Paul Greifenberger, President Americas with FarEye, explains why retailers must prioritize the optimization of last-mile delivery, to meet modern-day customer expectations.

When it comes to efficiently managing last-mile delivery, the stakes for retailers “have never been more important,” says Greifenberger. Retailers that invested millions of dollars in build up their brands and the in-store experience now must extend that image to the customer’s front doorstep. 

The consequences of failure are great, given that up to 70% of online shoppers would consider never again patronizing an e-tailer that didn’t fulfill its service promise. Magnifying that dilemma is social media — “Just one bad experience will be shared with at least 10 people,” Greifenberger says.

To customers, the most important concerns are speed of delivery and control of the purchasing experience. The last-mile process is highly fluid, and becoming progressively more demanding as shoppers come to expect two-day, then one-day, then same-day delivery.

For the retailer, the priority is managing the cost of service, even as the requirements grow stricter. “You can’t just take processes and make them spin faster,” Greifenberger says. Instead, retailers and delivery services must seek ways to become more efficient.

Answers lie in technology, especially machine learning and artificial intelligence, the latter of which can optimize routing to get the most out of a single truck and driver. That can mean discovering that a shipment destined for one customer can be piggybacked onto a truck that’s already scheduled to be in the second customer’s neighborhood, thereby eliminating the extra trip and maximizing use of each vehicle’s capacity. Technology also makes possible the level of visibility that shoppers expect today, as they demand a complete view of their shipments en route, right up to final delivery. “That’s a big part of customer empowerment,” Greifenberg says.