Owners of retail assets may be compelled to pursue sustainability initiatives in response to increasing energy disclosure regulations, investor pressure and even tenant demand. But until recently, there was scant data to help owners understand whether shoppers even noticed the green features of retail buildings and, if so, whether those initiatives impacted their loyalty towards certain retail projects.
By contrast, there is more data for office buildings, indicating that sustainable features can boost employee productivity and reduce sick days. Because staffing costs (salaries and benefits) account for 90 percent of a typical business’s operating costs, there can be an appreciable return on investment for companies that occupy green office space, which undoubtedly contributes to the 3 percent rental premiums and 13 percent sale price premiums that are paid for LEED or Energy Star-rated office buildings.
Now, for the first time, retail property owners have insight into the perspective of U.S. shoppers towards green buildings, thanks to a recent study by Forrester Research. The study includes a valuable breakdown by consumer demographics, and could help owners boost loyalty and create a competitive advantage for their projects.
Here are five key findings from the report:
- Approximately half of shoppers think sustainability is very important or extremely important. Forrester’s research found that on a scale of 1 to 5, with five being “extremely important,” 48 percent of shoppers ranked the environmentally-sustainable practices of stores and shopping centers as either a four or a five.
- Sustainability matters most to baby boomers, the wealthy, urbanites and women. Millennials often earn a reputation as the most environmentally conscious generation, but the survey found that of all age groups, shoppers over age 65 gave the highest weight to the importance of sustainable retail: 54 percent in this age bracket assigned it a ranking of 4 or 5. Owners of centers catering to urban or high-income shoppers should note that 52 percent of shoppers earning over $75,000 and 51 percent of urban shoppers ranked sustainability as at least very important. And finally, with women making the bulk of purchasing decisions for U.S. households, survey findings show that 51 percent of women surveyed rank environmentally-sustainable retail as very important.
- More than half of shoppers say they feel better about shopping venues that have sustainability initiatives. In addition to assessing the importance of sustainable retail to shoppers, the survey also assessed the impact sustainability has on brand and overall impression of retail properties. On a scale of 1 to 5, an impressive 37 percent of shoppers gave a score of 5 (indicating that they felt better about the shopping venue if it engaged in environmentally-sustainable practices), and 24 percent assigned a score of 4. For retail owners, this finding demonstrates that sustainability may be a way to enhance loyalty amongst today’s elusive shoppers.
- Nearly half of shoppers notice sustainability measures, particularly younger shoppers and those in urban settings. High-performance building features are often buried light fixtures, building control rooms or on rooftops, so the study next tried to assess whether shoppers even notice sustainable features when shopping: 53 percent of respondents said that they do. The majority of shoppers who noticed these elements were under age 34 and in urban markets.
- Recycling is the most noticed sustainability measure. Finally, the environmentally sustainable business practice that 69 percent of shoppers notice is recycling; followed closely by the sale of green products, at 66 percent, and then energy and water conservation at 57 percent and 45 percent, respectively.
In today’s competitive retail market, the results of this research should give owners of retail properties some insight and ideas to help maximize their brand and drive shopper loyalty and foot traffic. The full report can be accessed here.