Delivery is a continually evolving and improving aspect within the retail industry. 2018 saw the management of delivery processes taken on a form of their thanks to automation, personalization, and digitization.
The previous year was witness to the 24-hour delivery service to an extent where online purchasers preferred this option over the more traditional 2-3 day economy delivery. The idea of ‘click and collect’ also spiked for online orders across channels. Delivery of an order within 120 minutes of purchase became a viable option, especially in terms of smaller retailers.
That said, the quick evolution of the delivery sector also encouraged a few negative trends to develop. These include, to name a few, the return of one-time used clothing (thanks to the ‘hashtag moment’) as discovered by Barclays. This phenomenon is also known as serial returning and is largely responsible for keeping the level of on-time delivery below the levels achieved during 2015-2016. More details here.
The consensus is that companies need to increase their efficiency and increase visibility into their operations. Their supply chain needs to take on a more robust nature. They need to adopt technology as a solution and answer to their problems of overcoming the current challenges in the delivery field.
5 Delivery Trends in 2019
Third Party Delivery
During the third quarter of 2018, the third party delivery market was worth over $7 billion. Based on these and other reports by Technomic, this number is set to grow as an increasing number of consumers gain familiarity with placing orders online.
This shift in user behavior is pushing established brands to modify their point-of-sale systems and encourage a digitally focused marketing spree to attract and retain consumers.
When it comes to a well thought out and a well-established plan for digitally marketing strategy, third-party delivery options can go a long way in propping up business earnings. On the other hand, if proper due diligence is not done before selecting a third party company, the organization may find itself in a conundrum with regards to figuring out how best to gain the trust of its trusted customers.
Same Day Delivery
Given the fact that the consumer market of today is becoming increasingly competitive, it is of paramount importance to have accurate business strategies in place for each sector that the business intends to target.
In case the business is in the market where same day deliveries are the norm, the focus should always be on fulfilling the demands of the customer within the shortest period as possible.
When considering a global audience, same day delivery is not a mere concept anymore. It has evolved to become a standard practice in many different industries. Whether it be food and beverage, fast-moving consumer goods, medical suppliers, fashion retailers or vehicle accessory suppliers, the principle of making products available to customers in as little time as possible holds.
With the evolution of e-commerce, a large percentage of purchases is now accomplished with a click of a button and a swipe on a mobile device. This speed and convenience have led purchasers to believe that the delivery of the goods they have ordered should be an equally simple process.
A recent study by PwC revealed that buyers hold a higher value to the immediate delivery of purchases – as many as 88% of buyers were willing to pay extra for faster or same day delivery. A similar study by McKinsey revealed that buyers found same day delivery more attractive even it costs 7-8% more than the normal of the purchase.
Delivery by Self Driving Cars, Robots & Drones
Given that delivery of purchases by drones is still a pretty futuristic idea, online purchases are already opening up to this possibility. The increase in the number of parcels that require delivery will force courier companies to look into new-age technologies in an attempt to meet the increasing demand. This helps the retailers to optimize their delivery routes and access places that are otherwise hard to access by usual transport.
The utilization of self-driven robots have already commenced in different across the globe and are being continuously monitored by human operators located in strategic control rooms. Some take-away companies in various countries are already testing the feasibility of this new age technology to assist with their increasing delivery commitments.
Additionally, the concept and utilization of autonomous delivery is certainly coming up fast on the horizon. Experts in the field expect that self-driving vehicle will be around very soon. Indeed, car manufacturing icons like Ford and General Motors are already well advanced on the way of adopting self-driving technology. If such companies are successful in paving the way for self-driving vehicles, it is estimated that 80% of purchases will be delivered by autonomous cars by the year 2025.
Pick Up and Pack Companies
There is an increasing number of retailers in the market that utilize pickup, pack, and ship companies to deliver their products. These companies are similar to courier services between the buyer and the seller.
Not surprisingly, such companies are becoming more and more popular, especially when it comes to e-commerce businesses. This is primarily due to the fact that they offer the opportunity of same day delivery which a large part of e-commerce retailers were unable to guarantee earlier.
Online purchases expect a quicker and higher standard of service when they take part in online shopping. This is precisely the type of service that these pick up and pack companies are striving to offer. The speed of delivery plays an enormous part when it comes to a consumer’s buying decision. This added incentive can go a long way in shifting the scale in favor of the e-retailer.
Lockers and Pick Up Sites
A few delivery companies have begun offering locker pick-up services as a viable option for delivering packages to the customer’s location. Purchases are now able to select a self-service, secure place to have their package delivered and can pick them up at their convenience.
In case a purchaser opts to have a package delivered to a locker or similar facility, they usually receive a passcode which can be used to open the delivery locker.
The option of a locker helps inhibit the instances of stolen or misplaced packages. It has proven to be a far more secure option when compared to leaving a box at the front door of a customer.
From the company’s perspective, it saves the e-retailer money and time as many packages can potentially be ‘delivered’ together at a single location. Amazon has paved the way in utilizing this option. Amazon now boasts of more than 2 thousand such places in over 50 different cities.
FedEx is another company that has utilized this trend. FedEx has partnered with Walgreens and now has the option of picking up packages at specific, pre-defined locations.
To conclude, 2019 is set to emerge as an exciting year when it comes to delivery trends. Given the predicted increase in the usage of same day or next day delivery, combined with a bias towards cost and time-saving options, there is a good chance that the delivery trends we have experienced so far are set for a change.
The same time next year will be an exciting period to gauge how far the delivery industry has evolved. For now, it’s time to prepare, analyze and adapt!