Report: Online Shopping Experiences Disrupted by Last-Mile Delivery Delays
Online grocery sales reached nearly $98 billion in the U.S. last year. Restaurants and home essentials sellers also saw incredible growth. While demand for the local delivery of goods purchased online continues to skyrocket, a new report finds that persistent delivery disruptions in the last mile threaten to impact customer retention and blunt long-term industry growth.
According to a report conducted by Researchscape on behalf of Anyline, 44% of consumers say delivery timeframes have gotten slower since the start of the pandemic, and 68% have encountered delivery delays.
The speed of delivery continues to be the No. 1 priority for consumers, with shoppers placing the greatest importance on deliveries arriving consistently on time. Anyline’s report indicates that consumers value speed and consistency over other delivery benefits, and that younger shoppers, in particular, are willing to leave a brand after a poor last-mile delivery experience.
While those challenges haven’t impacted the last-mile delivery space so far—business-to-consumer parcel deliveries rose by roughly 25% in 2020, with 10% to 20% growth expected to remain post-pandemic, according to research from the World Economic Forum—last-mile logistics companies will need to invest in new technologies if they hope to see continued growth.
“Many consumers say they still face many problems with last-mile delivery, like receiving damaged packages or falling victim to porch piracy,” says Anyline CEO Lukas Kinigadner. “Knowing that most shoppers will think twice after a single bad delivery, retailers should focus on getting the basics right.”
How brands can get last-mile delivery right
Kinigadner suggests that brands dial back on investing in “futuristic technology” when it comes to delivery, and instead focus on getting the basics of last-mile delivery right in order to strengthen the customer experience overall.
Ninety-six percent of respondents in Anyline’s survey indicated they would find GPS tracking useful when awaiting deliveries, and 88% said they desire the ability to redirect deliveries en route. Far fewer consumers said they’re hoping to see more eye-catching or futuristic technology used in last-mile delivery, like drones and autonomous delivery robots.
“[This] signifies that overall, consumers want delivery experiences that ensure they have peace of mind while their package is on the way, with less emphasis on the delivery mechanism that gets it there,” he says.
Considering that last-mile delivery already accounts for over 25% of overall delivery costs, Kinigadner says it’s never been more important for retailers and logistics companies to integrate the kind of technology that actually serves customers. An example of that might be harnessing technology to enable real-time communication with customers about pending deliveries or notifications of packages leaving the depot.
Younger consumers, in particular, say they have less patience for poor delivery experiences. Seventy-two percent of Baby Boomers say they would reconsider shopping with a company again after a poor delivery experience, compared to 76% of Generation X’ers, 81% of millennials, and 86% of consumers in Generation Z.
“Seven in 10 Millennial and Gen Z shoppers are willing to pay more than $10 for same-day delivery, while half would also pay $10 for next-day delivery. By comparison, only four in 10 Baby Boomers would pay this amount for same-day delivery,” Kinigadner says. “This goes to show that retailers and e-commerce businesses looking to compete with Amazon might be able to achieve this without cutting into already thin margins. According to our survey insights, focusing on younger customers could be the solution.”
As consumer needs continue to evolve, Kinigadner believes retailers and logistics companies should focus on increasing transparency throughout the delivery process and look for ways to give consumers more control over their packages.
“What is clear from the findings of this report is that customer sentiments towards last-mile deliveries are shifting dramatically, especially among younger consumers who instinctively reach for their phone to inform, compare, and complete their purchases,” Kinigadner says. “As consumer opinions continue to change, brands must adapt in lockstep with them.”
Stephanie Miles is a senior editor at Street Fight.