May 10, 2015

Can Walmart Get Us to Buy Sustainable Products?

A couple months ago, walmart.com launched an interesting and potentially important initiative to help consumers find products made by "sustainability leaders." The day it launched, I posted a piece at HBR.org that laid out the program, supported the idea, but suggested some important caveats. It began...

We all want to buy the best products we can find and afford. But what does “best” actually mean? The ones that offer the best bang for the buck, last the longest, or give us the most pride of ownership? How about a product that minimizes its environmental impacts or tries to make the world a better place? Identifying the companies that make these more “sustainable” products has been nearly impossible… until now.

On Tuesday, the world’s largest retailer took a major and important step toward helping all of us shop more smartly. Walmart’s ecommerce site is now labeling 3,000 products, made by more than 100 companies, with a badge that reads “Made by a Sustainability Leader.” For the first time, a major retailer is giving prominent shelf space — albeit virtual — to companies operating in a better way.

The story of how this badge came to be, and the information backing it up, requires some background...

(See the rest of the article here.)

In the weeks that followed, the commentary on Walmart's program ranged from pretty positive (see Joel Makower's take) to more concerned about the confusion it could create for consumers (Jeffrey Hollender, founder of Seventh Generation, led the charge on this front).

Walmart%20Sustainability%20Badge.jpg

The core concern, and one I do share to some extent, is about product-level vs. company-level sustainability. By relying on data from The Sustainability Consortium, which focuses on company-level actions within product categories, Walmart is highlighting companies doing well, not necessarily declaring a product sustainable.

The dilemma is a tough one. Even in our "big data" world, we don't have the information yet to put together easy lifecycle analyses on every SKU on retail shelves. But we can identify companies addressing the 'hot spots' in the value chains for key product categories. So do we wait for ideal data down the road, or start to point consumers to the good actors? I lean toward the latter, but recognize that consumers could easily get confused and disillusioned with the whole affair.

As I look back a couple months later, I wonder whether Walmart (and all of us) will learn what we'd like to from the program. As executed on the site, the label is hard to see and the "Sustainability Leaders" sub-site is not easy to find. In theory, this program will help answer the long-standing question of whether consumers will really buy better products, all else being equal. It remains to be seen if Walmart can gather that data (and share it with all of us!).

So I'm still positive, but you should check out walmart.com, my article, and some of the commentary elsewhere and see what you think...

(Andrew's new book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot. Sign up for Andrew Winston's blog, via RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston)

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