Amazon’s $800 million investment in free next-day deliveries may be making headlines, but the home delivery expert ParelHero says same-day 24/7 deliveries are the future of e-commerce.
ParcelHero’s Head of Consumer Research, David Jinks MILT, says: ‘Next day deliveries are really yesterday’s news. Where the battle for our purses, wallets and corporate accounts is really taking us is 24-hour night and day deliveries. Amazon and other e-commerce giants have fed consumers’ expectations of near instant gratification and the inevitable eventual result will be 30-minute round the clock deliveries. ParcelHero’s latest research reveals around 25% of consumers would be happy to pay at least £3 extra for 24/7 deliveries’
UK online retailers may currently baulk at the suggestion, but David says 24/7 deliveries are already commonplace in areas of China. ’Increasingly in e-commerce. where China – and in particular Alibaba – leads; the West follows. And already Alibaba-owned Hema supermarkets in Beijing and Shanghai offer a round-the-clock 30-minute delivery service that has proven highly popular with nocturnal shoppers’
And David says it’s probable Alibaba’s model can be replicated by the likes of Amazon. ‘Amazon’s Prime Now 1-hour deliveries on thousands of everyday essentials, electrical and household items are already available in cities such as Liverpool, London, Leeds and Manchester. The Prime Now service is largely sourced from neighbourhood stores and supermarkets such as Morrisons, using local couriers, in much the same way as the Hema service works in Beijing and Shanghai. It would be feasible to turn Prime Now into a 24-hour service if people were prepared to pay enough for an all-day service; and believe me, they are!’
Says David: ‘One in five consumers want pharmacy items delivered to them in the small hours, for example. And one in ten customers are still ordering things up to 3am. In a society increasingly used to instant gratification shoppers see items they must have right Now – and night owl consumers are prepared to pay handsomely for such late-night deliveries. Retailers need to wake up to the potential opportunities for increased sales and better margins. And it’s not only very local supply chain models that will work 24/7. Most national couriers offer standard overnight courier delivery. That means parcels are driven through the night to be at a local distribution centre ready for final delivery from 8am. There’s no reason why some of these journeys can’t link up with the ‘last mile’ delivery to customers, rather than then be held waiting in the warehouse.’
Concludes David: ‘Amazon spent an eye-watering $61.7 bn on logistics last year, that’s 26.5% of its net sales, because it knows deliveries are a marketing tool, rather than just a necessary evil. That’s why our research shows 78% of logistics companies expect to provide same day deliveries by 2023. For many shoppers night-time deliveries could prove a vital life line, and certainly win new sales. It won’t be surprising if the likes of Amazon and Argos, 24-hour supermarkets and pharmacy networks are soon delivering much later into the night.’
You can read the full Study on the demand for 24-hour deliveries at https://www.parcelhero.com/blog/news-updates/24-hour-vampire-economy