How green is e-commerce?

Although technology is generally seen as a bad thing when we talk about 'Saving the Planet' (think long and short haul flights, TVs and electronic gadgets burning fuel when left on standby), perhaps e-commerce does have some upsides.

Think about online shopping – imagine a situation where we no longer travelled to the shops and 100% of items were efficiently delivered to us at home or at work. This would reduce traffic considerably! Although this situation is inconceivable since most of us enjoy shopping in the Real World too much, online shopping is growing considerably and it may be having an impact.

Research by the Internet Media in Retail Group (www.imrg.org) shows the growing importance of E-commerce in the UK. They estimate that:

• £30 billion of retail spending is online
• 10% of retail sales now take place online
• e-retail sales have grown at an average year-on-year rate of 45% for the past 6 months
• e-retail sales have grown 2,000% in 6 years
• 44% of shoppers polled expect their online shopping to increase in the next 12 months
• 540 million parcels will be shipped to the UK's 26 million internet shoppers in 2006

The figures are impressive but does this make any difference in reducing our shopping trips or have broader impacts? Well it might.

The IMRG certainly wants us to believe online shopping is green; in the summer it launched a GO GREEN, GO ONLINE campaign. It identified six reasons why it believes e-commerce is green. They are:

Green effect - 1. Less vehicle miles

Shopping is the most frequent reason for car travel in Great Britain, accounting for 20% of all trips, and for 12% of mileage.

Green effect - 2. Lower inventory requirements

The trend towards pre-selling online – i.e. taking orders for products before they are built, as implemented by Dell - avoids the production of obsolete goods that have to be disposed of if they don't sell.

Green effect - 3. Less printed materials

Online e-newsletters and brochures replace their physical equivalent so saving paper and distribution costs. Direct mail volumes have fallen slightly in the last two years. This must be partly due to marketing emails which the DMA email benchmarks show number in their billions in the UK alone.

Green effect - 4. Less packaging

Although theoretically there is less need for fancy packaging if an item is sold online this argument is less convincing, since most items like software or electronic items still come in packaging to help convince us we have bought the right thing.

Green effect - 5. Less waste

Across the whole supply chain of procurement, manufacturing and distribution the Internet can help reduce product and distribution cycles.

Green effect - 6. Dematerialisation

Better known as digitisation, this is the availability of products like software, music and video in digital form.

Next month, Dave looks at how e-commerce could reduce greenhouse gas emissions and how problems with order fulfilment can damage the green status online shopping might enjoy.

The unedited version of this article, citing all references, appears on Dave Chaffey's e-business and web marketing website.

Dave also offers online advice on email marketing in his Email Marketing Strategy Guide