What do we need from home deliveries? For them to be easy, controlled and fun!
Professor Richard Wilding OBE is Chair (Full Professor) in Supply Chain Strategy at the Centre for Logistics and Supply Chain Management, Cranfield School of Management UK, Cranfield University. In our second Industry Guest Blog, Richard looks at what customers want from the home delivery industry in the future.
In 2012 I had the opportunity to advise the BBC on a feature that went out on Radio 4’s PM show (05/07/2012) and was then published in more depth on the BBC website as the Parcel Conundrum under the magazine section. I heard from the BBC producer and reporter Andrew Bomford over the following weekend: the web page was the second most read on the following day, receiving 682,000 views in one day!
It seems we all care deeply about the home delivery market. Returning to the topic two years on, the question to ask is ‘What does a customer need from home delivery?’
Critically it needs to be easy, controlled and fun. As I wrote in an article for Postal Technologies Magazine recently, consumers want deliveries when they are in or to a place convenient to them, they want reassurance of when the item is going to arrive and where it currently is. If they are not at home, they want the parcel to be left somewhere safe or delivered to a location it can easily be retrieved from.
Perhaps the best way of looking at innovation in the home delivery sector is to actually look beyond it, to other environments. What other kind of organisations and retailers are best at delivering things to their customers? One answer might be fast food restaurants. Here is an environment where things are made as easy, controlled and as fun as possible. In fact customers don’t even have to get out of their car. The latest technology and robust processes ensure high levels of accuracy and service. As for the fun, some even keep you entertained as you queue!
So what does the latest technology and robust processes look like when applied to home deliveries? What should customers expect?
- Delivery when they are in.
- If they are in waiting for a delivery, they want reassurance of when it is going to arrive, so need transparency of where the vehicle with their parcel is.
- If they are not at home – somewhere the parcel can be left (or delivered so it can be easily retrieved)
What a retailer may want from their delivery company is:
- Proof of delivery – they want to know the parcel has reached the address and been received in perfect condition.
- The courier providing an excellent customer experience.
The latter is particularly important as generally the customer does not differentiate between the courier and the company the item was purchased from. It can be argued that the courier is the representative of the original organisation. So if the courier is seen as ‘rubbish’ the company who sells the product will also get this label. However a good delivery experience can enhance the customer experience and therefore gain customer loyalty and increase sales.
So below are a few of my thoughts of how things can develop.
Delivery to a consolidator in your area
One interesting approach is consolidation. For example, deliveries could be sent to a local consolidation centre, and then customers could collect or arrange a delivery 7 days a week with the consolodation centre using electric vehicles to deliver the final mile. Mypacelcentre in Basildon was an interesting early experiment in this area.
This sort of option also occurs at a more global level through arrangements between credit card companies and DHL. Borderlinx enables customers in the UK, for example, to make lots of purchases in the USA, then consolidate the deliveries and arrange one delivery at a set cost including tax to a UK address. This also means you can go on an online shopping spree in the USA and get a cheap single delivery for everything in one go at a set price: www.borderlinx.com
The growth in drop boxes at stores such as Argos, or even railway stations using the Doddle service, has also increased customer choice significantly since 2012.
Real-Time tracking by use of smart phones – so you know when it will arrive
The use of Mobile Technology so any driver of a vehicle (or even a cyclist or walker) can now become part of a delivery network. When ‘location services’ are ‘on’ on your iPhone, for example, you can give permission for people to know where you are. If you then know where the delivery vehicle (or person) is and where a package needs to go, an instruction can be sent. This technology also means you can know the actual location of a vehicle in real time so, for a home delivery, a customer can track the order being delivered or receive an automatic alert when the vehicle with their package is within a certain radius.
Another way real time tracking of packages is used is from a security perspective. Carriers can know precisely where an item is globally by using technology. For example Freight Watch International has a nice video which explains the concept: it is all about transparency and visibility of where items are.
Secure drop boxes at properties
Drop boxes at peoples’ homes are gaining popularity in the US, and now the UK. The ibin is an option enabling a customer to have a secure large box at their house so a courier can place the product in a lockable box. The concept is explained clearly on this webpage www.theibin.com/How-it-works.aspx
Proof of delivery
An important question for companies to ask is ‘what is the purpose of the signature’? Sometimes people send things using ‘signed for’ because they believe the item will be looked after better in the postal system and there is more traceability and transparency.
Perhaps an option of ‘Tracked’ could be used, this would involve the item being scanned through the system but then, rather than a signature being required, the item could be scanned when posted and the GPS location of where the item was scanned and posted saved. This would then mean that the sender would know it had delivered at a particular time. One organisation in the pharmaceutical industry take a photo of the front door if a signature is not available, this photo is then uploaded for proof of delivery purposes.
A number of major parcel delivery companies have introduced systems creating emails or text messages that give a predicted one hour time slot on a particular delivery day. To enable this advanced telematics is used and information on the route monitored. Improving Transparency in this way results in improved customer service and improved delivery performance.
Home delivery is good for the environment
My friends based at Heriot-Watt University did some excellent research which was revealed at the 14th Annual Logistics Research Network Conference, Cardiff. These are really interesting as you will see that even if you have to re-deliver 20 times you still create less CO2 than getting in your car and collecting it – 181 grams of CO2 per drop compared with 4274grams if you use a car! (For non food).
So the future for home deliveries should be easy, controlled, fun… and better for the environment!
For more information see Richard’s web site: www.richardwilding.info
Hear more about Richard’s ideas for the future of home deliveries discussed on Radio 2’s Simon Mayo Drivetime programme on 19 November 2014 (25 minutes in).