Flexible parcel delivery will become the norm

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In 2018, we see shopping habits continue to evolve as more consumers switch between online and in-store and also between the devices they use to both research and buy goods. This leaves retailers and carriers with the conundrum of fulfilling those ever-evolving requirements.

 

We all know that consumers are spending more time online and equally across different devices, constantly switching between devices throughout the day. Research shows that consumers often see an ad or search for a product on their mobile and then purchase on their desktop later, or vice versa. In fact, according to GfK: “41% of consumers switch between devices to complete a single activity.” This changing behaviour is also reflected in their desire to get their parcel delivered where, how and when they want it.  Gone are the days when parcels were simply delivered to the home or work, now there are multiple delivery options and collection points. Whilst great for the consumer, it does cause a headache for the carrier companies tasked with meeting this fluctuating and sometimes unpredictable demand.

 

To this point, carrier DPD has just launched a new digital awareness campaign #LawsofDelivery which features eight 20 second video clips that highlight many of the common problems around delivery.  While it was slightly tongue in cheek, the problems highlighted are common to all consumers who order goods for delivery and showcase the frustrations that we all feel when it comes to parcel deliveries and the challenges carriers face making sure that delivery meets consumer expectations.

 

As consumer demands change around delivery so we are finding that weekend deliveries are becoming more popular.  In fact RetailX findings in IRUK Top 500 2018 research found that 59% of the Top 500 retailers offered next-day delivery, while 28% offered Saturday delivery.

 

As a result this means that carriers have to look at their delivery service in different ways. For example, in the last couple of weeks DPD has taken on more drivers. The company says it is delivering 40% more parcels at weekends than it did a year ago, as more online retailers promote Saturday and Sunday deliveries. Online shoppers increasingly expect to get their goods the next day, regardless of when they make the purchase.  Likewise many customers now specifically request a weekend delivery because they want to be sure they are going to be at home to receive it.

 

DPD will initially take on more than 600 part-time employed drivers, while creating 100 warehouse jobs in regional depots to support the expansion of its weekend service. It expects that within a year it will have taken on more than 1,000 new weekend drivers to meet rising consumer demand.

 

Likewise DHL Parcel has just announced that it will be expanding its services in Germany, and introducing preferred delivery times for recipients of any DHL shipment – effectively enabling recipients to decide when they want their parcel to be delivered.  DHL has been using its preferred time option for shipments when e-tailers offer the service as a shipping option in their shops. Now DHL will be introducing the option of booking a preferred time for any delivery regardless of the e-tailer’s shipping offering. In the introductory phase, recipients will be able to book an evening delivery within a three-hour window from 6pm to 9pm in 20 German conurbations. The service options are expected to be extended gradually.  DHL’s aim is to further align the delivery of parcels with the needs and wishes of the parcel recipient, however customers will have to pay a premium for the new service.

 

So as online shopping booms, so our expectations have changed from weekend deliveries to flexible shipping options and now to autonomous delivery.

 

Parcels delivered by robots – surely that is just too Sci-fi to become reality?  Apparently not, according to consultant McKinsey & Co, it predicted in 2016 that within a decade 80% of all items would be delivered autonomously.

 

One company that has caught my attention recently is start-up Starship Technologies. This company has been running a number of delivery trials, as it looks to see how its robots fit into the world of delivery. Delivering takeaway food orders and parcels for up to two miles, a small fleet of 10 to 15 robots – with human handlers – are quietly testing a game changer in ‘last-mile logistics’. However, the fact the machines still turn heads, and must be accompanied on journeys by handlers, suggests to me that the future of fully autonomous delivery is not here yet. But it is on its way, and faster than the robots’ top speed of 4mph might suggest.

 

Last month Starship launched a trial “plug and play” service in Milton Keynes to offer autonomous delivery to any business owner for a small one-off cost.  However the potential impact on the parcel delivery and logistics industry from an economic, productivity and employment perspective I think is still unclear.

 

In my opinion technology only replaces people when it is more profitable for it to do so – and even then it creates more, new and often better-paying jobs. A Centre for Cities report this year found that there were 60% more jobs in most UK cities now than there were in 1911.  So far from job losses, new start-ups like Starship could contribute to a net increase due to efficiency gains and industry growth.   That is our philosophy and what we aim to do here at NetDespatch with our SaaS parcel shipping technology.  We automate the process so that it is more streamlined and efficient, removing the need for manual intervention and, more importantly, the risk of human error.

 

The delivery world is evolving at pace and who knows when we will open the door to a robot rather than a postman or a delivery driver?  For now I can certainly see more flexible delivery options and 24/7 deliveries happening as the world of ecommerce and parcel delivery continues to transform.

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andrew@c8consulting.co.uk'

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