believe a company's message if it comes from an organisation's employees. Retailers are missing an opportunity to communicate their environmental credentials if they don't make sure every member of staff is properly briefed.

And it seems there's more than a touch of cynicism creeping in. The second statistic I remember is that a staggering 79 percent of consumers stated they think that companies pretend to be more ethical to sell more products.

Looking back to what I wrote about retail and the environment this time last year I said that 'the truly good guys will be the retailers who can show their green ambitions were not just hot air'. One year on, it appears that this is more important than ever.

Helen Dickinson is Head of Retail At KPMG

Tagged as: kpmg

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