The ecommerce software provider defined the holiday season as Nov. 1 through Dec. 31. Year over year, Salesforce said, global online sales grew 3%. Moreover, the global average discount rate across the entire holiday season was 21%. That’s the highest it has been since 2020, Salesforce said. Salesforce uses data from more than 1.5 billion global shoppers.

In North America, 76 of the top 2000 online retailers use Salesforce as their ecommerce platform, according to Digital Commerce 360 data. In 2022, those 76 online retailers combined for more than $116.97 billion in web sales.

Meanwhile, U.S. online holiday spending reached $221.1 billion, according to data from Adobe Analytics.

How much did global ecommerce sales grow during the 2023 holiday season?

By week, the largest sales growth during the holiday season was a tie between Cyber Week (the week encompassing Thanksgiving, Black Friday and Cyber Monday) and pre-Christmas, according to Salesforce data. Each of those weeks grew sales 6% year over year, Salesforce reported. The next-highest sales growth (4%) was in the first week of November. Christmas-week sales growth declined 4% year over year.

Based on Salesforce’s data, order growth was correlated with sales growth during the 2023 holiday season. Cyber Week and pre-Christmas week each recorded 6% year-over-year order volume growth in 2023. Meanwhile, order volume during the first week of the holiday season grew 2% year over year, Salesforce said. Christmas-week order volume declined 6%.

For the holiday season as a whole, order volume grew 2% year over year, Salesforce said. That correlated with 2% year-over-year growth in units per transaction growth, and the increase in average selling price was 0.7% year over year, Salesforce said.

How popular was store pickup in the 2023 holiday season?

Each week of the 2023 holiday season, at least 22% of orders were picked up at stores, Salesforce found — or more than one out of every five orders. That grew to at least a quarter of all orders from the week after Thanksgiving through Christmas week, according to Salesforce, with about a third of orders (33%) being picked up at stores during Christmas week.

Share of online orders picked up at store during the 2023 holiday season, according to Salesforce.

Mobile shopping trends during the 2023 holidays

Traffic to mobile devices grew year over year during each week of the holiday season, Salesforce said. The largest growth in mobile traffic, 10%, was during Cyber Week. The first week of the holiday season, post-Cyber Week, and the week before Christmas each recorded 9% growth in mobile traffic, according to Salesforce.

In contrast, desktop web traffic decreased each week of the holiday season, Salesforce found.

What channels drove the most online traffic through the holiday season?

Each week of the holiday season, direct traffic accounted for the largest source of online retailers’ global website visits. From Nov. 1 through the end of December, Salesforce data shows, direct traffic accounted for 37% of all visits to online retailers’ websites, with three exceptions. During and directly preceding Cyber Week, that traffic source bumped up slightly to 38%. On Christmas week, it dipped slightly to 36%.

Search traffic accounted for about a third of all website visits throughout the 2023 holiday season, Salesforce found, hovering between 31% and 33% each week. Internal traffic accounted for 14% to 15% of visits each week during that time frame, and traffic from social media platforms combined for 10% to 11% of total visits each week. Advertising and email traffic each accounted for just 1% of global visits to online retailers’ websites.

Global web traffic growth from social media platforms grew 10% year over year in the first week of the 2023 holiday season, tied with the mid-season week halfway between Cyber Week and Christmas. Such traffic from social media platforms was its lowest during the holiday season during Christmas week (4%).

Advertisement traffic growth increased the most in the mid-season week (27%) and the week before Christmas (23%). The week before Thanksgiving, advertising traffic growth decreased 4%, the only week with negative ad traffic growth during the season.

Email and direct traffic were the only other channels to have negative growth during the 2023 holiday season, according to Salesforce data. Email traffic growth decreased 2% the week before Christmas, with a larger drop (-16%) during Christmas week. Direct traffic growth also decreased year over year (2%) during Christmas week.

How did returns factor into the 2023 holiday season?

Salesforce data shows that returns during the 2023 holiday season were largely consistent with the 2022 season. The percentage of orders consumers returned each week was essentially flat, with the exception that they grew to 19% during Christmas week in 2023, compared with 16% in 2022. They also grew slightly in the second week of November 2023 (11%) compared with the same week in 2022 (10%).

Share of orders consumers returned during each week of the holiday season in 2023 and 2022, according to Salesforce data.

Returns dipped slightly to 10% during the first week of November 2023 from 11% in 2022, and to 4% during Cyber Week 2023 compared with 5% in 2022.

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Trends and Facts from the Next 1000 Hardware & Home Improvement online retailers:

• Next 1000 Hardware & Home Improvement online retailers grew online sales 6.8% in 2022.
• Next 1000 Hardware & Home Improvement online retailers sold over $1 billion online in goods in 2022.
• Total retail sales for Hardware & Home Improvement in the U.S. grew 6.3% in 2022.
• Total retail sales for Hardware & Home Improvement in the U.S. reached $530 billion in 2022.

Top 5 online retailers in the category:

• Tekton Inc. (No. 1,007)
• In the Swim (No. 1,008)
• Stark Bro’s Nurseries & Orchards Co. (No. 1,020)
• Cyberweld (No. 1,034)
• Proven Winners LLC (No. 1,044)

Shopper demographics in the category:

• Ages 18 to 24: 12% of shoppers
• Ages 25 to 34: 20% of shoppers
• Ages 35 to 44: 19% of shoppers
• Ages 45 to 54: 18% of shoppers
• Ages 55 to 64: 18% of shoppers
• Ages 65 and up: 14% of shoppers

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Signifyd provides fraud prevention services to web merchants. Its network includes 115 retailers in the 2023 Digital Commerce 360 Top 1000 ranking of North America’s leading online retailers.

Across Signifyd’s network, fraud attempts are 20% lower compared to the 2022 holiday season, says J. Bennett, chief customer officer at Signifyd. He says that’s because last year, there was a big and sophisticated wave of fraud attempts engineered by a crime ring in Southeast Asia, and that has not been repeated this year.

“Last year was the first time we saw a pretty broad-based attack during the holidays,” Bennett says. “This year, we’re seeing measurable levels internationally, but not in the U.S. market.”

Signifyd estimates U.S. online retailers lost $660 million in fraud in November 2022 alone, mostly theft of such high-end items as:

• Laptops
• Mobile phones
• Computer chips
• Gaming devices

2023 Top 1000 Report

Analysis of North America’s leading 1,000 online retailers. Includes over 200 charts, rankings by 2022 web sales, benchmarking data, growth analyses by category and merchant type, and a detailed analysis of post-pandemic ecommerce. 

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Meanwhile, Signifyd says online sales for the season are up about 6% compared to last year. That estimate is generally in line with ecommerce sales data from Adobe Inc. and other ecommerce technology providers.

Online retailers are upbeat about holiday sales

With supply chain snarls that limited web sales during the pandemic largely eliminated, several retailers contacted by Digital Commerce 360 were pleased with early results from the Thanksgiving holiday weekend.

Jeffrey Douglas, director of ecommerce at Nebraska Furniture Mart

Shopping at Nebraska Furniture Mart seemed to start earlier than usual this weekend, perhaps driven by offers of discounts, free shipping and financing, says ecommerce director Jeffrey Douglas.

“We are seeing inventory levels return to pre-COVID levels, so we’re in great shape when it comes to being in-stock,” he says.

Nebraska Furniture Mart is No. 310 in the Top 1000. The Digital Commerce 360 database ranks North American retailers and brands by online sales.

At Beanbox, an online coffee retailer, web sales jumped 15% on compared to last year. That makes it the strongest Thanksgiving Day in terms of sales in the e-retailer’s history, says Ryan Fritzky, co-founder and chief marketer at Bean Box. Bean Box is No. 1329 in the Digital Commerce 360 Next 1000 database. It ranks North American retailers Nos. 1001-2000 in ecommerce revenue.

Instagram ads produce strong results

Ryan Fritzky, co-founder and chief marketer, Bean Box

Fritzky says early access deals aimed at top customers and subscribers helped bring sales forward on Thanksgiving Day and likely contributed to the lower 5% growth on the next day, Black Friday. But he notes Black Friday produced strong subscription sign-ups.

“We’re excited about that because it’s a big opportunity for us to reach people who will be with us for the next year,” he says.

Bean Box got a strong response to its ads on Instagram and relatively weak traffic from Google search ads early in the weekend, Fritzky says. He says many consumers were scrolling through their social feeds on their phones Thursday and Friday and responded to appealing ads they saw, whereas they typically go to Google when they’re searching for items to buy.

“We’ll see stronger search demand on Monday as people scramble to make last-minute decisions,” Fritzky predicts.

More family gatherings help boost sales of baking supplies

Tom Funk, ecommerce director, Ann Clark Ltd.

At Ann Clark Ltd., sales turned up with the end of the COVID-19 pandemic and the resumption of social gatherings, says ecommerce director Tom Funk. Ann Clark manufactures cookie cutters and other baking supplies, and it sells direct to consumer at AnnClarkCookieCutters.com.

“U.S. sales growth was modest. As a premium brand, we try to steer away from aggressive discounting,” he says. “International — mostly Europe and Canada — was a bright spot, growing 20% to 50% depending on country.”

Profits have increased as Ann Clark selectively raised prices and tweaked its marketing campaigns, Funk says.

“Paid and organic search declined over prior year,” he adds. “Email revenue grew 35%. We’re a bit more in the mode of engaging existing customers, less about battling to acquire a lot of new customers.”

Sales are ‘better than expected’ for an online gifts retailer

Lynnette Kelley, part owner and business manager of Calamity Worldwide LLC, an online retailer of humorous gift items, says early-weekend sales were “a little better than I was anticipating. Not by much, but considering that our sales were lower than anticipated for Nov. 1 through 22, I’m happy to see that Nov. 23 through 25 so far have exceeded my expectations.”

She says sales were down 20% Thanksgiving Day through Saturday compared to the same days last year, “but we expected sales to be lower this year compared to last, as our whole year has been shaping up to be a little lower than last year.”

Lynnette Kelley, co-owner and business manager, Calamity Worldwide LLC

She says Calamityware.com customers may have put off purchases until Thanksgiving because the e-retailer promised a holiday giveaway of a reusable grocery bag featuring one of the retailer’s original designs.

“I suspect that has something to do with the lower-than-planned sales in the beginning of the month, and higher-than-planned sales so far this weekend,” Kelley says.

On a positive note, she says Calamity has been able to return to full price for some of its best-selling items this year without cutting into the number of larger orders it has received. That’s noteworthy in a season when online prices are generally lower than they were a year ago — Adobe says average online prices were 6% lower in October 2023 than the same month last year — and discounting is heavy.

Will online sales return to pre-pandemic patterns?

The 2023 holiday season could signal a return to pre-pandemic shopping patterns, with heavy discounting driving strong sales in November that result in muted online revenue growth in December, says Bennett of Signifyd.

“I expect Cyber Monday will be big,” he says. Sales that day often follow the pattern set by Black Friday, which was quite strong this year. “I’m very curious how much this will pull forward from December. November has been stronger than I expected, and I would suspect December will be weaker than we expected.”

Funk, the ecommerce director at Ann Clark, which generates most of its online sales on the Amazon Marketplace, foresees stiff competition ahead.

“Ecommerce, especially on Amazon, continues to be brutally competitive,” Funk says. “I expect it will be a challenging season, where much of our growth comes from new products. We recently launched gourmet waffle and pancake mixes, which are doing very well as folks return to more family gatherings.”

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Meanwhile, gross merchandise volume (GMV), the total value of merchants’ products across Shopify’s systems, increased 22% to $55 billion. Gross profit also grew, increasing 36% to $901 million.

45 retailers in the Top 1000 use Shopify. The Top 1000 is Digital Commerce 360’s database of leading ecommerce retailers in North America. The 45 using Shopify account for a combined $8.30 billion in web sales annually.

In the Next 1000, 74 merchants used Shopify in 2022 and accounted for $1.05 billion in web sales. The Next 1000 ranks the largest retailers after the Top 1000 (1,001 to 2,000) by web sales.

Shopify’s AI tools

Shopify president Harley Finkelstein said in an earnings call with investors that artificial intelligence is for everyone, and its capabilities should be embedded throughout a business.

“We’ve integrated Shopify Magic, our suite of free AI-enabled features across our products and workflows, and merchants are already finding success with unblocking productivity and creativity,” he said.

Shopify Magic enables personalized pages and content generation, he said. It can help craft an About Us page in a merchant’s brand voice or tone, he said.

Changing checkout benefits Shopify earnings

Finkelstein said in the Shopify earnings call that the company launched a new one-page checkout in September. In its first two months, Finkelstein said, it has sped up buyer completion time by an average of four seconds.

In the quarter, Shop Pay facilitated $12 billion in GMV, he said. That’s a 50% year-over-year increase. Since launching in 2017, it has facilitated a cumulative $110 billion in sales.

Finkelstein also said Shopify Checkout has helped its merchant base through Checkout Extensibility, which launched in 2022. Since launch, he said, Shopify has “exponentially expanded its suite of APIs, components and capabilities. It has also seen more than 400 checkout apps in the Shopify App Store that support Checkout Extensibility.

“It is more adaptable, loads faster and converts better, he said. “Designed to handle high volumes, it is ideal for the world’s largest flash sellers like the iconic brand Supreme.”

Shopify-Amazon deal

Shopify also announced a partnership with Amazon during the quarter, giving merchants the choice to offer Buy with Prime directly within their Shopify Checkout. Finkelstein said the app will release “in Shopify’s app ecosystem in the coming weeks.”

“This new app will give U.S. based merchants who use Amazon’s fulfillment network the option to add Buy with Prime into their Shopify Checkout, and all of it will be processed by Shopify Payments,” Finkelstein said.

James Risley, research data manager and senior analyst at Digital Commerce 360, said he doesn’t think the Shopify-Amazon partnership is making all the difference, but it “is a big deal.”

“Not only does it provide Shopify with a strong name to build on in its checkout flow, but it also allows retailers to not have to pick one vendor — Amazon or Shopify — to get the payment networks of each,” Risley said.

174 retailers in the Top 1000 offer Amazon Pay, whereas 130 offer Shop Pay.

Check back for more earnings reports. 

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Both men and women across all age groups buy in the category. But the majority of products sold are marketed to women.

How big is the grooming market in the U.S.?

Top 1000 retailers in Digital Commerce 360’s Health & Beauty category sell products for:

• Grooming
• Hygiene
• Cosmetics
• Skin care
• Hair care

But just 15.8% of those e-retailers specialize in men’s skin care and grooming products.

“Though a small compilation, these companies’ average growth outpaced our Digital Commerce 360 average for the Top 1000 and Next 1000,” said Digital Commerce 360 market research analyst James Reeves. “This stronger rise in purchasing products designed for men suggests these niche consumers are finding shopping online beneficial in a category traditionally associated with purchases for women.”

Online revenue for men’s grooming products in the Top 1000 grew 5.6%. That compares with 3.0% growth for the e-retailers in the health and beauty category that specialize in grooming and cosmetics. Men’s products online revenue grew 7.7% among the Next 1000. That compares with 6.0% growth for the health and beauty category specializing in grooming products.

The Top 1000 database is Digital Commerce 360’s ranking of the largest North American online retailers. The Next 1000 is a ranking of online small- and medium-sized online retailers by web sales.

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“Polybags are the worst thing in the world. Everyone hates them but they are a necessary evil,” says Steve McCann, marketing director at Toad and Co.

Polybags are the clear plastic bags the nearly all apparel items are shipped in. But brands can’t just get rid of them without a replacement. Retailers need something to shield a garment from the elements as it makes its way through a warehouse on a belt, being picked, packed and shipped and making its way on a ship, truck or van or all three to a store or to a shopper’s doorstep, where it may encounter rain, snow and sleet. If the product gets damaged at any point, it will be thrown out.

“The lifecycle of ruining a garment versus the lifecycle of a polybag is much worse,” McCann says.

Since Toad and Co. started selling online in 2014, the brand went from using one traditional polybag, to optimizing the design to be more sustainable in five different sizes. It aims to eliminate polybags completely by 2024.

Shipping a ‘better’ polybag

The brand’s first iteration of making its polybags more sustainable was shrinking the standard width of each polybag to better fit its garments. What’s more, instead of using one larger polybag that would hold any of its products, it invested in polybags of different sizes so that each bag fits the garment, reducing the plastic required. It also thinned out the plastic to further minimize the amount of plastic used.

Steve McCann, marketing director at Toad and Co.

In addition, Toad and Co. changed the location of the airholes on its polybags. It moved them from the bottom of the bag to the top and alerted shoppers these polybags could be reused to pick up dog waste, McCann says.

And even after all these efforts, the retailer is working to eliminate all these polybags.

One alternative packaging retailers use is a compostable polybag made out of plant-based materials. These bags, however, have mixed reviews from vendors and merchants. While compostable materials could be better environmentally than single-use plastic, it’s challenging for consumers to get the bag to the proper facility. A consumer would have to drop them off at a collection point that takes this specific material. If a consumer throws out this material it could emit more methane in a landfill than other types of trash, according to several vendors, analysts and retailers. And if a consumer puts the bag in the normal recycling bin, it could clog and contaminate the normal recycling process, causing the entire batch of recycling to end up in a landfill.

Toad and Co. switches to paper polybags

Because of these issues, in 2020 Toad & Co. started working with packaging vendor Vela to pilot its paper polybags. They are made of  Forest Stewardship Council-certified paper and can be recycled with mixed paper. This makes them much more likely to actually get recycled than a compostable bag. FSC is a nonprofit organization that ensures the paper is from a forest that is responsibly managed for environmental, economic and social benefits.

After piloting the paper polybags with a few products, the retailer confirmed they were sturdy enough to protect its garments and of the same quality as a traditional polybag, and began rolling them out across all of its products. Once the brand hits a certain minimum order volume of products at each of its factories, it makes the switch to using this product. As of Q2 2023, about 82% of its products use the alternative polybag and by spring 2024, 100% of them will, McCann says.

Toad and Co.’s shoppers have not commented on the switch in materials, but its wholesale accounts have reacted positively, McCann says. When brands ship items to stores, just like to a shopper’s home, each garment is encased in a polybag. Store employees open each bag and hang the garments up.

“They see it more so than anyone else, this is so much waste and so much plastic,” McCann says.

About 50% of Toad and Co.’s sales are direct-to-consumer online and the other half are wholesale to retailers, he says.

A more dramatic alternative: reusable packaging

To further lower its carbon footprint, Toad and Co. also gives shoppers the option to have their orders shipped in a reusable package. With vendor LimeLoop, Toad and Co. rents weatherproof bags. The bags are made of recycled polyester, mostly old billboards, on the outside. They have a zipper closure instead of tape and are recycled cotton on the inside.

For each LimeLoop medium bag, a retailer reduces 92% of carbon dioxide emissions and 99% of water use compared with shipping that order in a medium size cardboard box, according to LimeLoop. Similarly, for each LimeLoop small bag, a retailer reduces 42% of its carbon dioxide emissions and 9% of its water use compared with a polymailer plastic bag, according to the vendor.

The retailer piloted LimeLoop in 2018 and was one of its first clients. Its relationship ebbed and flowed throughout the years, as Toad and Co. has paused and resumed the service as it replatformed its ecommerce site and moved warehouses.

Here’s how it works: On the checkout page, shoppers can choose four shipping options, free standard, free standard with a LimeLoop mailer bag, paid second day or paid next day. If a shopper selects the LimeLoop option, her order will arrive in a reusable bag with instructions on how to return the bag. Once the shopper decides if she is keeping her entire order or is returning items, she visits ToadandCo.com to print a free return label. She puts the label it in the front sleeve of the bag and can drop it off in any U.S. postal service mailbox.

Toad and Co. commits to less packaging by sending orders in reusable bags.

Toad and Co. shoppers use LimeLoop

About 12-15% of Toad and Co.’s online shoppers select the LimeLoop package option, and 20% of those who chose LimeLoop as their fulfillment method, choose it again, McCann says. These are healthy numbers, McCann says, especially when considering how many new customers Toad and Co. has, he says without revealing more. For non-LimeLoop orders, Toad and Co. ships products in a 100% recycled paper mailer with water-based inks to ensure shoppers can recycled the bag.

Unlike thinning its polybags and increasing the number of polybag sizes it uses, the LimeLoop sustainable packaging is highly visible to the customer and something Toad and Co. receives a lot of positive feedback on, McCann says.

“It’s something that people when they look out their window, they get it. They get how many boxes they get from Amazon that you can’t even fit it all in your recycling bin anymore,” McCann says. “[Shoppers] understand it’s an issue, but they don’t see anyone doing anything about it. But they also love the convenience of [online shopping] and are not willing to change the convenience aspects. I think when brands have an option and it’s different and it’s addressing the issue, they love it and grab on to it.”

Printing the return label is a barrier for shoppers to using the service, McCann says. It is still working on the logistics of getting its systems to talk to each other to include the label with the package and how that would work if a shopper decides to return any number of items. LimeLoop says most of its clients include the return label with a package. LimeLoop has 45 online retail clients, mostly small businesses with annual revenue less than $5 million.

Challenges in getting the LimeLoop bags back

It takes about two weeks from when Toad and Co. ships an order to when it receives the bag back, a speed the retailer is continually trying to get faster, McCann says. The more it can reuse the bags, the better.

If Toad and Co. can use a LimeLoop package twice in one month, it breaks even in cost compared with traditional packaging. Otherwise, this shipping method is more expensive, McCann says without revealing more. LimeLoop rents the bags to retailers for about $1 per bag per month, and they can be used at least 200 times, the vendor says. So far in 2023, Toadandco.com has hit the twice-a-month frequency for each bag.

“Our benchmark KPI is that turnaround time,” McCann says.

When Toad and Co. first started using LimeLoop bags, it had trouble getting shoppers to return the bags, as some thought they were theirs to keep.

“The biggest part of the pilot learning was about the returns and how to communicate with customers,” McCann says.

In surveys, Toad and Co. learned that shoppers may take a few days to open their package once it arrives and then a few days to try on items and then decide what they want to keep. Then they have to print a label, which they may have to leave their house to do, and then put the bag in the mail. This all takes time.

About 12-15% of Toad and Co.’s online shoppers select the LimeLoop package option.

Toad and Co. learned that it needed to communicate urgency about returning the bags and educate shoppers in its emails about the importance of sending the bag back quickly in order for the process to be a sustainable option.

Communication with customers

In the five years since piloting the feature, industry standards have changed around communication with shoppers, McCann says. Previously, Toad and Co. hesitated to email customers more than three times a week, but now it has no issue contacting shoppers every day, McCann says. It can automatically send reminder emails via LimeLoop, as its systems know which customers haven’t returned their bags yet.

The vendor says some of its clients charge a few dollars as a deposit to customers to use the LimeLoop bag that retailers refund once they receive the bag back in the mail.

“This helps to keep the reusable packages always in motion and many clients utilize this feature,” a LimeLoop spokesperson says.

Bernardine Wu, executive managing director of digital strategy at digital consultancy OSF Digital, says LimeLoop is an interesting packaging vendor to watch, as it provides a sustainable packaging initiative that can scale and make an impact.

Integrating LimeLoop

It took a few months to integrate LimeLoop into all of the systems, McCann says. The retailer has done this twice, once when it launched, and then again in 2022 after a few months of program pause while it replatformed to a Shopify ecommerce site and moved warehouses.

When a shopper selects LimeLoop, the warehouse needs to know which order is selected for that package, as does its ordering platform, and shipping and return vendors. All of these integrations have to be built into its systems.

The merchant also had to learn how many shoppers would actually choose this option and how that correlates to how many LimeLoop bags it needs. Initially, Toad and Co. had 400 bags and it would frequently run out of them. Then, it couldn’t offer the option to shoppers until it received a bag back. In 2022 it invested in more bags for now a total of 2,800 and it no longer runs outs of bags.

Even though the system seems complex, Toad and Co. is happy with the program and the customer response. When Toad and Co. communicates to shoppers about the program either via email or on social media, those communication pieces always receive lots of feedback, McCann says.

While it wants to encourage more shoppers to choose this option, it is going to leave it at that, an option, McCann says.

“We can encourage and education and let people make an educated decision on what they want to do,” McCann says.

Toad and Co. is No. 1623 in the 2022 Digital Commerce 360 Next 1000.

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Beflax sells $300 linen sheets, and sustainability is one of its brand values. Many online luxury shoppers have come to expect an online package to arrive with ample tissue padding sealed with branded stickers, paper filler and ink branding on the box, says Katerina Rothman, founder and CEO of Beflax Linen.

“I want to give the best experience to customers,” Rothman says. “They are paying on average $300 per set, and people want to see the value — even in the box when they are receiving and opening it. There is still a missing link in the majority of consumers. Even if they are more sustainably minded and ecofriendly, they still want to have this luxury experience of all this tissue paper and opening a nice slick box.”

Initially, Beflax shipped its orders in an unbranded cardboard box — Rothman refused to use a plastic bag — with recyclable craft tape instead of plastic tape and extra tissue paper to connote a luxury unboxing experience.

Katerina Rothman, founder and CEO, Beflax Linen

“It’s against my principles to put the product into plastic bags or plastic tape over the boxes,” Rothman says.

Often, when a box is branded with too much ink, it can no longer be recycled. Rothman was close to signing a contract for custom boxes that included Beflax branding while still recyclable, but she decided against it.

“The price was good, but the part was killing me — there was no guarantee the factory in China was working up to ecofriendly standards,” Rothman says. “And it logically didn’t make sense to me to ship products from across the world.”

Beflax is based in Denver and manufactures its linen sheets in Portugal.

How shipping with LimeLoop works

In Q3 2022, a colleague introduced Rothman to LimeLoop packaging. The vendor provides reusable ecommerce packaging to retailers. The bags are made of recycled polyester, mostly old billboards, on the outside, have a zipper closure instead of tape and are a recycled cotton on the inside. On the outside, the package has a sleeve for the retailer to insert the shipping information, instead of using a sticky label.

After a few weeks of negotiating and a month of implementation, Beflax started using the LimeLoop bags as its packaging. Here’s how it works: Beflax ships all its products in one of three sizes of reusable bags to the shopper. The shopper receives the product, which includes a card for how to return the bag. The bag will have the return shipping label on the back of the main shipping label, which the shopper will flip over on the front of the package. The customer then mails this bag using any U.S. Postal Service box, and it will make its way back to Beflax.

Beflax ships all its products in one of three sized reusable LimeLoop bags for a luxury unboxing experience.

The bags can be reused at least 200 times. After that, LimeLoop will recycle them again into new reusable packages. Beflax rents the bags from LimeLoop for $1 per bag per month. Currently, Beflax rents 50 bags, which it can use multiple times per month. Beflax, which launched in 2017, has annual revenue around half a million dollars, Rothman says.

On average, it costs Beflax $16-18 to ship the product and about $4.50 for return shipping. Beflax absorbs some of these costs as it charges shoppers $15 for shipping. (Beflax provides free shipping for a consumer’s first order.)

Reusable packages works in practice for Beflax

The cost for Beflax is comparable to what it would cost the brand to purchase traditional shipping materials, including unbranded boxes, tissue paper, tape and sticky labels, she says. And the main return on investment, Rothman says, is that it’s the right thing to do.

For each LimeLoop medium bag, a retailer reduces 92% of carbon dioxide emissions and 99% of water use compared with shipping that order in a medium-sized cardboard box, according to LimeLoop. Similarly, for each small LimeLoop bag, a retailer reduces 42% of its carbon dioxide emissions and 9% of its water use compared with a polymailer plastic bag, according to the vendor.

Beflax has not conducted a poll about how shoppers feel about using the LimeLoop bags. Rothman, however, is confident the bag provides a luxury unboxing experience, describing the bags as slick with very nice inside fabric. The inside of the bags are so soft that the brand doesn’t wrap the sheets in any additional packaging, such as a polybag, Rothman says.

Beflax has not had an issue with shoppers returning the bags in the three quarters it has used the bags. If a customer is ever slow to return its packaging, Beflax contacts her reminding her to send it back, and she does.

Beflax also sells its products on Wayfair Inc., Etsy Inc. and Amazon.com Inc. Because Beflax doesn’t receive the customer information when selling on these platforms, it does not use the LimeLoop bags and uses its previous, disposable packaging, without the extra tissue paper. It’s too big of a risk to send out bags without the shopper information, Rothman says.

Brands search for more sustainable but luxury unboxing

Bernardine Wu, executive managing director of digital strategy at digital consultancy OSF Digital, says LimeLoop is an interesting packaging vendor to watch, as it provides a sustainable packaging initiative that can scale and make an impact.

“Retailers and brands should focus on the approach that makes most sense and is most viable to their business, but at the same time, it is important to make sure that sustainability initiatives are aligned to the customer values, and it has to be a sincere and prioritized effort,” Wu says.

LimeLoop launched in 2018 and has 45 online retail clients, mostly small businesses with annual revenue less than $5 million. It does have some enterprise clients, with a handful in the pipeline, a spokesperson says without revealing more.

EcoPackables is another ecommerce vendor that provides sustainable packages to ecommerce merchants, including recycled plastic, recycled cardboard and compostable materials. EcoPackables has been in business for four years and has more than 100 enterprise clients, such as Ted Baker and Revolve, and more than 2,000 small businesses, many of which are Etsy sellers, that use its products. It does not count many luxury sellers in its client roster, however. Founder and CEO Shervin Dehmoubed says this is because many higher-end brands are reluctant to give up the extra tissue paper “garnish” in their packages.

“The reason why we don’t do high-end packaging is it goes against our ethos. The amount of waste in that packaging is crazy,” Dehmoubed says.

But Dehmoubed is hopeful that this might change as more brands want a better sustainability story and more consumers demand it. In fact, it may even come down to social media influencers not doing unboxings with confetti coming out of the box but to having recycled paper in there one day, he says.

Toad and Co. reduces packaging with LimeLoop

Similarly, apparel brand Toad and Co. also thought deeply about its packaging and wanted it to tell its brand story in a robust and rich way, says Steve McCann, marketing director. For example, many new or luxury brands, such as Apple Inc. will tell their brand stories within the packaging and will include a booklet highlighting the products’ features or other details about the brand for a luxury unboxing.

“You say, ‘I want this for my brand,’” McCann says. “Then you ask yourself, ‘Is this what my brand stands for? And you say ‘No, that is so much waste.’ And how do we get beyond that? How do we still have that story while being minimal and being responsible?”

And so, Toad and Co. went minimal, with no inked boxes, no attached hang tag and no booklet describing its brand. Instead, it gives shoppers the choice between recycled paper mailers and reusable LimeLoop bags.

About 12%-15% of Toad and Co.’s online shoppers select the LimeLoop package option, and 20% of those who chose LimeLoop as their fulfillment method choose it again, McCann says. These are healthy numbers, McCann says, especially when considering how many new customers Toad and Co. has, he says without revealing more.

“When brands have an option and it’s different and it’s addressing the issue, they love it and grab on to it,” McCann says about the LimeLoop bags.

Toad and Co. is No. 1623 in the 2022 Digital Commerce 360 Next 1000.

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