The holiday season happens at the same time every year. We know it’s coming, but somehow most of us end up waiting until the last minute to buy gifts. And thanks to Amazon, we can now procrastinate with little-to-no consequence — the e-commerce juggernaut now offers free next-day delivery until midnight on Christmas Eve.
With over 30% of customers wanting express delivery for the holidays, retailers will need to fire up their supply chains to meet peak demand. The last-minute urgency of holiday shopping, combined with record-setting e-commerce sales, are together pushing customer demand for next-day and same-day delivery through the roof.
Big retailers are paying attention. Target has been aggressively ramping up their delivery services ahead of the holiday season, specifically focusing on curbside pickup, free two-day shipping, same-day restock and home delivery — going so far as to buy their own same-day delivery service in Shipt.
At the same time, The Home Depot has launched same-day delivery in over 35 markets and counting. Their clear-eyed focus in giving customers a handful of order options comes directly from the instant gratification and speediness that consumers increasingly crave.
It seems that consumers’ appetite for delivery have become almost as personal as their taste in spaghetti sauce. Some prefer in-store pick up, while others think next-day delivery isn’t fast enough. The race to win last mile delivery isn’t just about speed; it’s about giving customers a full menu of delivery options to fit their preferences at the point of purchase, each and every time.
For many retailers, keeping up with Amazon means doing whatever it takes to make sure customers get what they want when they want it. And the bar gets raised every year.
This year, Amazon expects to capture a record-breaking 50 percent of online revenue, which means the urgency to rethink their last-mile logistics has never been higher. As retailers are realizing that e-commerce sales grow in-line with investments in flexible delivery options, the most innovative ones are ramping up holiday delivery in three critical ways:
- Launching a Buy Online, Deliver From Store model
As e-commerce continues to transform the industry, retailers face an unprecedented challenge to extend their supply chains locally, into the towns and communities where their customers live. The deliver-from-store model allows retailers to leverage under-utilized brick and mortar storefronts in those neighborhoods to improve the customer experience, speed up delivery, and reduce overall costs. Given that logistics always evolves towards maximum efficiency, moving products and consumer goods closer to customers just makes good economic sense.
- Finding a delivery partner to handle peak demand now, without full integration
During the holiday season, timing is everything. For retailers, that means addressing out-of-stock SKUs, extending order cut-off times, and meeting delivery deadlines are mission critical to capturing every sale. Operationally, retailers also need to have product available, both to fulfill online and in-store traffic, and have enough resultant delivery capacity to make sure it all gets where it needs to go on time.
With the fast-approaching holiday shopping season, retailers don’t have the luxury of months-long integration efforts. To launch same-day delivery in time for the holidays, retailers should find a partner that makes posting deliveries as easy as ordering a pizza.
Using the right model, customers or in-store associates could set up deliveries themselves without requiring hours of development work. After the holiday season, retailers can then take the time to fully integrate successful partners their order delivery systems.
- Exploring alternative solutions beyond tech-enabled couriers
Most emerging delivery solutions are simply tech-enabled couriers with old-school problems: capped resources, limited geographic reach, and little-to-no flexibility. Because most use their own delivery vans, there’s rarely extra capacity available when retailers need to meet unexpected spikes in demand. Once the van fills up, same-day is done. That means same-day delivery might actually be next-day, unless the customer’s order is processed by 10 am on the day of delivery. In the hyper-competitive age of Amazon, these solutions risk leaving retailers and their customers empty-handed.
Conversely, crowdsourcing employees, customers, and drivers nearby stores and warehouses enable retailers to expand their delivery radius, extend same-day order times, and scale to meet volume spikes. As delivery volume goes up, the number of active drivers delivering within the system goes up as well, while delivery times and costs remain the same. That means retailers can offer true same-day delivery on those last-minute purchases — keeping their loyal customers and the tradition of last-minute holiday shopping intact.