Ethical E-Commerce and Consumer Activism: All You Need to Know
E-commerce businesses often have to adapt to the ever-changing technological conditions of the market. New technology like mobile phones meant that businesses had to optimize their websites for mobile commerce. The rise of artificial intelligence meant that in order to stay ahead of competitors, businesses had to utilize these technologies to give consumers the greater personalized experience that they now expect. The growth in social media platforms meant that marketers needed to adapt their marketing practices to the more socially-geared consumer, who is not only interested in products, but is also interested in interacting and engaging with the producers behind the products, through the two-way line of social media communication. But these days, e-commerce businesses are experiencing more than a change in the technological world: They are experiencing a change in a cultural one.
There is a new reality for e-commerce businesses, and that is the growing amount of socially-conscious activist consumers
With the citizenry’s growing concern for our carbon footprint, data security, fair treatment of employees, and politics of companies and advertisers, paying attention to the growing issues of ethical e-commerce has become essential to any e-commerce business owner who wishes to keep up with the new age activist consumers.
It has been just over a year since an estimated seven million people around the world participated in a protest movement, known as the Women’s March, publicly rallying for human rights surrounding immigration, healthcare, race, LGBTQ equality, and much more. But while the Women’s March and similar protests have been the most visible, studies show that less visible, quieter protests have been happening every single day. In fact, activism in the United States is now at a high point, with studies showing that 85 percent of Americans have participated in some form of cultural protest in the past year. Many of these people consider themselves activist consumers, in a broad approach called pan-activism.
No longer is the only form of activism the physical protest, in which people gather in groups and proclaim their beliefs on the streets. Activists are now using all the tools at their disposal to change the world as they see fit, ranging from the ballot box to Twitter hashtags.
With this new approach to protest, brands have found themselves as one of the top targets. Consumer activists realize that they can influence the activities of brands by leveraging their buying power to influence how brands conduct their activity, with the purpose of making brands conduct business in a more ethical manner.
One of the forms that activism for ethical business practices takes is the boycott, such as the case of consumers boycotting Starbucks over the company’s challenges to Trump’s immigration policies, or the boycott of Uber over their perceived support of them. Another form that it can take is for activist consumers to call for advertisers to pull spending from content that they object to, such as activist David Hogg’s appeal to marketers to pull advertising dollars away from Laura Ingraham’s program on Fox News, after her comments about the Parkland Shooting survivors on Twitter.
Even if you think that your business may not be at risk for these types of large-scale and public forms of protests, ethical e-commerce is still a trend that your business will want to pay close attention to. There is a growing segment of consumers, who are now looking to brands to join them in their mission to make the world a better place. Increasingly, purchasers are expecting brands to put their values on display, and do more than sell goods and pursue profits. Moreover, silence on these issues is not necessarily an option, as silence can be viewed as complicity in the processes activist consumers wish to change, and therefore, can be perceived as a social or political stance in itself.
For these reasons, ethical e-commerce is more important than ever, and there can be great benefits to your business for hopping on the trend, while ignoring the trends of the time can have severely negative consequences. For example, 73 percent of millenials are more willing to spend on sustainable products than on unsustainable products.
Moreover, engaging in ethical e-commerce is not only important for those businesses for whom younger consumers are a major target consumer base. According to a poll conducted by The Washington Post and the Kaiser Family Foundation, close to half of the activists in the United States are 50 years old and older, with more than a third of those earning over $100,000 a year, and with four out of five having at least some college education. The activists of today are not scruffy, loud, and unprofitable. These activists in many ways represent a large segment of attractive and profitable consumers. They are wealthy and educated, energized and vocal; They want change, and many businesses are listening.
The purpose of this article is to keep you, the e-commerce owner or marketer, up-to-date on the issues that are playing the biggest roles in the ethical e-commerce trend. By the end of this article, you will know what issues to focus on, how your business (as well as the planet) can benefit from these practices, and the ways that e-commerce businesses around the world are already shifting their practices towards increased sustainability.
Ethical Issues in Ecommerce
1. Data Security and Privacy
Consumers are increasingly relying on online websites to make their purchases, so with the sheer amount of customer data now available to businesses and brands, security and the appropriate use of data have become some of the most important factors that consumers take into account, when choosing the business that they will purchase from. And, consumers have good reason to be wary. From 2016 to 2017, the amount of online fraud grew by 5.5 percent, and with large-scale data breaches—like the 2019 Capital One data breach, which affected approximately 30 percent of the American public—fresh in consumers’ minds, consumers are more likely to pay closer attention to how businesses are using and protecting their data.
In these circumstances, the ethical use of data can go a long way. The RSA Data Privacy & Security Survey 2019 shows that half (48 percent) of consumers believe there are ethical ways companies can use their data, while 57 percent would blame the company above anyone else—even a hacker—in the event of a data incident.
You might wonder how you would be able to make sure that your customers trust how you are using their data, and luckily, the answer is quite simple. The first step is transparency. Given that customers are trusting businesses with so much of their personal information, it is only reasonable that customers want to know how their data is being used and protected. Moreover, they do not want you to collect their data for collections’ sake. They want to know why you are using their data, and how it will benefit them. For example, increasing the personalized experience on a website will often be perceived as a justified use of consumers’ data.
The next step is to ensure that you are using the best software to protect your customers’ data. One great way that you can do this is to choose reputable payment gateways for your e-commerce websites, so that your customers do not only feel secure, they really are secure.
2. Increasing Sustainability
Sustainability encompasses a wide range of practices that a business can engage in, though the three core features include:
- Ensuring that your business makes use of fair trade materials and fair labor practices
- Ensuring that your company and material providers are respecting the earth’s natural resources
- Engaging in philanthropic outreach as a part of your business's mission
A great example of a sustainable practice that consumers will likely find attractive is given by the coffee company Verena Street Coffee, which sources its beans from 100 percent Rainforest Alliance Certified farms. These farms pledge to not only protect the wildlife and environment, but also the farmers and their families. Another example comes from the jewelry company Temples and Markets, which sells jewelry handmade by artisans and operatives in Southeast Asia, and has a company policy of being kind to the planet.
On the philanthropy side of things, the headband and accessories company, Banded, donates three meals to a child in need for every banded product sold.
These are just a few examples of the types of sustainable practices that consumer activists and socially-minded consumers are looking for, as ethical e-commerce practices.
3. Reduce Waste
Reducing waste can easily fit under the umbrella of sustainable business practices, but due to the monumental importance of reducing waste with respect to specifically e-commerce businesses, it deserves its own header.
Despite the growing “shop local” trend, people are purchasing online at an extremely high rate, giving consumers access to products from all around the world. However, the national and global nature of e-commerce which delivers products straight to people’s doorsteps means that there is much more fuel being burned, thus causing an increased amount of carbon dioxide to be emitted into the atmosphere. For the eco-conscious consumer, this is no small issue.
To offset this, carriers such as UPS have begun to offer carbon-neutral shipments. For a small fee added to your shipping charge, carbon-neutral shipments offer the most environmentally-friendly way to ship. This is not only good for the environment, but can also serve as great PR for your business, to be able to say that you are a “Carbon Neutral Business.”
Another great way to reduce waste is to introduce different packaging methods. The bigger the cardboard box you ship is, the more materials your customers have to stuff into their recycling bins. If your packaging is too large, or too difficult to break down and dispose of properly, it can easily end up as litter, or further the issue of landfills. In an effort to increase sustainability, many companies are using recycled, reusable, and biodegradable boxes. Even taking little steps like using less packaging tape can both reduce the amount of waste being put into the environment, and protect your pockets from overspending on packing materials.
Why You Should Go Sustainable
We can wrap up this article by summarizing some of the reasons that your business should go sustainable. The first is that it is quite possible that you will be forced to reduce your company’s environmental impact anyway. Consumer activism is reflected in the growing shift of the US towards more sustainable business practices, and the reduction of our carbon footprint. It is quite conceivable that waste standards and environmental footprint cautions may be put in place in the future.
The second reason is that it can actually save you money. Adding too much packing material to a shipment can add cost and weight, turning your operations into a losing equation for both your bottom line, and the planet.
Finally, and possibly most importantly, it can help your brand’s reputation and bring new customers. More and more, customers care about environmental stewardship and socioeconomic justice. Consumers want to shop with businesses that actively reflect the values that they believe in, meaning that a brand is no longer just a place where people buy things: A brand now stands for something. By making your brand something that consumers can believe in (and also integrate into the growing practice of pan-activism), your customers will be more loyal, and will be more likely to spread your brand through word of mouth. On top of all that, your customers may even be willing to take some of the costs upon themselves by paying a bit more, for the benefit of sustainability.