The giant furniture retailer is using its procurement clout and in-store promotions to nudge millions of customers toward lower-emissions products. Close to 860 million people visited Ikea stores last year, helping it generate more than $50 billion in sales. The world’s largest furniture retailer is using that exposure to drive a unique net-zero goal: a pledge to cut the climate footprint from products Ikea customers use at home by 70 percent by 2030. So far, Ikea has managed a 52 percent reduction to the baseline it set in 2016, according to Ikea’s sustainability report for 2023. The retailer calculates that claim by looking at the material composition and energy efficiency of the appliances, lighting and furniture it sells. In FY2023, for example, Ikea sold more than 58.1 billion LED light bulbs. Switching to an updated product improved the portfolio's efficiency by 6 percent, reducing customer energy consumption and emissions in the process. Some stores haven’t carried incandescent alternatives in close to a decade. That reduces consumer power consumption and, by association, their emissions. Ikea can nudge consumers toward products with lower emissions by using its scale as a buyer to make sure that greener products don’t require a price premium, said Karen Pflug, chief sustainability officer of Ingka Group, the largest Ikea retail franchisee accounting for 88 percent of its sales. She leads strategy for close to 400 stores, which hosted 697 million visits in Ikea’s 2023 fiscal year. “There’s many cases where, actually, we can really drive industry-wide change,” Pflug said during the launch episode of GreenBiz’s Climate Pioneers, an interview series showcasing corporate climate innovators. “By having the size and volumes and guaranteed revenue for suppliers, that helps us change the production line.” Ikea didn’t invent LED lighting for instance, but because it ensured certain volume levels, it changed priorities for... |