Personalized Delivery: Consumer-Scheduled Deliveries
by Peter Connolly
The growth of ecommerce is often attributed to the convenience of shopping without needing to physically enter stores. As ecommerce orders have skyrocketed in response to consumers’ love of convenience, a new inconvenience has risen in managing this abundance of volume. Porch theft, “signature on delivery,” and apartment buildings with no front desk are all major factors consumers consider when ordering online. These variables can trigger stress around changing one’s schedule, which brings us full circle: having to rearrange our routine or experiencing any inconvenience negates the value in ordering online in the first place. Fortunately, this trend has introduced new opportunities for ecommerce retailers to provide a buying experience that consumers love and, in some cases, even lower the cost of shipping.
It’s critical for retailers to recognize that they are the captain of the ship while carriers are merely the vehicle. According to Convey, “73.6% of consumers reported delivery is most important to the overall shopping experience.” While a package may ultimately be delivered at the hands of the carrier, retailers are in the driver’s seat when it comes to creating a shipping framework that yields customer satisfaction.
Three key elements to this framework include:
- a diversified carrier mix,
- carrier performance data analysis, and
- the execution tools to act on carrier data insights.
This stack can enable a wide range of delivery options at checkout that won’t break the bank. For example, historical data can point to ground services that will meet delivery SLAs in certain scenarios, eliminating the need to pay the premium on a guaranteed service. Beyond increasing margins, having multiple delivery options has even become a purchasing factor for 76% (up from 64% in 2017) of shoppers. Therefore, providing the right shipping experience has become a critical measurement in both cost per acquisition and lifetime value.
Ancillary Services, Delivery When You Want It
Fenix Commerce produced a data-driven strategy of exposing delivery date and cost options at checkout driven by real-time ratings. Their results have been fruitful, earning them clients such as Tailored Brands’ Men’s Wearhouse and Jos A. Bank. Other companies, such as Fetch Package and Sealed, have taken a more capital-intensive approach.
While Fetch currently focuses on apartment buildings and Sealed has launched with San Francisco residents and brands, each company provides the same service: send all of your packages to a 3rd-party business address, then schedule a single delivery within a one- hour window at your convenience to get your packages delivered to your doorstep. Fetch works with large-scale property managers such as Pinnacle and Invesco; Sealed has managed packages for Target, Best Buy, and Home Depot. All of this suggests that “delivery when you want it” is more of a macro trend than a micro trend for a specific category or vertical.
Ultimately, consumers’ evolving expectations around package delivery present retailers with a new strategic point. As Ware2Go recently reminded us: “In a world where shoppers can browse and compare an endless supply of products simply by clicking a button, merchants are being forced to reevaluate what ultimately drives an online customer to make a purchase.” While flexible delivery has yet to supersede fast or free delivery as the hot topic in shipping, the early success of companies such as Fenix and the variety of consumer categories being delivered by Sealed are both concrete indicators of the trend. Rather than seeing an obstacle, retailers can opt to be early adopters of this trend and capitalize on the opportunity to make their customers happy — and come back for more.
The What
Consumers are beginning to show a preference for flexible delivery options over fast or free delivery, even if they have to pay for shipping. Consumers want to control when they receive a purchased item in order to optimize the convenience of shopping online. While all retail categories are affected, these categories are the most likely to be impacted:
- Gifts
- Bulky Items (furniture, electronics, decor, kitchen supplies, exercise equipment)
- Floral Arrangements
- Groceries
- Subscription Boxes (often contain essential items)
At the partnership level, software platforms can capitalize on this trend by analyzing delivery preference data across their customer base and optimizing delivery options by SKU, buyer demographic, or regional data points. 3PLs can leverage delivery preference data to optimize for efficiencies such as fulfillment SLAs, carrier pick-ups, and resource planning. Both software platforms and 3PLs will benefit from providing added flexibility and enhanced customer experience.
The Why
According to Convey, “52% of shoppers prioritized guaranteed delivery dates over free shipping.” Consumers usually order online because it’s more convenient than going to a store. When you have to send orders to your office, rearrange your schedule to meet the carrier, or go to a 3rd-party pick-up location after a missed delivery, the order then becomes more inconvenient than going to a store in the first place. Below are staggering statistics that indicate a need for “delivery when you want it”:
36% of Americans
have had a package stolen from outside their home at least once
90,000 packages are stolen
daily in NYC
$333 million in potential lost revenue
by retailers due to delivery issues during the holiday season, as well as another $1.5 billion in potential lost revenue if customers have a poor experience and churn
66% of supply chain leaders
are held accountable to CX metrics
Beyond porch theft and the annoyance of missed deliveries, other weighty factors include growing concerns about the environmental impact and infrastructural inefficiency of fast delivery as well as multi-merchant orders (ie. a dresser from IKEA and the required wrench from Lowe’s should arrive on the same day.) Consumers are entering a “post-fast-delivery- addiction” state of consciousness and it will benefit all parties to embrace the movement.
The How
The factors that have contributed to the rise of “delivery when you want it” are conditions most commonly found in cities: delivery difficulty at apartment buildings, high rates of porch theft, busy work schedules, and concerns of eco- consciousness. It is most likely that retailers will simultaneously provide flexible delivery options across their customer base and incorporate demographic data around preferences to optimize the underlying carrier and service level mix and shipping pricing model. Retailers will find themselves ingrained in the lifestyles of their frequent buyers as consumers come to find a reliable routine with online orders. To further drive LTV (Lifetime Value), retailers will be able to upsell based on consumer’s delivery habits (ie. grocers can offer a new smoothie for Monday deliveries or an in-season fish for Saturdays.) This trend can develop in a way that both improves profits for retailers and makes the lives of consumers easier.
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Author Bio
Peter Connolly manages software partnerships at EasyPost. He loves helping partners and merchants unlock new business potential with the freedom that's intrinsic to ecommerce software. Outside of work, he spends his time skiing, traveling, and enjoying life with family and friends.