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08/12/2021

Disruptive Tech Innovations For Rising Expectations In the Last Mile

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Whenever a customer somewhere clicks the “buy” button, a veritable chain of rising expectations is unleashed. At that moment in time, customers begin expecting action — they want to see speed. Immense pressure is being exerted on a complex and multi-layered delivery ecosystem.

Whether it’s traditional small-retail, or big-box, or food and grocery, it’s all the same, at least from the standpoint of the customer’s own experience. A set of expectations pops up in their minds:

  • Online package tracking
  • Same-day/same-hour delivery
  • Curbside drop-offs and pickups

Some of these have been pre-pandemic trends which would only kick into high gear over the coming four to five years. But in 2021, they’ve become mainstream. Consumers do not expect to pay extra for any of these services.

The “buy” click, a simple action, sets in motion all of the complexity that comes with the last-mile delivery process — a highly orchestrated set of systems requiring intricate choreographies on the part of an ecosystem of companies.  Those last-mile deliveries involve the journey of goods from a transportation hub to a final delivery point, usually a personal residence.

[See also: AI-Powered Fulfillment and Distribution Targeted Research]

The “Before Covid” world has radically changed with the pandemic, and now we face a new world, “After Disruption.” In the months since pandemic-induced lockdowns began, companies tried their best to cope with changing trends in delivery to end consumers. The second quarter of 2020 saw years of growth in online retail in just three months, with Accenture expecting  U.S. e-commerce penetration for new and low frequency e-shoppers increasing by 160%.

In the months before the pandemic hit, retail home delivery had already accelerated. With Covid came a surge that was almost indigestible. The problem wasn’t merely getting products to customers. It was getting it there on time, in full, with a low cost-per-delivery, while improving customer experience.

Enhancing Customer Service While Driving Down Cost of Delivery

During the pandemic, many consumers outside Amazon Prime had a delightful delivery experience. For companies providing such great results the critical difference resulted from leveraging real-time information: driving improved customer service while lowering cost-of-delivery.

Successful companies stay inside the winners circle because they provide customers with control over key choices: time of delivery, changing the delivery time, safety protocols for drivers. For instance, being more successful with first-time delivery attempts creates positive ripple effects. This does not only lead to happy new customers, but also means far less waste.

Consider the furniture e-tailer which promises high-quality product and speed-of-delivery. It costs a lot of money to do the first delivery, and when that comes late, it creates a negative ripple. Using delivery intelligence results in far fewer late deliveries.

One e-tailer, for example, embarked on a project to improve customer experience and increased on-time deliveries to 96%, reduced delivery re-attempts by 3%, and increased order volumes by 300%. Technology is the backbone of any effort to accomplish this. Customers want visibility, which requires making it available to them, no matter what phone they have, what their age, or their capabilities.

For every product in the world, the last mile may be the final and probably the shortest distance of the journey — but it’s usually the most expensive leg. There’s one basic question that every leader must ask: How are retailers going to make their last-mile network resilient enough to adapt to fast-changing market dynamics?

Paul Greifenberger is president of Americas at FarEye Technologies Inc.

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