Green Retail Initiatives Seen Driving Down Costs and Catalyzing Customer Loyalty

Best-in-class performers achieve top-line revenue growth and bottom-line cost savings while boosting customer loyalty, Aberdeen reports

Boston — August 18, 2008 — Competition, rising costs, brand loyalty and innovation pressures are the key drivers pushing retailers to pursue green initiatives, according to a recent report from technology consultancy Aberdeen Group.

After surveying over 100 retailers focused on leveraging sustainability initiatives to increase customer loyalty, Aberdeen published the report "Getting from Green to Gold: Retail Success Factors and Outcomes," which outlined information revealed from retail executives about their green and sustainability agendas, priorities and strategies across all areas of the retail enterprise from the supply chain and headquarters to stores and facilities.

The top pressures driving companies to focus on green/sustainable supply chain programs today, according to the survey results, are the desire for competitive advantage (57 percent of companies), the need to control rising energy costs (38 percent of companies), the need to improve brand value and equity (34 percent of companies), followed by the need for innovation (31 percent of companies) and pressure around present or expected compliance mandates (30 percent of companies).

Survey results show that the firms enjoying "best-in-class" performance shared common characteristics involving various aspects of strategy, reporting, visibility and technology. Results show that:

  • Retailers defined by Aberdeen as "best-in-class" achieved a 20 percent decrease in energy costs.
  • Best-in-class retailers achieved an 8 percent decrease in their overall logistics and transport costs.
  • Best-in-class retailers achieved a decrease of 5 percent in merchandise costs.

Additionally, the best-in-class achieved significant improvements in customer loyalty as measured by improved rates of customer acquisition (+17 percent), customer retention (+31 percent) and customer satisfaction (69 percent of best-in-class with customer satisfaction rates above 80 percent).

According to Jhana Senxian, sustainability and corporate responsibility specialist at Aberdeen and author of the report: "Sustainability is as much about change in organizational culture as it is about process transformation. Accordingly, vision, leadership, education and communication are as important as processes and technology. To be successful, companies must be visionary, holistic and quantitative in approach."

A free copy of the report is being made available, in part thanks to underwriters Enablon, HCL and SAP, at

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