Tracking & Choosing drive the new normal in home deliveries

The new battlefield, of course, will not be offering delivery per-se but finding the best balance between price, convenience and scalability so that the three actors of this play: shipper, carrier and user get the most from the experience.

Tracking and choosing can do miracles in an e-commerce world shaken by the pandemic.

Recent research published by LaserShip gives us some precious insights into the home-delivery scenario that is still developing during the Covid-19 pandemic. Numbers refer to the USA market but are strikingly similar to those in Europe.

E-commerce penetration jumped from 16% to 27% from the end of 2019 to April 2020. 48% of consumers plan to shop more online even when they will not be forced to due to the effects of the pandemic.

What grabbed our attention is that, apart from the usual dominance of free-standard shipping and free returns, a staggering 61% of shoppers said that they are more likely to shop again from a website offering the ability to track their order in real-time. 40% will do the same from someone that lets them choose the ideal shipping time at the checkout. Then, at additional cost, come next-day shipping, two-day shipping and same-day shipping, all at 28%.

In the meantime, delivery satisfaction has dropped, with 32% complaining about slow deliveries and 27% stating that the trouble is in the lack of delivery options.

With the whole online scenario jumping 5 years ahead in the span of a quarter, scalability has become a widespread issue and home delivery has taken aback a lot of retailers who had to dive into the e-commerce scenario to stay relevant. And the “perfect storm” of holiday shipping is brewing.

The new battlefield, of course, will not be offering delivery per-se but finding the best balance between price, convenience and scalability so that the three actors of this play: retailer, carrier and user get the most from the experience.

More demand means more friction with the consumers and that’s something that retailers will inevitably move to the carrier.

As admirably explained by Amazon’s analyst Aadil Kazmi: “in an age of hyper competitiveness in the retail sector, shopper satisfaction is the priority for every retailer — and all business decisions will be made based on what satisfies the shopper the best — including which delivery service to partner with”.

Traditional carriers, crowdsourced couriers and last-mile tech-enabled carrier startups are thus competing for the same piece of the pie. The first are usually the slowest; the second work on a 1 to 1 basis, introducing a new intermediary and privileging speed over planning. Only the third seem poised to maximize the delta between experience and revenue.

Going back to LaserShip’s research, how is it possible to offer real-time tracking and the ability to choose the ideal shipping time at a scalable price?

Home-delivery tech platforms, such as Milkman’s, are able to work on different levels, employing AI and machine learning to manage supply vs demand, residual capacity, pricing and advanced mission planning, enabling a wide array of delivery options and driving consumer behaviour, so that Value Added Services (such as same-day delivery or flexible time-windows) and standard services integrate and subsidize each other. This can be done while constantly being in touch with the recipient.

Those who thought that lockdowns would mark the resurgence of anytime delivery are being proved bitterly wrong: more than ever shoppers need certainties and control. Above all, in part defrauded of the physical shopping experience, they righteously pretend not to be the last ring of a chain but the main persona of the whole process.

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