How Ikea is leading the way on sustainability

Episode transcript, edited for clarity

Bill Thorne: Welcome to Retail Gets Real, where we hear from retail's most fascinating leaders about the industry that impacts everyone, everywhere, every day. I'm Bill Thorne from the National Retail Federation, and on today's episode we're talking to Mardi Ditze, country sustainability manager for Ikea U.S. Now, we're going to talk to Mardi about her passion for environmental stewardship, Ikea's impressive sustainability efforts and goals, and the role of retail in the circular economy. 

Mardi Ditze, welcome to Retail Gets Real. 

Mardi Ditze: Hi, Bill. So great to be here. Thank you for having me.

Thorne: Where are you, by the way?

Ditze: So, a bit of trivia here, the headquarters and first location of Ikea in the United States was just outside Philadelphia, Pennsylvania, in a town called Conshohocken, Pennsylvania.

Thorne: No way.

Ditze: Yes. So, we are about 20 miles outside Philadelphia. So that is where I'm 
located.

Thorne: North? West? South? 

Ditze: Southwest of Philadelphia.
Thorne: We lived for a short period of time in Pennsylvania. I grew up primarily in Georgia, but we lived in Bucks County. Yardley. 

Ditze: Yeah, yeah. So, Bucks County is right next to Montgomery County where we are located. 

Thorne: Anyway, so now we know where you are, but tell us a little bit about your background. I mean, how did you get into retail, and how did you get into sustainability specifically?

Ditze: Excellent. It’s a great question because it’s not linear. I think now people have an opportunity to do a linear, trajectory into this field. But when I started, there was none, so I crafted it myself. It was not planned. It was a lot of luck and chance, and Hail Marys. 

Thorne: Yep. Welcome to life. 

Ditze: Right? It’s so true. People say that when you're young and you're like, “No, there has to be a linear, a linear path.” No, not, there's that.

Thorne: It literally is. It's one of those things that, “Give me the directions and I'll follow them to success,” and in fact, that's never the way it goes.

Ditze: Very much like Ikea instructions, right?

Thorne: Yeah, yeah. But now you can pay somebody to put it together. So, if I could pay somebody to get me to where I needed to go, that wouldn't have been a bad idea actually.

Ditze: Well, we'll put that in an investment scheme. But to the actual question, I graduated from college with a degree in sociology. So, what do you do with that? And I work with people, and I like to think that I use my degree every day (and that is what I will go to my grave telling my parents). 

So, I graduated with that, and I think like many, at the time — like many postgraduate students do — you work in retail. It's an easy start to any career. So, I did. I worked for a lot of large retailers coming out of college because it was an easy job to get. Not understanding that you can actually apply your passions in retail. 

So, I saw an opportunity while working at Starbucks coffee to get passionate people organized around sustainability. How are we recycling? How are we collecting things from our communities? How are we engaging with our communities? So, I organized all of us to have the country's first Green Team, Starbucks Coffee's first Green Team in the northeast. So that was my first entry to actually applying sustainability to my passion, to what I was working on. And then from there, it snowballed for me. 

I realized that that's what I wanted to focus on and whatever company I was going to work for moving forward had to have those same values. Whether they had them or not, I saw that I had an opportunity to make it. So, I worked for a series of companies and always had that value in mind. 

But I think the real boost in my career came when I started working for a renewable energy company and I was working for them as a customer services manager. Not what I expected, but I was able to talk to people constantly about renewable energy, which really gave me depth in the industry, which led me to become — the opportunity presented itself to become a solar developer. So, I was actually putting steel on the ground for the company, which was a really fascinating look about how communities and businesses can work together, and also get really deep in the weeds about how does the industry work. How do you put steel in the ground? 

So, from there, an opportunity presented itself to work for the City of Philadelphia in their sustainability office — in a smaller office of their energy office — where I helped manage the portfolio of buildings and energy for the city. And then from there, came to Ikea. The position opened and I found it. I didn't know anybody, right? So, I just threw my hat in the ring and they found me. So, I think that that's also a good point to put in there because opportunity does present itself and you need to put your neck out there to try. You never know what's going to happen. 

Thorne: Well, you know, we always talk about it. You have to take a risk every once in a while, and sometimes it works and sometimes it doesn't. But usually when it does, it was well worth it. So, what is it that you … I mean, you're in this position, you kind of come full circle, now you're back in retail. What is it that you love about your job, and specifically about your job and working in sustainability?

Ditze: Now, knowing my background, I can say with certainty that I've never been in such a position where I have the opportunity to make so much change. Retail is a big machine and there's a lot of money in it. So how do you apply that money and leverage the machine to get to be able to make change in communities in the U.S., globally even? So, I love that challenge and the opportunity that presents itself within that challenge.

Thorne: You used a word earlier, that I've used excessively on Retail Gets Real because I'm talking to these fantastic retail leaders like you. You said passion. Would you say that sustainability is your passion? 

Ditze: Yes. And I hesitated there because it’s a double-edged sword. It is my passion, but it's also, it's hard. 

Thorne: For sure.

Ditze: There were times in my life where I wanted to walk away because the passion, it’s draining. It's draining, it's hard, and I was just pondering last night about Greta Thunberg. And she's such a young girl — not really anymore, but when she started, she was so young — and how much that must have taken out of her, and how draining that must have been for her at such a young age to have so much passion for that. Because here I am much older than her — not going to declare my age, but … .

Thorne: That's alright. You're young. That's all I can say. You're young.

Ditze: And feeling that drain sometimes. There's a great responsibility in the passion that this job carries. 

Thorne: I would think that a lot of it is, I mean, educating people. Now, sustainability is not new. I mean, we've been talking about recycling, and things of that sort for perhaps all of our lives. But I came from Walmart, and I remember back when Walmart was really getting into the sustainability side of the business, and talking about what sustainability meant or what it means getting the associates — store associates — involved, and engaged and thinking themselves: How are ways that we can be more sustainable? As simple as, one associate said, “Well, what we should do is — in the break room, we don't need lights in the vending machines. Turn the lights off.” 

So, people started thinking about, you know, what it meant to be responsible or what it meant to be sustainable. So, I would think that – it’s not new. But it is new because there's so many new technologies. I mean, how do you … if you were to define what you're doing … is a lot of that just education?

Ditze: Yeah. Here we are so many years later and it's still about education. Because you have new people coming into the sphere, you have people that hadn't thought about it before, and now they want to think about it. It never stops. Even though I've been doing this for 30-plus years, there's always new stuff to learn. There’s new technology, there's … so, yes, it's a lot of education. It's a constant communication about it, and engagement. 

Yeah. And you have to meet people where they are. Not everybody wants everything all at once. So, if you just want to talk about recycling, let's do that. That's what we call the gateway conversation because once you get, once you understand recycling, you understand how much more there is.

Thorne: Yeah, for sure.

Ditze: So. Yes, it is a lot of it. It's constant education. Constant communication and constant conversations, like this one. Somebody might be listening and hadn't thought of it like that.

Thorne: For sure. Absolutely. You can have that conversation on a high level, but if you get people involved and engaged, it begins to make sense. So, to your point, you have to meet them where they are, and bring them along. Invest them in it, and they'll get excited about it.
So, Ikea has some really strong sustainability goals. How is the company moving toward those goals? How are they doing that?

Ditze: In so many ways. It's never a dull moment and every day is not the same. There is always a new conversation, a new thing to look at, which is really exciting. From the retailers I've worked with, Ikea is probably the most advanced in the conversation because they put sustainability as part of the design process of their products.

So, when they're creating a chair, a table — a “name that product” — sustainability is part of the conversation. What materials are we going to use for this product and how are we going to help our suppliers along the journey? So even starting from the raw material that they're going to use, or recycled material that we're going to use. What is that and who is the supplier? How can we help that supplier become more sustainable in their journey so that we can help the entire system. So, when you're talking about systems thinking in retail, Ikea’s doing it, which is really amazing. And that's the supply, and design, and logistics part of how the machine works. 

But once it gets to the United States, that's where my job starts. So, it's now — from the port, it's in our stores — how are the stores operating in a really sustainable way? And that's what I think about. Making sure that we're being energy efficient. Using solar where available. Ninety percent of our units are using renewable energy, and we are producing more than we use, which is a really amazing soundbite to say for such a large footprint. 

Thorne: Yeah, for sure.

Ditze: Our stores aren't small. 

Thorne: Your stores are many things but small is not one of them. 

Ditze: Yes. So, to say that: it’s a big statement for such small words. So, we're doing that. We look at what is our waste stream look like, making sure that we can do as much composting as we possibly can. Making sure that we can recycle as much as we can. Making sure that we can donate before it goes to landfill, and making sure that we're engaging the coworkers so that they understand how their impact is. So, it’s a lot of the same things that we do residentially looking at how we're managing our homes and applying that to a retail setting. So, it's very similar, just bigger.

Thorne: So, Ikea’s been doing this for a while. How, you know — I think one of the big challenges that retailers have in setting some sustainability goals is bringing the suppliers along with them. Has that been easier for you all because you've been doing it for so long? Or are you still doing that, trying to get them up to speed, educated and engaged?

Ditze: Yes, and we have been doing it for a very long time, and we have a process — an internal process that we use to make sure that the suppliers have what we require, and if they don't meet those requirements, we can help them. We don't just walk away. We'll help them get there. If we really want to work with them, we'll help them get there. But if we see that their values are not aligned with ours and it's not going to be a journey that they want to go on with this, then we'll walk away. So it's both. We have a process. We've been using it for — gosh, since the 1980s we've been doing this. Yeah. Because Ikea came to the U.S. in 1987, so specifically since ‘87 in the U.S.

Thorne: I thought … It's so funny because it’s so … I don't know. If you said, “Hey, Bill, when do you think Ikea came into the United States?” I would've said probably like in the 1970s, but it's 1987.

Ditze: Yeah, recent-ish history. 

Thorne: So, the circular economy. We talk a lot about the circular. What is the circular economy, and what role does Ikea us play in that?

Ditze: Ooh, that is a big conversation. One that we could probably have just on its own. Circular economy. So, at the end of the day, keeping things out of landfill, right? You want to keep everything out of the landfill. So, how do you do that? Either don't make it or keep it in production and in use as long as you can. And, by use, you define that use. Are you going to use it as is or do you design for second life? 

So, there are a lot of components in that conversation, but at the end of the day, it's really just making sure that something can stay out of the landfill for as long as possible or be recycled as many times as possible. 
And Ikea's first entry into building the circular economy is with our buy back and resell. So, if you buy an Ikea (when you buy an Ikea product), you can bring that back to us and we can buy it back from you. And then we'll put it into “as is” or donate it or find a second life for it. 

Thorne: Really? 

Ditze: Yep. 

Thorne: That's pretty awesome. 

Ditze: Yeah, we've been doing it two years now in the U.S. It's gaining more success. It's a, I think you just said, the a-ha: “Oh, Ikea does that?” We don't talk about it enough. So yeah, we have a buyback program, bring your stuff back to Ikea, we will buy it back from you. You get a voucher from us to buy more Ikea product or use it in our food area if you like.

Thorne: Meatballs. 

Ditze: Or plantballs. We have plantballs.

Thorne: Of course, you do. 

Ditze: They're pretty tasty. 

Thorne: So, the buyback program. You said it's been going on for two years?

Ditze: yep. 

Thorne: Are you seeing more and more people taking advantage of that or … ?

Ditze: We are. While it's still a small percentage of our operations, the more we talk about it, the more people know about it, the more product we get back. And, I think it's also a testament to people keeping this, the things. If they're not coming back, then we either assume that people are keeping the things, or potentially using another platform to buy, sell, trade, because we all know that there are other platforms. Part of the circularity is understanding where your product is going. So, if we can get the products back to our stores, then we can have transparency and traceability about where our products are going. If you use another platform to do that, that's where we lose visibility.

Thorne: Right. 

Ditze: Transparency is part of circularity.

Thorne: So, if I have a bookcase and I bring it back, I say, “I'm done with this, or I've moved into a new place. I don't need it.”

Ditze: Mm-hmm. 

Thorne: You buy it back. What happens to it?

Ditze: We decide what to do with it. It either goes into our “as is” section where, you know, like a secondary marketplace within our stores. Or we donate it if because it's still functional, but we can't sell it, then we can donate it. And the last thing we look at is recycling. It's the last chain of command there.

Thorne: Interesting. I'm really, really intrigued … that … it’s so elemental. I mean, it's so easy to understand. It's kind of wild that that hasn't been done more widely. Not Ikea, I mean just in within the industry itself because it just, it makes all the sense in the world. And, you know, to the extent that you, you know, it's not like it's hitting hard on the bottom line. I mean, at the end of the day. And it's good. I mean, it's good for the environment and it meets so many of those checks that people are looking for these days in terms of how businesses operate …

Ditze: Yeah, 

Thorne: … in a way that makes sense for the consumer.

Ditze: You are right. The challenge and the conversation that we need to overcome in the circularity industry or economy is twofold. It's one about what we call cannibalism — how does the secondary market compete with the primary market? And are you really taking away from the primary market? And our answer is no. There are consumers out there who are looking for that secondary market, who are looking for the, I'll call them deals, that are available on product. Everybody has a different size wallet, so we want to offer something for everyone. Some people have thinner wallets than others, and that's what these products can offer is an opportunity for them to have an Ikea product at a value for them. 

And then the second challenge we have in the secondary market is the perception. Not everyone wants to participate in the secondary market, and that's okay. But if you stop and look around your home, how many hand-me-downs do you have? How many pieces of things do you have that your family gave you? Or it was your grandmother's, it was your great-grandmother's. So, everybody participates in a secondary market. It's just how you're doing it. So, there's a perception around it that we need to change.

Thorne: So, I'm looking in the video and I'm looking over my shoulder and it's like, well, that typewriter was my dad's. 

Ditze: And that rotary phone behind your shoulder …

Thorne: The rotary phone was obviously my dad's. 
It takes so many different forms in terms of a secondary market. That's pretty cool. You wouldn't really necessarily think of it that way. So, in the state of sustainability … so this is what you live, this is what you do, this is what you think about every single day. And, so sustainability in the retail sector as a whole, where do you think is the biggest opportunity for retailers to lead? 

Ditze: Policy. Policies are starting to pop up around extended producer responsibility and state legislation around recycling. What we're seeing is that those types of policies are very siloed. They'll be around batteries or they'll be around textiles or they're on … name that particular … 

Thorne: Electronics. Everybody says electronics …

Ditze: Yes. Exactly. Which is great, but if you've got a multifaceted product that includes batteries, that includes textile, it includes wood, plastic, what do you do with that? So, I think if retailers come together and start talking about the policy around the materials that are going into the products, we could have better legislation that we could all use — not just apparel, not just electronics. So, I think there's real opportunity there for us to come together to talk in one voice about policy and legislation for the betterment of everyone.

Thorne: As you know, we have a lot of students that listen to this show, and we talked a little bit about it at the top, but what is the best piece of career advice you've ever got? 

Ditze: That’s a timely and ever-evolving question.

Thorne: Sure.

Ditze: The advice I got when I was 20 was great, and the advice I got two years ago was great. So, I think it really depends on where you are, what the advice is that you're going to listen to. 

So, if we're talking to students — and it wasn't the best advice I got, but it was more of an a-ha — it was somebody believed in me, and they helped support me to see the vision that I couldn't see. And his name was David Ash. (So, if he's listening, thanks Dave. I thanked you before. I'm going to thank you again publicly.) And he saw my passion, he saw my potential, and he helped me. He helped me a lot, in various ways in whether it was advice or in opportunity or in getting over my own fears. He was there for me, and so find somebody, and keep people around you that believe in you because this work is hard. And if you keep people around you that don't believe in what you're doing, it's going to make everything harder.

Thorne: You know, I was going to ask you this earlier, and so I'm going to ask you this now because I think it's interesting to me, and I hope somebody else is interested. If you were to say to somebody, if you want to be in sustainability you're going to go to college, the degree you should pursue is … sociology?

Ditze: I don't have bias or anything. 

Thorne: Got to understand how people operate. 

Ditze: It's so true. It's so true. But we also need the scientists and we also need the engineers. And we also need, we need all of the people. So, get a degree in something that you're passionate about. It doesn't have to be anything related to the environment, or to people, or to whatever. Go for what you're passionate about. Basket weaving. Because we need social entrepreneurs too. We need products. That's the advice I would give, because sustainability, it's for everybody. It's not for a particular degree. It's for everyone.

Thorne: You got that right. 

Ditze: Yeah. 

Thorne: Mardi Ditze. It has been a huge pleasure talking with you, and thank you so much for joining us on Retail Gets Real. 

Ditze: Thank you so much for the opportunity. It’s been a pleasure to talk with you. If you are in need of another podcast interviewee, I'm available anytime. 

Thorne: Don't do that unless you mean it. And thank you all for listening to another episode of Retail Gets Real. You can find more information about this episode and others at retail gets real dot com. I'm Bill Thorne. This is Retail Gets Real. Thanks again for listening. Until next time.