From Michael Hill to Adorn Cosmetics: Aussie brands paving the way for sustainable business practices
The third Power Retail Sustainability Report has been released, revealing key consumer trends and the brands that are pivoting to meet them.
The third Power Retail Sustainability Report has been released, revealing key consumer trends and the brands that are pivoting to meet them. Amongst other findings, this year’s report indicated that 56% of Australians consider how sustainable a brand is when making purchases. And over 69% of Australians believe the retail industry creates too much waste.
So, which Australian retailers are responding to the push for sustainable purchasing options and why?
In a recent interview with SmartCompany Plus, Power Retail founder Grant Arnott spoke about the report’s findings. And Daniel Bracken, CEO of Michael Hill Jewellery, and Briony Kennedy, founder of Adorn Cosmetics, joined the conversation.
Australian consumers are prioritising sustainability
Compiled with the help of sustainability consultants The Purpose Agents, this year’s Power Retail Sustainability Report surveyed 53 businesses and spotlights the top retail achievers in eight categories:
- Circularity (Michael Hill Jewellers),
- Stewardship (Adorn Cosmetics),
- Reconciliation with Aboriginal and Torres Strait Island communities (Modibodi),
- Driving systemic change (Country Road),
- Diversity and inclusion (Lenovo),
- Ethical sourcing and transparency (Princess Polly), and
- Waste reduction (Officeworks).
The report also highlights and tracks key consumer trends related to sustainable purchase decision-making.
In the 2023 report, cost of living factors are believed to be contributing to a reduction in consumer willingness to pay more for sustainable products, with 54% of consumers saying they would be willing pay a premium for sustainable products (an 8% reduction). Despite this decline, more than half of Australians (56%) take sustainability into consideration when making purchases and 46% prefer to shop with retailers that are transparent about their sustainability practices.
Packaging was a key concern for ethical shoppers, with waste reduction cited as a key factor influencing purchasing decisions. Animal welfare and brand transparency are the other top facts influencing consumer purchasing decisions.
Importantly for retailers, 49% of customers said it was likely they would repeatedly shop with a retailer that had sustainability practices they approve of, indicating eco-friendly initiatives help retain customer loyalty.
“I think consumers are really trained now to think, ‘Does this retailer have any sustainability credentials?’,” Grant Arnott, Power Retailer’s founder, explains. “And when consumers are looking at two different choices with a similar price point, they’re increasingly choosing to buy the product with more sustainable credentials.”
Excellence in circularity
In response to the growing demand for sustainable product choices, and proving that sustainability and loyalty go hand-in-hand, Michael Hill Jewellers has introduced a new Re:cycle program with great success. The program allows customers to recycle unwanted gold in return for Michael Hill gift vouchers, earning the chain jewellery store a feature in this year’s report for the circularity category.
“Jewellers have always had elements of circularity in their business models that other retailers don’t offer,” says Daniel Bracken, Michael Hill’s CEO. “You can resize your ring, put stones into alternate settings, or repair things. And that’s because we use natural resources that can be repurposed multiple times, but this approach to circularity was mainly in independent jewellery stores. At Michael Hill, we’re taking that inspiration and applying it to our whole supply chain and putting the offering front and centre so that our customers can take their old products and make them shiny and new again. Our focus is on doing the right thing and taking a leading position to help the planet, but it’s a change that’s now attracting a new customer type to our brand.”
Source: Supplied
Despite only launching a few months ago, the Re:cycle program has exchanged $200,000 worth of store vouchers for gold. By returning the gold to the global supply chain, Michael Hill Jewellers has prevented 5,996 tonnes of mining ore extraction and 32 tonnes of carbon emissions.
To take their circularity vision even further, Michael Hill will launch a diamond exchange initiative called Re:imagine later this year. The program will allow customers to exchange diamonds for a better quality or size.
“We’re also changing to use Australian-mined gold because the standards and conditions of Australian mines are far superior to most other countries in the world,” Bracken says. “And we’re introducing recycled gold and silver into our business in a much more prominent way over the next 12 months. Our whole supply chain has been reimagined in the way we bring products to market.
“We’re seeing a new customer type that really does care about sustainability and wants to understand where their product comes from and the transparency of the supply chain.”
Adorn: Leading the way with environmental stewardship
For 15-year-old cosmetics brand, Adorn Cosmetics, sustainability has been at the heart of the business since inception. The brand specialises in refillable Australian-made cosmetics and beauty products and has continuously prioritised sustainability over growth and profits.
“By selling our products exclusively online, we can sell them without packaging. But if we took them into a department store, we would need to put the products into boxes and plastic wrapping,” Briony Kennedy, Adorn’s founder explains. “By staying online, we’ve prevented the production of hundreds of thousands of pieces of unnecessary packaging because my whole philosophy is to avoid making things that aren’t needed. It would have been quicker to grow the brand through more traditional methods, though.”
Briony Kennedy, founder of Adorn Cosmetics. Source: Supplied
Adorn’s commitment to environmental protection earned them a spotlight position in the Power Retail Sustainability Report for stewardship. Power Retailer’s founder, Grant Arnott, commended Adorn on the achievement saying: “It’s really commendable to see a small family-run business dedicating that amount of effort to sustainability”.
Adorn not only offers refillable sachets instead of brand-new cosmetic pots, it also encourages recycling by taking back consumer waste and only manufacturing in small quantities. The brand’s commitment to sustainability has undoubtedly contributed to its loyal following, but it’s not the only reason. “Some customers are loyal to us simply because we’re Australian-made,” Kennedy says. “Other people support us because we’re a kind brand – kindness is at the roots of everything we do, from the ingredients we use to how we treat our staff and customers, as well as how we prioritise the environment.”
For the brands who weren’t spotlighted in this year’s Power Retail Sustainability Report, Arnott says they still have an opportunity to “ask us questions and look at how they might improve their practices.” The report also allows other retailers to consider the benefits of investing in sustainable practices.
“We all know that the bottom line is the key concern of a business, but it has been proven multiple times now that investment in sustainability can actually work to benefit the bottom line,” Arnott says. “Investment in sustainability can improve customer loyalty while also reducing a retailer’s waste and the associated expenses. And, the cost of sustainability-related initiatives is coming down as they become more mainstream, so we certainly haven’t seen any indication of retailers slowing down their adoption of these practices despite consumers being impacted by the higher cost of living.”
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