Delivery Solutions Boost eCommerce Consumption

As retailers and the parcel delivery industry continue to explore ways to improve the end customer’s delivery experience, one thing is becoming indisputably clear:   there is no one-size-fits-all delivery solution that will delight every customer (and retailer).  Just like customer addresses fall into multiple types of delivery environments (rural, urban, suburban, multi-family dwellings, high-rise residential and business buildings, high crime neighborhoods, etc.), each with its own set of challenges, so will the delivery solutions.  This was plainly apparent at PostalVision 2020’s recent “B2Me” event, which focused on how consumer empowerment and demands are changing the global postal ecosystem and supply chain.

And another thing is becoming clear:  improving the consumer’s delivery experience results in an increase in ecommerce and satisfaction with the retailer that achieves it.

Industry research has supported the link between the delivery experience and ecommerce growth for some time.  The recently released IMRG UK Consumer Home Delivery Survey 2015 reported that 70% of UK shoppers confirmed that a good delivery experience will help keep them loyal to a particular retailer.

According to JDA Software’s 2015 Consumer Survey, “over 50 percent of those who have experienced an issue with home delivery of an online order anytime over the last year say they are unlikely to shop with that retailer during the holiday season… [and] 35 percent of those who have experienced a negative delivery issue with an online order say they are not likely to shop with that retailer again—period.”

In PwC Strategy&’s article, Navigating Retail’s Last Mile, the authors emphasize that the “underlying drivers of success in retail, and particularly in the last mile — speed, variety, convenience, and cost — still depend on the physical supply chain, not merely the ephemeral zeros and ones employed in the world of digital engagement.”  “The physical elements of those trade-offs move far more slowly than the technological shifts,” they said. “The bottom line for companies? Get the structural elements of your last-mile approach right, build digitally engaging technology to capitalize on it, and train your customers to behave to your advantage.”

And the list of research and studies bearing out the link between the delivery experience and use of ecommerce goes on and on…. But PostalVision 2020/6.0 attendees recently heard firsthand from several delivery experience innovators about how improving that experience for the customer led to significant growth in use of ecommerce in general, and both approaches were somewhat retailer-agnostic.

At this year’s National Postal Forum (NPF) Gray Hair Advisors hosted a thought-provoking series of “Live from the Forum” panel discussions, including one moderated by PostalVision2020’s Director of Community & Brand Development Kathleen Siviter which discussed insights from PV2020’s recent event,  as well as the panelists’ views on disruptions taking place in our global postal ecosystem.  Panelists included Dr. Andrew Tipping, a principal at PwC’s Strategy& and lead of its North American transportation and logistics practice; Brian Bowers, Chief Technology Officer at Bell and Howell; and Jody Berenblatt, Senior Advisor, Gray Hair Advisors.

During the NPF panel session, Jody Berenblatt, Gray Hair Advisors, highlighted how at least two delivery solutions businesses in their PostalVision 2020/6.0 presentations talked about their firsthand experience of how improving the delivery experience for consumers actually resulted in a significant increase in ecommerce consumption.

 

Doorman Sees 57% Increase in Consumption

Dan Treiman, Vice President of New Markets, Doorman (http://www.doorman.co), in the B2Me Last Mile session at the recent PostalVision 2020 event said that consumer online shopping increased 57% as a result of offering customers its delivery solution.  When Doorman customers were asked how many packages they received on average per month before and after starting to use its solution, there was a 57% increase.

Doorman’s solution schedules last mile delivery by offering customers a Doorman delivery address for use when they place orders online, which is a Doorman warehouse.  Doorman then allows the customer to schedule delivery between 6 pm and midnight, 7 days a week, for 30 days after the package was delivered to Doorman.  It also provides pick up and return services.  Doorman’s API allows retailers to incorporate it into their web sites.  Doorman appeared on Shark Tank in January and now is in hot demand to extend its service to many areas of the U.S.

 

ParcelHome Sees 20-40% Increase in Consumption

Gregory Mackin, CEO of Europe-based Parcelhome (http://www.parcelhome.com), said that according to statistics gathered after live use of their parcel delivery box solution in Belgium, there was a 20% overall increase in online order consumption and up to 40% increase in some product categories.  There were significant cost reductions for the carriers in that 98% of deliveries were made on the first attempt, with consumers bearing the cost of the box as long as it remained multi-carrier/carrier-agnostic.  Mackin said in Europe there are 11 different carriers currently delivering into the same box, including Amazon, DHL, FedEx, UPS, and others.  You can send and return from the box, and both the box user and the carrier can open it using mobile device, with every access tracked.

“Solving the delivery experience for customers is a big issue for all of us in this room,” Mackin told the PostalVision 2020 audience, “and it’s a big issue for retailers.”

 

Delivery Solutions Not One-Size-Fits-All

The PostalVision 2020/6.0 event featured a diverse collection of entrepreneurs, start-ups, and established businesses offering innovative solutions to the delivery conundrum.  From drones, to ground robots, to delivery scheduling apps, to parcel lockers, and more – the potential solutions are as diverse as the businesses behind the innovations.

Brian Bowers, Chief Technology Officer at Bell and Howell, moderated a panel at the PostalVision 2020 event where solutions were presented that encompassed electric vehicles, drones, ground robots, and delivery apps/services – all aimed at making the delivery of that ecommerce parcel more cost effective or customer-friendly.  “What was really cool about this panel,” said Bowers at the NPF session, “was that we talked about things that are available today, or in the next 2-3 years, but also about what the last mile delivery will be like in 3-5 years, touching on innovations like autonomous over-the-road vehicles and more.”

Copies of the session’s presentations and video of the session (as well as others from the event) can be found on the PostalVision 2020 web site.

 

Keep an Eye on How Other Countries Solve the Delivery Dilemma

Dr. Andrew Tipping, North American transportation/logistics lead for PwC’s Strategy& touched on the retail component of the delivery experience.  He noted that in PwC’s annual CEO Survey, where it looks at the retail industry by segment and geography, shows that retail CEOs are apprehensive about the fast pace of change in the industry.  Tipping in the NPF/PV2020 panel said that the U.S. has a lower percentage of ecommerce sales compared to other countries, but that may be driven in the future by what we can learn from watching those other countries.  “Keep an eye on the globe,” he said, “for what is happening elsewhere, because even if it’s not being done here yet…it may be in the future.”  For instance, Tipping said that the percent of ecommerce purchases from mobile devices was around 25% in the U.S. during its 2015 holiday period, but was upward of 65% around Single’s Day in China.

 

More From the Gray Hair Advisors/PostalVision Panel

Gray Hair Advisors presented a brief synopsis of the NPF panel event in its newsletter and on its web site, and the complete panel discussion is posted on Gray Hair Advisors’ YouTube channel.

 

Save the Date for 2017!

PostalVision 2020 will continue to showcase innovation, new technology solutions, and changing trends in the end-to-end postal and logistics ecosystem.  Save the Date now for our 2017 event – March 21-22, 2017 at The Ritz Carlton Pentagon City (just outside Washington DC), and stay tuned for more information.

 

By Kathy Siviter

The comments in this blog are moderated. Each comment will be reviewed to ensure that it contains no crude language, solicitations, personal attacks, or anything that may be regarded as inappropriate is included.  In an effort to facilitate an ongoing conversation, comments will be reviewed in a timely manner. The views that are expressed in this blog are those of the individual contributors and do not reflect the views of PostalVision 2020. If you have any questions about commenting or are experiencing issues, please contact Bryan Klepacki

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