To successfully ride the bucking growth of e-commerce, shippers and logistics service providers should avoid assuming that consumers want everything super-fast, says Kamau Witherspoon, the newly appointed CEO of Shipt, a U.S.-based delivery service owned by Target Corp.
The three main competitive drivers valued by customers when shopping online are speed, convenience and price, Witherspoon said last week at the National Retail Federation’s Supply Chain 360 conference in Cleveland, Ohio.
But speed is not necessarily the top goal.
“Generation Z puts a much higher premium on convenience,” said Witherspoon, whose employees go shopping for customers at partner retailers such as Walgreens and Bed Bath & Beyond, then deliver the orders to customers’ doors.
“Speed is important, but that doesn’t necessarily mean ultra-fast,” he said. “The pressure to strive for 15- to 20-minute delivery isn’t coming from (the consumer). They want same-day, but that’s all. They want convenient. They want predictable.”
Witherspoon noted the importance of recognizing when types of retail don’t typically attract last-minute orders. For example, one of Shipt’s partners is Party City. The typical order for party-related goods is three days in advance of the event, he said.
The future of fast delivery will be governed by a growing consumer demand for customized service, with lots of options.
“In the future, fulfillment and delivery are going to have to get more personal,” Witherspoon said. “You’ve got to meet the customer where they are. You need to get them the product they want, how they want it.”
The top executive is confident that services such as Shipt, which offer at-home delivery of goods that shoppers traditionally went to the store to buy, will continue to grow.
“Research shows customers who work at home or on a hybrid model are more likely to order online,” he said.
That market is set to continue to rise. In a recent survey by the U.S. Chamber of Commerce, 36% of middle-market companies reported having remote employees in Q4 of 2021 who weren’t remote pre-Covid. Nearly half of the companies polled said they’ve provided permanent full-time remote options, with another 42% considering the opportunity.
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