package delivery
package delivery

last mile trends

After e-commerce skyrocketed in 2020, it was hard to imagine that 2021 would be an even crazier year; a year in which new records have been broken, especially in the first quarter. With the pandemic, ordering online has become part of our routine, and as a result, carriers have had to deliver more packages than ever before.

Unprecedented record volumes have forced shippers and retailers to get creative. From this perspective, Sendcloud  predicts how last-mile delivery will change in 2022.

Robots and drones revolutionize deliveries 

Every second 3,248 packages are shipped around the world and, if  forecasts are true , the global volume is expected to double by 2026. Keeping up with growing parcel volumes and consumer demands requires a modern approach, so it is essential to adopt new technologies and smart solutions. For this reason, a growing segment of retailers and carriers are beginning to experiment with robotic delivery in the form of self-driving vehicles, drones, and autonomous delivery robots.

Although it may sound like science fiction, practical implementations are coming in the near future. E-commerce giant Amazon has already invested around $530 million in self-driving car startup Aurora to change the way packages are delivered. But he’s not the only one. Without going any further, this summer  Restalia Holdings began pilot tests  to deliver food from its TGB-The Good Burger restaurants in Spain using drones.

Although delivery robots are still in their infancy, we will have to get used to the fact that the delivery man will disappear in the near future. Even now, we see it less and less due to the boom in package lockers.

Flexible delivery as standard 

It is not surprising that consumers are becoming more demanding. Today, they want to choose for themselves where, when and how the order is delivered. As a result, the demand for same-day delivery is growing rapidly, with same-day and instant deliveries estimated to reach a  combined 20% to 25%  percent share of the entire last-mile delivery market by 2025.

However, this is just the beginning, with 85% of consumers saying that flexibility in delivery options is important to them and another 78% even prefer to change the delivery time slot when a package is already on its way. To make a purchase, the consumer wants to be able to choose: next day delivery, same day delivery, sustainable delivery or even the established day, according  to the consumer study  carried out by Sendcloud.

To meet this demand, carriers are increasingly offering premium delivery services. For example, Royal Mail started delivering on Sundays from March 2021 and DHL has launched an app to put customers’ deliveries at their fingertips. The new Budbee company is reinventing the entire delivery experience by offering customers complete freedom through its app. Ultimately, the trend towards flexibility can no longer be ignored.

Address intelligence, the key to success 

With the increasing volume of packages, delivery errors are becoming an increasing problem. The inability to deliver a package not only causes frustration for consumers and couriers, but also comes at a significant cost. Big Data can help make the last mile more efficient and increase delivery success.

To balance the cost-service ratio, parcel carriers need to control delivery costs at the customer level: which deliveries and customers are really profitable? Address intelligence can help identify alternative delivery (and return) networks and options for specific areas. For example, in the center of Amsterdam most houses are empty during the day, so it doesn’t make sense to send a delivery person during business hours. Based on ‘address intelligence’, it is more efficient to offer overnight delivery.

A simple way to apply it is to identify in the first phase of the purchase process how the customer wants to receive his package. As early as final checkout, retailers can see how you want it to make sure logistics processes are adjusted accordingly. In this way, both online retailers and carriers can adapt their supply chains to be more efficient.

Green Deal urges investment in sustainable delivery 

Green delivery has been a hot topic for years. However, with the signing of the European Green Deal in July 2021, the search for sustainable delivery methods is more urgent than ever. In this pact, European countries agreed to strive to achieve a 55% reduction in emissions by 2030, a first step towards carbon neutralization, set for the year 2050. One of the ways to achieve this ambitious goal is to reduce emissions of delivery trucks by 50%.

It is not surprising, then, that many carriers are investing massively in making their operations compatible with the environment. For example, DHL has invested this year in its first electric trucks, and DPD wants to introduce only vehicles that emit little or no CO2 in the 225 largest cities in Europe by 2025. However, there is still much to be gained when it comes to of this type of deliveries, so it is logical that this trend will continue in the coming years.

Race against the clock: the true importance of the deadline

2021 has definitely been the year of the express delivery man. Groups like Zapp, Getir, Flink and Gorillas have made massive inroads into European cities. What is your promise? “In 10 minutes your purchase is at the door of your house.” Millennials are using this service massively, but there are also many concerns about it. For example, to what extent is express delivery sustainable and recommendable?

In turn, we see that consumers are becoming, in general, more patient in relation to the delivery time of online orders. Whereas in 2020 consumers expected such orders within 4 days at most, they are now willing to wait up to 5 days. Consumers seem to want certain orders within a certain time, while in other cases they are quite patient. This leads to reflection for next year: what determines the expected delivery time?

Shipping subscriptions increase

With Prime, Amazon was one of the first to come up with a shipping subscription: For a set amount per month or year, consumers can enjoy all sorts of perks like shipping discounts and premium delivery options. Today, this model is offered by an increasing number of brands, such as Asos with Premier Delivery and Zalando with Plus. And it is that delivery subscriptions are proving to be a golden move to attract long-term consumers and increase conversions.

As consumers increasingly order online, shipping subscriptions are becoming more and more tempting. After all, the more you order, the greater the benefit. Consequently, by 2022, shipping subscriptions promise to play an increasingly important role in online retailers’ delivery strategy. While we are now only seeing subscriptions from large merchants and marketplaces, it will be a challenge for smaller retailers to respond appropriately.