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Researchers Compare the Carbon Pricetags of In-Store and Online Purchases

Mary Catherine O'Connor | Monday December 14th, 2009 | 8 Comments

online-shoppingFrom a carbon emissions point-of-view, is it better to buy products online or in a store? You probably guessed the former. And if so, you’re right, according to a study conducted by MindClick GSM, a sustainability consulting firm and released today by GigaOM Pro, a subscription based research and analysis service covering green IT (among other topics).

MindClick decided to use the two biggest shopping days of the year—Black Friday and Cyber Monday—as a launching point for their research. The National Retail Federation conducted a survey late last month in which it asked consumers about their anticipated spending over the Thanksgiving weekend. The results showed that, on average, consumers would spend $343 inside stores and $104 through online purchases.

The researchers took these numbers and ran with them, calculating that the negative environmental impact of an in-store purchase made on Black Friday is 50 times that of an online purchase made on Cyber Monday. And in more general terms, it found that carbon emissions related to purchasing an item inside a store represents an increase of more than 15 times that of an online purchase.

The researchers based their emissions reporting on the Economic Input-Output Life Cycle Assessment (EIO-LCA) model   which uses very broad economic and environmental data and is not suited for “micro-level analysis,”  according to the report.

The study makes a number of assumptions that would be interesting to pursue further. For example, in its model, it assumes the online purchases are delivered via the US Postal Service and that the USPS has an emissions profile similar to that of other delivery services, such as UPS and FedEx. But that comparison seems valid only if one considers the emissions from drive-to-home deliveries via truck, rather than packages small enough for a carrier to handle and take on a delivery route, which could entail more driving and stop/go than the latter.

Also, it did not consider the emissions associated with an ecommerce computing network. Certainly this could be a major source of emissions that are not being counted. The reason it was skipped? The EIO-LCA model “would have required additional data that were not readily available,” says the report.

What this means is that when comparing in-store and online shopping, the considerable energy requirements to maintain a retail store and the emissions resulting from driving to and from that store (it assumes a twenty-mile round trip with two shoppers in the car) are compared only to the shipping of an online purchase.

The researchers also excluded packaging materials from the analysis, saying that for a single item purchased in a store, a plastic bag would likely be provided. The same purchase shipped through an online purchase would incur a cardboard box and air pillow. It seems as though the research would benefit from a deeper dive in this and other areas, though the researchers do say that even if  emissions related to travel to get to and from a store were not counted (say the shopper walked or rode public transit), the emissions associated with in-store shopping would still be higher, thanks to the environmental impact of maintaining a brick and mortar store.

This may be true, but the report points out that there is also an important relationship to remember between real and virtual stores: in most cases, online stores would not exist were it not for their brick and mortar brethren. It says:

With some notable exceptions such as Amazon, many of the successful online retailers have a network of retail locations, which have been central in building the brand for the customer. Without the presence of retail locations, many customers would not patronize the stores online, so the interdependency of the two purchasing options should not be discounted.

In light of that fact, retailers with both physical and online stores have a balancing act to perform in terms of maintaining a brand and its physical presence on one hand, and doing a good job of serving up products online, on the other. Leading retailers are already doing this—not necessarily as a strategy for sustainability but as a means of surviving this tough economy.

If you’re interested in the GigaOm Pro report, don’t worry, you won’t have to drive to the store. It’s available online, here, through the $79 yearly subscription to the research service.


▼▼▼      8 Comments     ▼▼▼

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  • vvtempo

    Wow, this is a good thing. Sounds like fun!

    Jess
    http://www.total-privacy.es.tc

  • salvadorrusso

    More and more evidence that shows our economy moving online. Please be sure to check out my online retail site Lotus Link and what it has to offer. I'm following you guys on Twitter. Bravo!

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  • Nhac

    EIO LCA is based on data that is so poor that the results could be wrong in orders of magnitude. A 50 times difference is well within the error bars, therefore the study is meaningless.

    • mcoc

      Nhac: You piqued my curiosity. Why do you say EIO LCA is based on poor data? I thought it was just a model and therefore the data would be different in each new application.

    • http://twitter.com/timeaswine Time As Wine

      The study was quite interesting, I wouldn't say that it is based on poor data. There's always some limitation in doing a study.
      Another point that could be added here is the online store will require less man power to run.

  • rarefinds2

    Quite interesting facts. I sell for the only carbon neutral company in the world. I'm an Independent Shaklee Distributor selling all natural vitamins, cleaning products, beauty products and more. Please check out my website to find out how you can help the environment by using their all natural cleaners and more.
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  • http://twitter.com/greysma Grace Ma

    The best way to reduce GHG emissions is to reuse and buy less stuff. This study is inconclusive since they didn't account for significant factors like packaging, ecommerce computing network, and delivery methods. Kudos to the author for her clear analysis.

  • http://twitter.com/greysma Grace Ma

    The best way to reduce GHG emissions is to reuse and buy less stuff. This study is inconclusive since they didn't account for significant factors like packaging, ecommerce computing network, and delivery methods. Kudos to the author for her clear analysis.

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