In new Europe-based research, Visa reveals that the cost-of-living crisis and impacts of climate change are causing people in the UK to rethink their current purchasing habits and look for more sustainable ways to buy and sell products and services.
The survey, conducted by Opinium, found that 90 percent of consumers surveyed across the UK have already participated in at least one Recommerce activity: a more regenerative way to buy, reuse and share goods and services. However, there is a lack of understanding among consumers that many of their behaviors are already working towards a more sustainable future and by adopting these behaviors more often will accelerate changes in this area.
The 6 Rs
Recommerce behaviors which include Resale, Refill, Repair, Rental and Return and Redistribute—defined as sharing, exchanging or selling at lower prices things that one no longer needs or has too much of—are referred to by Visa as the six Rs.
Out of the six Rs, Resale is the most well-known and understood of all the behaviors with over 47 percent of consumers reselling goods at least twice a year. Over one in five (23 percent) of small businesses in the UK already provide Resale options with 37 percent planning to do so in the future. Over a quarter (29 percent) of consumers are motivated to pay for items to be repaired, refurbished or adapted as it will save them money in the long term.
Consumers are the most motivated to engage in Repair to extend the life of high-quality products. Refill is used by consumers to cut back on waste, with 20 percent of those who participate doing so as it fits with their values. Return includes taking or accepting products back at the end of their life cycle, and alongside resale, is one of the most likely activities to be provided by UK businesses.
Consumer motivations spur the rise of the Environmental Entrepreneur
The study shows that recognizing the financial opportunities for the business savvy and understanding the potential for cost savings are key to encouraging Recommerce: 32 percent of adults surveyed said that they would take part in Recommerce activities more frequently if they could find a way to make money from their actions, such as setting up an app to sell used clothing or furniture or receiving cash incentives to redistribute surplus food. Indeed, already over half (53 percent) of UK adults who participated in Recommerce say they have already saved money through it.
Environmental benefits are also a key driver for consumers. Visa has found that over four in five of adults in the UK have actively taken part in environmentally friendly activities over the past three months, with the vast majority (90 percent) stating that they felt that using less packaging has an impact on the environment and society. As 40 percent identified reducing waste, packaging or plastic as the main reason for taking part in the Recommercial economy, it is clear that the combination of environmental concerns, and costs are driving Recommerce uptake.
As a global payments network, Visa intends to make it easier, more rewarding, and more accessible for people and businesses to consider Recommerce in their daily choices. Working with Strategic Partners such as the Ellen MacArthur Foundation, an international charity that develops a promotes the circular economy—which is designed to eliminate waste and pollution, circulate products and materials, and regenerate nature—Visa is striving to help accelerate the transition towards a more regenerative circular economy.
Visa has created a new digital Recommerce space to help individuals and businesses learn more, with educational resources on how to adopt the six R’s of Recommerce: Resale, Repair, Rental, Refill, Return and Redistribution. As a next step, Visa is set to develop a behavioral insights lab. Through experimentation and working with clients and partners to uncover findings, the lab aims to uncover actionable ways to implement real-world solutions and empower individuals to adopt more sustainable behaviors in their everyday life.
“The new Behavioral Insights Lab will conduct experiments to further this ambition, with the Ellen MacArthur Foundation ensuring its Circular Design Principles are incorporated and that pre-competitive opportunities may be advanced through its network,” said Joe Murphy, Executive Lead, Network, at the Ellen MacArthur Foundation, in a news release.
“It’s inspiring to see that UK consumers are leading the way in taking up Recommerce behaviors, and their appetite to learn more about sustainable spending,” said Mandy Lamb, Managing Director, UK&I at Visa, in the release. The shift from a linear to a regenerative economy requires big societal change, but by setting expectations high and rethinking our habits with the help of education, we can all achieve this shift to a more sustainable future. Through Visa’s Recommerce behavioral insights lab, we are excited to work with partners to uncover real-world solutions that will empower individuals to make the circular economy a bigger part of everyday life.”
Opportunities for small businesses—Recommerce proven to boost business
As consumer preferences change, so to do the opportunities for businesses. By 2030, it is estimated that the transition to a circular economy in the UK will be a £82 billion economic opportunity, with the data indicating this is already being felt by businesses. UK small businesses report that offering Recommerce has correlated to business growth, reporting their revenue has grown on average 17 percent in the last 2 years, with cost savings around 12 percent. Most consumers (55 percent) indicated that they were more likely to buy products or services from businesses that help them to participate in Recommerce activities, shooting up to 63 percent among 18-34-year olds. This is being noticed by businesses, as 37 percent have said customer demand was the main motivation behind offering a Recommerce model.
However, while the future of sustainable business practices is promising, participating in the Recommercial economy is not yet commonplace: 38 percent of adults that stated that will do so once activities become easier and more convenient to use, and over half of those who have taken part (51 percent) said their motivation was around reducing clutter over more sustainability focused priorities.
Research commissioned by Visa and conducted by Opinium with 8,000 European consumers and 2,000 European SMB decision makers, between 19th October 2022 and 25th October 2022. The data was collected using an online survey in the UK, France, Germany and Poland.