The transition to a circular economy presents opportunities for growth and deeper customer loyalty while addressing the pressing need for sustainability in the retail sector. Our research reveals that retailers are finding that sustainable private labels set them apart. Sustainability is a differentiator for retailers and sustainability-marketed private label products help retailers enhance customer loyalty by meeting eco-friendly consumer demand. In 2025, private labels are firmly established on global CPG markets with continued growth due to consistent strategic investment. 

The over-purchasing triggered by promotions is a growing sustainability concern.  

Consumers tend to be more wasteful when faced with promotional offers, especially when discounts are involved. Purchasing patterns, preferences, and habits directly influence demand. When these are misaligned with actual needs, waste becomes an unavoidable consequence. Retailers can optimize promotions by focusing on targeted offers that align with actual demand, reducing overproduction and unnecessary waste, and considering the long-term impact on their bottom line and the environment. Integrating real-time data into promotional planning can help you better understand consumer behavior and prevent the cycle of waste caused by ill-timed or excessive promotions. 

Another challenge faced by circular retail business models is the often-large costs that are difficult to recoup from consumers, but companies are prioritizing waste reduction and packaging reuse with economic benefits too. Our research with New York University Stern Center for Sustainable Business reveals that since 2019, sustainability-marketed products (+12.4%) are growing at 2.3 times the rate of conventionally marketed alternatives (+5.4%) – and since 2013, have delivered more than 40% of growth. And they enjoy an overall 27 percent price premium compared to conventional counterparts, although premiums do vary by category.  

Stilbaar – the world's first fully circular fashion retailer – buys back every handpicked garment they sell as soon as the consumer is done using it regardless of condition. Stilbaar started as a sustainable fashion e-commerce platform, but today, no garment ever sees landfill or goes to waste. Once they receive a sold-back garment, they do everything possible to refurbish and re-sell it at its highest value and guaranteed to be free of defects. When a garment reaches the end of its life, they bundle it with others and deliver to textile-to-textile recyclers to make it into new fibres. And they sell only garments made of natural fibres to be used as feedstock for these processes. Consumers can check the current sell-back price of a garment at any time simply by tapping their smartphone on an NFC tag they attach under or next to the brand label. 

Technology can help address the waste driven by consumer behavior.

AI-driven demand forecasting can analyze historical sales data, market trends, and even weather patterns to predict demand more accurately to influence your inventory. For example, this level of precision in forecasting helps restaurants reduce food waste by up to 20 percent. Inventory management systems equipped with real-time tracking capabilities can also monitor stock levels, shelf life, and sales patterns to identify slow-moving or at-risk items early so to implement targeted discounts or promotions. Additionally, certain apps and loyalty programs can engage consumersdirectly. Features like personalized shopping lists, waste reduction tips, and rewards for sustainable practices help reinforce eco-friendly behavior, such as Too Good To Go, which has helped save over 400 million meals from being wasted since 2016 with its app – the world's largest marketplace for surplus food. 

Transitioning to a circular strategy is a differentiator for retailers. And the secret to rejuvenating retail through sustainable strategies is Circana’s unrivalled supply chain solutions, data and analytics will optimize operations, improve forecasting and replenishment rates, enhance retailer collaboration, mitigate risks caused by disruptions, enhance customer experiences, and contribute to a more circular economy. Learn more in Circana’s Revitalising Retail Outlook Report.