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IBM Showcases Sustainable Solutions at NRF 2022

RETHINK Retail caught up with Luq Niazi, Global Managing Partner, Industries for IBM Consulting, at NRF 2022 to learn more about how the global tech company is helping businesses optimize their operations to become more sustainable.

2022 is the year that we all need to rethink our environmental impact. Hear more about how IBM is empowering a resilient and sustainable future with its AI-powered sustainability solutions.


Luq Niazi:
I’m here at NRF to help retailers and their partners and suppliers really help transform in this age of significant transformation. I want to go back to 2020 when we first surveyed the industry. At that time we found this new group, the purpose-driven consumer. They were the group that seemed to care more about sustainability, recycling, circular economy. And at that time, it was 37% of the respondents were purpose-driven, just four points behind the value-driven consumers that of course we’re all very familiar with.

Two years on, we wanted to see how that had changed through the pandemic. And really significantly, purpose-driven consumers are now 44%. That’s 10 points increase, compared to 37% for the value-driven consumers. So they are the biggest group out there.

Purpose-driven consumers, they are really looking for retailers to be able to demonstrate that the goods that they’re buying are sourced, manufactured, distributed, and ultimately fulfilled in a sustainable way. Therefore, connecting all of that information across the value chain in the consumer buying experiences is first and foremost the highest priority.

But the second key thing that we found through the survey was that while purpose-driven consumers were prepared to pay more … In fact, that’s jumped from 35% percent for those who are most keen on purpose-driven consumption to a significant 70%, there’s an intention gap. What I mean by that is they’re not able to complete their purchases in a way that is sustainable. About 31%, less than a third, are actually able to do that.

So the next key piece, therefore, for the retailers is to really be able to bring all of their information together in an easy and really consumable way, such that they can make those choices as they go and fulfill their intent.

At IBM, we are looking to do it in two key ways. First of all, from our technology. So of course we have a significant applications portfolio. And over the last years, we’ve been shifting that towards an ever-increasing focus on sustainability. We do that in two ways, an environmental information suite that’s built on our weather company, assets and complemented with capabilities such as our recent acquisition of Envizi, but also, and very importantly, our supply chain suite, where we’re truly integrating our supply chain capabilities, whether that’s supply chain control tower, supply chain visibility, planning and optimization with our blockchain transaction engine for supply chain. That’s the engine that powers platforms like Food Trust.

What’s really important about that last piece is that making sustainability come together is about tracing sustainability at each stage. So if you can trace safety at each stage, well, then you can trace sustainability, whether it’s CO2, plastic, water, et cetera. So those are the two technology capabilities. And of course, we complement that with our consulting capability, with our green to grow practice focused on green or sustainability garages, and then using agile transformation to drive that through initiatives. Again, ultimately ending in the supply chain

IBM’s top recommendations for retailers, for serving consumers and their changing preferences for sustainability and purpose-driven goods. First of all, establish trust. Make sure that you are bringing all of the good work that we know you are doing throughout your value chain. So get that data that gives you that transparency and traceability and bring it to life in your shopping experience in any way that you engage with your customer.

Secondly, I would say, make it easier to understand, there’s a lot of new standards coming out, whether it’s standards around plastic or transportation, or other aspects of sourcing. And honestly, when you’re buying, do you have time to see all of that? So how make that information come together in a easy way? I believe that a simple scan of a QR code or the equivalent that gives you all of that insight might be an answer to that particular piece.

And then, thirdly, really understand where your consumers are. As I’ve said, in terms of this study, it’s a very big shift towards sustainability, but how well are you connecting to that, and how well are you building a 360-degree experience for your consumers to really understand how you can best serve them in their desires to be value driven.