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Oct 23, 2023

7 min to read

How Retailers & Brands Can Support a Circular Economy

Discover why sustainability has become a fundamental consideration for consumers and how leading brands are embracing the circular economy. Explore real-life examples from fashion, restaurants, electronics, and the automotive industry, and learn why providing accurate product information is the key to reducing waste and fostering a more eco-friendly future.


Customer Experience

Digital Commerce

Product Experience

Retail Trends


Sustainability is no longer just a buzzword; it’s a fundamental consideration for consumers. Research has shown that 35% of customers view sustainability as a critical piece of product information. Furthermore, a significant two-fifths of consumers are willing to pay more for brands that openly showcase their commitment to sustainability; on average, consumers are willing to pay 18% more for products from such brands.

One of the most popular ways brands and retailers have committed to sustainability is by participating in a circular economy; but what exactly does that mean, and what does it look like in practice?


What is a Circular Economy?

The circular economy is a transformative concept gaining momentum in the retail industry. Unlike the traditional linear economy, which follows the “take, make, dispose” model, a circular economy aims to minimize waste and maximize the lifespan of products and materials by providing a system for consumers to purchase and sell secondhand or previously purchased items.. It’s about keeping products, components, and materials in use for as long as possible, thus reducing the environmental impact of production and consumption.

At its core, a circular economy, redefines the way we view products, materials, and consumption. It’s not just about buying and discarding; it’s about extending product lifecycles, reducing waste, and reimagining the retail landscape in a more eco-friendly way.


Circularity at a Glance

The concept of a circular economy is not new, but it has gained substantial attention in recent years due to the pressing need for environmental sustainability. Key benefits behind this movement include reduced waste production, lower carbon emissions, and substantial cost savings. However, the benefits extend beyond the environment; they also include:

Increased Store Traffic: Customers are increasingly drawn to stores that offer drop-off points for their pre-loved items.

Reduces Return Rates: By extending the lifespan of products through resale or refurbishment, retailers can significantly reduce the number of returns, cutting down on waste and saving money.

Communicates a Shared Passion and Commitment: Participating in the circular economy sends a strong message that your brand cares about the environment, which can foster customer loyalty and attract like-minded consumers.

Upsell and Cross-Sell Opportunities: When customers bring in products for resale or recycling, retailers have an opportunity to upsell new items or cross-sell related products, increasing revenue.


The Circular Economy in the Market


Patagonia, a renowned outdoor apparel company, has long been committed to environmental responsibility, and their “Worn Wear” program is a testament to this commitment. This innovative initiative encourages customers to not only buy but also sell gently used Patagonia gear, thereby extending the life of their products and significantly reducing the demand for new manufacturing.

Here’s how it works: Customers who no longer need a Patagonia item can visit the “Worn Wear” website or physical stores to sell their used gear. Patagonia meticulously inspects these pre-loved items, ensuring they meet the brand’s stringent quality standards. Once approved, these items are made available for resale at a more affordable price, making it an attractive option for budget-conscious shoppers.

Patagonia’s Worn Wear program directly contributes to the circular economy by reducing the need for new production, resulting in lower energy consumption, fewer raw materials used, and decreased greenhouse gas emissions. It also aligns perfectly with the brand’s values of durability and long-term use, emphasizing quality over quantity.


Patagonia Worn Wear



The circular economy is not restricted to clothing and apparel; the mobile app Too Good to Go provides a unique perspective of the resale market for food, addressing the critical issue of food waste in the foodservice industry. Restaurants, cafes, bakeries, and other food establishments participate in this initiative by listing their surplus, unsold food at significantly reduced prices. This surplus food, often perfectly edible but unsellable due to factors like approaching expiry dates or excess prepared dishes, is rescued from the bin and offered to users of the app.

For restaurants, Too Good to Go provides an effective solution to the challenge of food waste. By selling surplus food instead of discarding it, businesses can recover some of the costs associated with food production and, more importantly, significantly decrease their contribution to food waste.

From an environmental standpoint, the app contributes to a reduction in greenhouse gas emissions and conserves valuable natural resources. Food that would have ended up in landfills, generating methane and wasting the resources used in its production, is diverted to consumers’ plates instead. 

The success of “Too Good to Go” highlights the willingness of both businesses and consumers to embrace circular economy principles and find practical solutions to global challenges. It’s a testament to how technology can drive positive change, fostering a sense of responsibility among restaurants and offering a sustainable and affordable option for consumers, all while making a significant impact on reducing food waste. 


Too Good to Go



In the electronics industry, there’s one behemoth that’s impossible to ignore: Apple. This tech giant has their own form of a circular economy with the Apple Trade-In Program, which offers customers an opportunity to exchange their old devices for new ones, a move that not only benefits the consumers but also makes a substantial contribution to reducing electronic waste.

The essence of Apple’s Trade-In Program lies in its simplicity and the win-win proposition it offers to customers. When a customer is ready to upgrade to a new Apple device, they have the option to trade in their old device, whether it’s a smartphone, tablet, or computer. The customer receives a credit or discount toward the purchase of the new device, effectively reducing the financial barrier to upgrading.

From a circular economy perspective, this initiative is highly impactful. It encourages the return of used electronics to Apple, where the company can assess, refurbish, and resell them. Extending the life of these devices is a significant step in minimizing electronic waste as it reduces the need for new device manufacturing and the extraction of valuable raw materials, conserving energy and resources while curbing the environmental impact of electronics production.

Apple Trade In Program



In the automotive industry, Tesla has not only revolutionized electric vehicles but has also set a remarkable precedent for sustainability through its innovative approach to reusing automotive parts. Tesla’s commitment to the circular economy can be seen in its practice of refurbishing and reselling old Tesla components, such as batteries and drive units. This approach not only contributes to sustainability but also plays a pivotal role in reducing the demand for new materials.

At the heart of this practice is the recognition that electric vehicle components, particularly batteries, have a considerable lifespan. Instead of disposing of older components, Tesla harnesses the potential for these components to be refurbished and reintroduced into the market. Tesla’s battery refurbishment program takes used battery packs, evaluates their health and capacity, and replaces any faulty cells or components. Once refurbished, these batteries are then made available for resale, often at a more affordable price than new ones. This extends the life of these parts and reduces the need for new manufacturing, a crucial aspect of the circular economy.

The reuse of drive units, a critical component in electric vehicles, follows a similar path. When Tesla owners need a replacement drive unit, they can choose to have their old one refurbished rather than replaced with a brand-new unit. This not only reduces costs for the consumer but also significantly contributes to the circular economy’s principles of extending product life and minimizing waste.

 By emphasizing the reuse and refurbishment of components, Tesla exemplifies how automotive manufacturers can contribute to a more sustainable future, reduce the environmental footprint of the industry, and promote a culture of responsible consumption.


Tesla Used or Trade-In Program


Why Creating a Circular Economy Starts with Consistent, Compelling, Accurate Product Information

To successfully implement a circular economy strategy, brands and retailers need to have precise, transparent, and compelling product information. This information guides informed consumer choices, fosters trust, enables reuse and refurbishment, minimizes errors and returns, and cultivates sustainability mindsets. Moreover, it ensures that products are effectively reused, refurbished, or resold, reducing waste and supporting the circular economy’s principles.

This information empowers consumers to make conscious decisions, allowing them to evaluate the value and environmental impact of products, ultimately leading to reduced waste and an increased commitment to sustainable practices. In addition to individual benefits, it builds trust between brands and consumers and contributes to the broader shift towards a more environmentally responsible and circular approach to product consumption.:

In a world where sustainability is paramount, the circular economy emerges as a powerful approach for retailers across a number of industries. By embracing the circular economy, brands can increase customer loyalty, reduce waste, and contribute to a healthier planet.

 The key to a successful transition to a circular economy lies in the provision of accurate and compelling product information. With customers increasingly prioritizing sustainability, the circular economy is not just a trend but a necessity for businesses to thrive in the future. It’s a win-win situation, benefiting both the planet and your bottom line.

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