Mhlnews 9850 Last Mile 2 3

5 Important Consumer Demands Retailers Need to Know

April 23, 2018
The bottom line: Quality matters and consumers will pay for it.

Last mile logistics are a complex undertaking that has recently been at the forefront of the dialogue around the “Amazon Effect” and how it impacts consumers, retailers and logistics companies alike. Consumer expectations for faster delivery times are growing rapidly, and retailers are tirelessly strategizing ways to provide these services. And logistics companies are looking toward new technology to make the last mile of delivery more efficient and less costly.

Dropoff’s 3rd annual study of U.S. consumers regarding their shopping and delivery expectations proves that the demand for faster delivery isn’t going anywhere. It also reveals consumer sentiment towards traditional carriers as well as crowdsourced and peer-to-peer delivery services. The findings point to one important takeaway for retailers and logistics companies: consumers are not willing to sacrifice quality for speed.

These are five key findings from the survey that speak to the current delivery landscape, what consumers really want, and how retailers will benefit from providing same-day delivery.

1. Same-day delivery was the fastest growing expedited delivery option in the last year.

Nearly two times as many consumers say they took advantage of same-day delivery in the last 12 months versus the year prior. And consumers aren't happy when same-day isn't an option: nearly 1/3 of consumers now say they feel ‘frustrated’ when a company doesn’t offer same-day delivery.

Delivery speed has become a crucial aspect of the online shopping experience and a major decision factor for online shoppers. 53% of consumers have abandoned a purchase because of slow delivery times. That’s a lot of missed opportunity!

Over the last year, we’ve seen a number of retailers add same-day delivery to their options at checkout. In fact, Boston Retail Partners’ 2017 Digital Commerce Survey showed that same-day delivery was offered by 51% of retailers in 2017. While that may sound like retailers are making real inroads, more than half described their service as “implemented and needs improvement.”

2. Delivery expectations are on the rise.

An astonishing 99% of U.S. consumers say ‘fast delivery’ is important to them when making online purchases. And they expect companies to keep up with Amazon: 43% expect companies to have ‘much faster delivery times’ than last year (up from 35% in 2017). Fast delivery alone isn’t all consumers are hoping for, however. 75% want a more professional delivery service — and their desire is increasing (72% in 2017). And 88% want the ability to track their shipments in real-time.

There’s also a big discrepancy between how soon consumers want to receive items versus how quickly they actually receive them. This extends across many sub-sectors of retail and many product categories.

3. Yet consumers are experiencing a decline in the quality of service provided by many carriers, which influences future purchase decisions.

These mediocre experiences influence whether or not consumers will shop with that brand again. Some retailers think that once a package leaves its warehouse what happens next is out of their hands, but consumers don’t agree. The data shows that consumers believe it’s the retailer’s responsibility to choose a delivery partner that represents their brand and customer service values.

  • 57% of consumers wouldn’t purchase from a retailer again if the delivery person was unprofessional.
  • 79% percent of consumers wouldn’t purchase from a retailer again if the delivery was damaged.
  • 69% percent of consumers wouldn’t purchase from a retailer again if their delivery was late.

4. Peer-to-Peer Delivery Services and Traditional Carriers Aren’t Cutting It

As consumer expectations are rising, many of the same-day and expedited delivery solutions retailers have are falling short. Only 14% of U.S. consumers say they trust crowdsourced, peer-to-peer delivery services to deliver their packages. Even the biggest shipping carriers aren’t immune. Consumer trust in FedEx, UPS and USPS has faltered in the last year.

5. The bottom line: Quality matters and consumers will pay for it.

47% of consumers have paid extra for either same day or next day delivery. And 65% of shoppers want the same fast delivery options as Amazon — and are willing to shop from other retailers if they offer them.

Retailers who are concerned about the added cost of the service should consider this: 74% of consumers say that after receiving same-day delivery, it would make them more likely to purchase from that retailer again. In addition, same-day delivery options would encourage 1 in 2 U.S. consumers to shop online more often. There is huge potential to drive ROI by offering same-day delivery at checkout.

Delivery Solutions for Retailers

Last mile delivery can be a logistical nightmare for many retailers, often draining the company’s resources unnecessarily. Consumers who have low trust in peer-to-peer delivery services are likely to shop elsewhere when packages are late or damaged. Overall, they expect more visibility and professionalism when it comes to their delivery experience. It’s imperative that retailers work with a logistics partner that represents their brand the way they want it to be represented and holds the same customer service values.

Leveraging a professional, tech-driven same-day delivery solution can satisfy consumers’ desire for fast delivery, real-time tracking, and better care of their packages. Retailers are striving to deliver on the elevated last mile experience, and consumers can expect just that with the right same-day delivery provider.

Sean Spector is CEO and Co-Founder of Dropoff, a tech-driven same-day delivery service that provides businesses a fast, reliable and professional solution.  

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