Retail is undergoing a profound transformation. While omnichannel strategies have become table stakes—seamlessly connecting digital and physical experiences—the next frontier is circular commerce. This model reimagines the entire retail value chain, embedding sustainability, reuse, and resilience at its core. For retailers, circular commerce is not just an environmental imperative; it’s a strategic lever for profitability, differentiation, and long-term growth.
Consumers and investors are demanding more from brands. Shoppers want to align their purchases with their values, seeking out companies that prioritize environmental, social, and governance (ESG) goals. Investors, meanwhile, are scrutinizing sustainability metrics as indicators of future resilience and value creation. Retailers that move beyond incremental improvements—such as reducing packaging or offering recycling bins—toward holistic, circular business models are poised to lead in this new era.
Circular commerce is a business model where products, supply chains, and customer experiences are designed for longevity, reuse, resale, and regeneration. Rather than the traditional linear model of “take, make, waste,” circular commerce closes the loop:
IKEA’s ambition to become a fully circular business by 2030 is a benchmark for the industry. The company has given 47 million products a second life, resold 38 million items, and repacked millions more. By transforming stores into fulfillment centers and leveraging real-time data, IKEA avoided building 15 new distribution centers—delivering both cost savings and a reduced environmental footprint. Circularity is not a side project; it’s embedded in IKEA’s core business, creating new revenue streams and deepening customer engagement.
Target’s approach to circular commerce is rooted in personalization and loyalty. Through programs like Target Circle 360, the retailer offers personalized product recommendations and exclusive deals, driving both retention and acquisition. Target’s expansion into wellness and sustainable product lines—such as the Good & Gather brand—demonstrates how circularity and ESG can fuel growth. By integrating digital tools and real-time data, Target tailors experiences and promotions, making sustainability accessible and relevant to every shopper.
Circular commerce is powered by data. Real-time analytics, AI, and cloud technologies enable retailers to:
For example, advanced AI can forecast which products are likely to be returned, resold, or recycled, allowing retailers to route items efficiently and maximize value recovery. Customer Data Platforms (CDPs) break down silos, providing a unified view that supports hyper-personalized, sustainable journeys across all touchpoints.
Circular commerce unlocks new sources of value:
Brands that lead in circular commerce stand out. They build trust by demonstrating real impact—reducing waste, lowering emissions, and empowering customers to make sustainable choices. This differentiation is not just about marketing; it’s about delivering tangible value to customers, communities, and shareholders.
The future of retail is circular, digital, and customer-centric. By integrating ESG goals with digital transformation, retailers can:
Publicis Sapient partners with retailers to design and implement circular commerce strategies—combining deep sector expertise, proven frameworks, and a relentless focus on business outcomes. The opportunity is clear: those who embrace circularity today will define the future of retail tomorrow.
Ready to build a resilient, profitable, and eco-friendly retail business?
Contact Publicis Sapient to start your circular commerce journey.