IMRG - The UK e-Retail Association · The UK e-Retail Association The avoidable cost of failed home...

IMRG - The UK e-Retail Association

The e-Commerce & Omni-Channel Supply

Chain & Fulfilment Congress

London January 2015

Andrew Starkey

Head of e-Logistics

IMRG

www.imrg.org +44 (0)203 696 0980 @imrgupdate http://www.linkedin.com/company/imrg

www.imrg.org +44 (0)203 696 0980 @imrgupdate IMRG e-Commerce Network

The UK e-Retail Association

The avoidable cost of failed

home deliveries is falling but it still more than £430

million each year

Home delivery is

still the number on choice for 84% of UK

shoppers but Click and Collect is gaining

popularity

UK e-Retailers dispatched 920 million parcels by UK carriers

in 2014

The UK e-retail market grew 16.3%

by volume in 2014

To maximise the commercial return for all e-retail stakeholders

Original, leading edge data and insight

Collaborative community

Access and Channels with international reach


Our theme today……..

“Examining the extent to

which innovative e-commerce

delivery solutions, such as

storage lockers and Collect +

can improve efficiencies

whilst meeting customer

delivery expectations”


Or to put it more concisely

“Examining the extent to

which innovative e-commerce

delivery solutions, such as

storage lockers and Collect +

can improve efficiencies

whilst meeting customer

delivery expectations”

What works and what do shoppers want?

To Innovate

“Bring In New Ideas”

“Make Changes” Oxford English Dictionary


And a Merry Christmas to you too !!!!!!

The most challenging Christmas peak since the snow of 2010

•  Black Friday / Cyber Monday mayhem

•  On top of a record year for e-retail delivery volumes

•  City Link in administration


And a Merry Christmas to you too !!!!!!

The most challenging Christmas peak since the snow of 2010

Oct$ Nov$ Dec$ Jan$ Feb$ Mar$ Apr$ May$ Jun$ Jul$ Aug$ Sep$

2011$;$2012$ 2012$;$2013$ 2013$;$2014$ 2014$;$2015$

IMRG%Delivery%Index%0%Trend%

920$million$parcels$dispatched$by$UK$e7retailers$

$120$million$parcels$dispatched$in$

December$alone$

“Black$Friday$and$Cyber$Monday$promo@ons$

caused$‘online$tsunami’$of$demand$that$

overwhelmed$retailers$and$logis@cs$providers”$

Internet Retailing January 2015


Let’s stay focused on what makes a difference

What will increase delivery efficiency and capacity?

What will drive down avoidable cost?

What to shoppers want and we can retailers offer that will improve the online delivery experience?

IMRG Blackbay UK Consumer Home Delivery Surveys 6 year trend data on what shoppers think about e-Commerce delivery solutions

IMRG MetaPack Delivery Index 200 million deliveries over a 3 year period


IMRG Blackbay UK Consumer Home Delivery Survey 2014

0%$ 10%$ 20%$ 30%$ 40%$ 50%$ 60%$ 70%$ 80%$

Specific delivery instructions Specific delivery day

Saturday morning delivery Sunday delivery option Evening delivery option

Specific delivery time slot Same day delivery

Delivery to a ‘safeplace’ Local alternative delivery point.

Clear delivery information prior to ordering Click and Collect - Convenience store

Click and Collect - Locker Click and Collect- Retailers store

A call centre to handle delivery queries A call centre to rearrange a delivery

An 'in transit' SMS or e mail pre-delivery advice Ability to change the delivery day or location

Access to online order tracking

What%would%make%receiving%deliveries%more%convenient?%

2013/14$

Source: IMRG Blackbay UK Consumer Home Delivery Survey



0%$ 10%$ 20%$ 30%$ 40%$ 50%$ 60%$ 70%$ 80%$

Specific delivery instructions

Specific delivery day

Saturday morning delivery

Sunday delivery option

Evening delivery option

Specific delivery time slot

Same day delivery

Delivery to a ‘safeplace’

Local alternative delivery point.

Clear delivery information prior to ordering

Click and Collect - Convenience store

Click and Collect - Locker

Click and Collect- Retailers store

A call centre to handle delivery queries

A call centre to rearrange a delivery

An 'in transit' SMS or e mail pre-delivery advice

Ability to change the delivery day or location


INFORMATION%AND%THE%ABILITY%TO%ANTICIPATE%




0%$ 10%$ 20%$ 30%$ 40%$ 50%$ 60%$ 70%$ 80%$







Same day delivery












THE%ABILITY%TO%SPECIFY%



Predictable Delivery – Pre Delivery Advice

Pre-delivery advice reduces costs and drives operational efficiency: •  By avoiding ‘non attended’ delivery calls •  Avoiding customer service WISMO calls

AND •  Allows the shopper to specify ‘in flight’ •  Manages customer expectation

82%$of$shoppers$would$like$more$informaLon$about$the$progress$of$their$

delivery$

0%$ 20%$ 40%$ 60%$ 80%$ 100%$

Informing$you$about$the$progress$of$your$order$Informing$the$dispatch$date$and$tracking$number$

Warning$a$delay$with$delivery$Confirming$the$delivery$the$day$before$$

Confirming$the$expected$Lme$(slot)$$Informing$you$of$a$failed$delivery$

What%parts%of%the%delivery%process%would%you%be%happy%to%be%updated%on?%

2013/14$

0.00%$

10.00%$

20.00%$

30.00%$

40.00%$

50.00%$

2013/14$

When%receiving%pre0delivery%alerts,%of%the%following%opOons,%which%would%be%the%most%convenient%for%you?%

The$day$before$delivery$–$no$Lme$specified$

On$the$morning$of$delivery$–$Lme$window$specified$

An$update$within$one$hour$of$delivery$



Predictable Delivery – Pre Delivery Advice

Pre-delivery advice reduces costs and drives operational efficiency: •  By avoiding ‘non attended’ delivery calls •  Avoiding customer service WISMO calls

AND •  Allows the customer to specify ‘in flight’ •  Manages customer expectation

82%$of$shoppers$would$like$more$informaLon$about$the$progress$of$their$

delivery$

0%$ 20%$ 40%$ 60%$ 80%$ 100%$

Informing$you$about$the$progress$of$your$order$Informing$the$dispatch$date$and$tracking$number$

Warning$a$delay$with$delivery$Confirming$the$delivery$the$day$before$$

Confirming$the$expected$Lme$(slot)$$Informing$you$of$a$failed$delivery$

What$parts$of$the$delivery$process$would$you$be$happy$to$be$updated$on?$

2013/14$

0.00%$

10.00%$

20.00%$

30.00%$

40.00%$

50.00%$

2013/14$

When$receiving$pre;delivery$alerts,$of$the$following$opLons,$which$would$be$the$most$convenient$for$you?$

The$day$before$delivery$–$no$Lme$specified$

On$the$morning$of$delivery$–$Lme$window$specified$

An$update$within$one$hour$of$delivery$

2/3rds$of$shoppers$would$not$expect$to$pay$any$extra$for$this$service$


Only$31%$of$shoppers$have$used$/$been$

offered$pre;delivery$advice$


Predict and Specify - Click & Collect

Click and Collect provides the ability to specify and predict delivery

Three types of Click and Collect:

•  In Store

•  3rd Party PUDO

•  3rd Party Locker

Estimated 80 – 90 million UK deliveries were Click and Collect in 2014







Same day delivery













80%$would$travel$up$to$a$mile$to$collect$but$only$40%$would$travel$up$to$5$miles$

77%$of$shoppers$would$expect$to$pay$

no$extra$$



Click & Collect - Characteristics

3rd Party Networks •  25,000 locations rising to 30,000

•  Can be tailored to a retailers own store network

•  Generally charged at or below home delivery price

PUDOs •  On regular routes – a destination location

•  Staffed locations:

•  Personal interaction

•  Inconsistent customer experience?

•  Wait times could be 3- 5 minutes

•  Dwell times up to 10 days (18 days for Post Offices)

•  Delivery times vary from Same Day to 48 hours

•  More generous weight and dimension limits

Lockers •  On regular routes – a destination location

•  Very fast recovery times – measured in seconds

•  Consistent customer experience

•  Can also use for Returns

•  Consumer awareness also driven by C2X

•  Short dwell times – measured in hours

•  Potential additional costs if not collected on time

•  Delivery times vary from next morning to 48 hours

In Store •  Trip chaining

•  Generally free

•  Often generous dwell time

•  Implications for wider store operations

•  Need to minimise queue and wait time

•  Opportunities for cross sell / up sell

•  Efficient management of returns and credit

•  Control over customer experience


Specified Time Delivery







Same day delivery













A$2$hour$Lme$slot$is$

acceptable$to$73%$of$shoppers$

Only$40%$would$be$prepared$to$pay$a$premium$and$only$60%$of$those$would$go$

up$to$£2$


Specified Time Delivery

•  Offer choice

•  Weekend delivery has only increased since offered as a standard option

•  Same Day is niche

•  Next Day delivery increases in December

0.0%$

10.0%$

20.0%$

30.0%$

40.0%$

50.0%$

60.0%$

Services used as a Proportion of total UK deliveries

0.00%$

10.00%$

20.00%$

30.00%$

40.00%$

50.00%$

60.00%$

Jan$

Feb$

Mar$

Apr$

May$

Jun$ Jul$

Aug$

Sep$

Oct$

Nov$

Dec$

Economy vs Premium Year on Year

Economy$

Economy$

Specified$Day$(including$Next$Day)$

Specified$Day$(including$Next$Day)$

Source: IMRG MetaPack Delivery Index


Next innovations for the UK ?

Feedback and Learning

In flight divert to Click and Collect

Real time and immediate feedback on the delivery

experience Incentivised Off Peak Ordering

Dynamic selection of Lockers and PUDOs the evening before delivery

Utilise ‘quiet time’ logistics capacity


Next innovations for the UK ? Not so sure

Drones? •  Range

•  Restrictions

•  Weight

•  Acceptance window

•  Cost and Need

In Boot Delivery? •  Security

•  Model specific - Volvo

Consolidated delivery? •  Urban consolidation hubs

•  Consolidation for rural delivery

3D Printing for e-Retail orders? •  Forward Stock Locations?

•  Drones?

Urban$Hub$

Next$Day$

Carrier$

Economy$Carrier$

Lifestyle$Agent$

Retailer$own$fleet$


But what do I know?

Thank you

The e-Commerce & Omni-Channel Supply

Chain & Fulfilment Congress

London January 2015

Andrew Starkey

Head of e-Logistics

IMRG [email protected]

+44 7952 813622

www.imrg.org +44 (0)203 696 0980 @imrgupdate http://www.linkedin.com/company/imrg

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