Next-day delivery and same-day delivery are hot shipping topics. And they impact shopping. Their use will grow for the foreseeable future.
First, these are a few of our posts related to delivery (shipping). Transforming Logistics. What’s Ahead for the Subscription Box Service? Is Uber Eat(s) Setting Itself for Defeat?
Background
For a long time, buyers knew mail and deliveries would take days or weeks. In fact, the U.S. Postal Service dates to 1775! Ben Franklin was the first Postmaster General. Due to limited shipping options, mail and package delivery were slow.
In the past 110 years, the USPS has gained a lot of competition. Two of the best-known private delivery firms are UPS and Fed Ex. UPS started in 1907, Fed Ex in 1971.
In 1964, Xerox introduced LDX (Long Distance Xerography). This was the first “commercial” fax machine. It worked over phones. Fax use soared with the development of faster-speed modems. Today, faxes are largely replaced by E-mail, texts, and other online formats.
In terms of package delivery, three trends dominate. (1) Higher-speed shipping modes exist. (2)Other firms emulate the Fed Ex hub-and-spoke regional network system. (3) Resellers such as Amazon have their own regional warehouses.
Adding Delivery Options
Throughout the latter part of the 20th century, delivery options rose.
In particular, consumers could choose from three options. Regular delivery. 3-5 business day delivery. And 1-2 business day delivery. USPS, UPS, and Fed Ex — respectively — were the leaders for each of these options.
But in 2005, Amazon disrupted consumer delivery expectations. It introduced Amazon Prime. J.P. Mangalindan reports for Fortune. “Amazon Prime aimed to get customers to increase spending. For $79 a year, members got free two-day delivery on unlimited items.”
And wow, Amazon Prime has grown. For instance, see the chart from Statista and Business Insider. Note: Today’s annual cost is $99. It includes streaming video and other services. U.S. Amazon Prime members total 85 million in 2017.
Next-Day Delivery and Same-Day Delivery
In recent years, delivery options have further evolved. Next-day delivery and same-day delivery are key choices.
USPS, UPS, and Fed Ex pioneered next-day delivery. Today, express mail service (EMS) exists in 190 countries. EMS promises delivery in as little as 1 day. In the U.S., EMS takes 1-2 days. EMS has earned a strong following. Remember, Amazon Prime promotes 1-2 day delivery. It relies on USPS, UPS, and Fed Ex. But, Amazon keeps adding its own delivery services.
Years ago, same-day delivery started at the local level. Think food delivery and prescription delivery. It took time for large firms to see the advantages. In addition, big firms found same-day delivery costs to be too high.
20 years ago, Webvan (an online grocer) began same-day delivery. It started in 1996 and went bankrupt in 2001. At its peak, Webvan served 10 U.S. cities. Most were in California. Due to high expenses, Webvan had lost $800+ million. On the other hand, we have Peapod (founded in 1989). It works with its chain supermarkets to deliver locally. It is successful.
To summarize, same-day delivery is HOT! For example, these illustrate same-day delivery services.
- Amazon Prime Same-Day and Next-Day Delivery.
- Best Buy Same-Day Delivery.
- Deliv Same-Day Delivery.
- DHL Same-Day Delivery.
- FedEx Same-Day Delivery.
- Uber Eats.
- UPS Same-Day Delivery.
Delivery and the On-Demand Economy
In short, delivery options transform shopping. At the same time, consumer expectations soar. At any rate, we are in the on-demand economy. To this end: See it. Want it. Buy it. Then, get it immediately. All in all, no matter where we shop.
According to Robert Memery of 2flow, an Irish logistics firm:
“I have produced an infographic analyzing the on-demand economy. It offers advice to firm about short delivery times. This is important if they want to keep happy. 43% of shoppers report post-delivery satisfaction is influenced by whether purchases were delivered on-time? Same-day or next-day delivery might not be possible for some firm. But, it’s vital that all firm try to reduce delivery times. Long delivery times are a killer.”
Look at the infographic for a number of insights.
In today’s markets, online shopping has taken over as the preferred method of shopping. The only reason retailers are still alive is because of the idea of people wanting something immediately after they buy it, so they go to the store. However, if same day delivery becomes common and practical, conventional retail stores will have their days numbered. Same day delivery will continue to have a huge impact on business and our economy, and businesses need to be ready to conform so that they are not left behind.
Stores still account for 90% of sales. 🙂
It is interesting to see how much online shopping has grown. Consumers are practically spoiled nowadays with how easy it is to receive an online order in just a matter of days, or even one day. This very relatable though because just a couple weeks ago I was looking for a gift to be delivered to my dorm in only two days. I thought it would be difficult to find a website that could provide this service, but I was wrong. I had multiple websites to choose from, so I only had to pick the website that offered the lowest price for two day shipping. My package ended up arriving in two days and, despite the higher price I had to pay, it was worth it because I was a satisfied customer.
As shown by the Business Insider graphic at the top of the post, people who belong to Amazon Prime spend more money on average than those who are not prime members. I believe this has to do with the convenience of same-day and next-day delivery. People have increasingly busy lifestyles and are willing to pay for membership if it means their items land on their doorstep instead of spending time to shop in-store or waiting a week for regular shipping. Consequently more and more businesses are introducing reduced wait times, and will continue to do so to meet consumer expectations that have evolved from Amazon Prime, USPS, UPS, and Fed Ex,
I have no doubt that online shopping and same/next day shipping will completely eliminate stores and malls in the future. Online grocery shopping and delivery is already a huge help to people in heavily populated areas, like cities, and Amazon Prime is pretty much one of the greatest things to exist. The only issue I could see that would prevent online shopping from taking over would be the fact that some people like to physically try their clothing on before purchasing. Other than that, there’s nothing stopping most people from paying an extra couple dollars for fast shipping and being able to shop from the comfort of their homes.
Same-day delivery has made online shopping even more enticing to the average consumer, but until there is a major breakthrough in technology, in-store shopping will remain supreme. The convenience of online shopping is unmatched, but it cannot compare to the reliability and consumer preference of going into a store and buying goods in person. While in 20-30 years online shopping may completely take over, we as a society are not yet at this point
Next-day or same- day delivery really is a huge game changer. I know when I shop online, I immediately look at how long it will take to be delivered. If it is more than 5-7 days, I 100% won’t purchase it online because I am impatient, as most consumers are. Amazon Prime is so convenient and I love how fast and reliable it is. Same day delivery will definitely continue to grow rapidly and I believe eventually all companies will provide on demand services.
Same-day delivery and next-day delivery sound attractive to the customers who like shopping online. However, the fact is that the order needs to be processed at the beginning. The processing of orders always take more than two days in America, so even if the delivery become faster, the waiting time is still long. In China, the online shopping is prevailing, and the corresponding delivery is excellently convenient. The online shopping malls take advantage of their own delivery system and the advanced delivery companies. The most important thing is that the order are always immediately shipped after being placed. For me, I do want the delivery business could develop faster in America so that I don’t need to wait so long.
Fast delivery is important, but not everything. I personally have Amazon Prime and got it for the fact that it has the free 2 day delivery option; however, I also shop on the Wish app often which takes almost a month to get delivered to me, but the prices are insanely low (the last thing I bought was $1.00 including shipping), so it’s worth it. I think student consumers are good at finding the best deals online to fit their preferences, whether it be fast delivery to get a book by a deadline or to get necessary home/dorm items for as cheap as possible.
good marketing observations
While retailers still account for 90% of sales, I expect to see this number drop if same day shipping becomes more popular throughout the country. If somebody can sit in the comfort of their home and purchase items that will be delivered to them later on in the day, it almost seems too convenient to be true.
It’s pretty crazy to see how quickly the stores that do not have online buying or fast delivery options are being crushed by the ones that do. I can honestly say that before I look anywhere else, Amazon is always my first choice. I refuse to order anything that is not eligible for prime, because that means it will take more than two days. It’s hard to imagine having to go out and look through aisles for a purchase, or wait weeks until something came when I need it instantly. The convenience that next-day or same-day shipping provides is extremely helpful to not only consumers but to retailers as well.
Same-day delivery is evolving and it is the way of the future. Amazon have a concept of same-day that ship their product via drone. This idea is a little ahead of itself and there are restrictions to flying drones. Uber eats is also a great concept of same day delivery and they are capitalizing on the change of consumers. People want things now. They don’t want go out buy stuff. Same day delivery is going to be on the rise and we will see a lot of firms trying to capitalize on the market.
Online shopping has been around for a while but I feel as if it has only got truly popular within the last 10-15 years. Companies like Amazon allow consumers to browse for goods from the comfort of their homes. Moreover, they provide a platform where people can compare prices and receive advice from other buyers in the form of reviews. One day and two day shipping however, are major changers of the game. One of the largest appeals of regular stores is that fact that you get what you are looking for right on the spot without having to wait; that is why they account for 90% of sales. Now, with the option of same day shipping, people have similar opportunities. There has even been talk about Amazon using drones to deliver packages right away to consumers. While this is a ways away from being fully developed, such an innovation may truly narrow the gap between online and in-person shopping.
I believe one of the most important factors in online shopping is the amount of time it takes for a product to be shipped. I personally use Amazon at least once a week because of its convenience. When i think of something that i need i search it and click buy now and between 1 to 2 days its sitting on my front porch waiting for me. We now live in a world that shipping that takes 5-7 business days is looked as a long time. Which is crazy because just a few years ago that was the only option and we even thought that was convenient. What’s next drones delivering are packages a few hours after ordering?
As stated on a prior post technology is vastly expanding and somewhat unpredictable. Same day shipping is starting to become a luxury but I can see it becoming the norm in later days. Advances in technology, streamed lined systems and closer retailers could lend to extremely fast delivery dates. It would be interesting to see Amazon drop the “Hour Drone Delivery” in the not so far future.
Entering into the age of immediate shipping has its fair share of pros and cons. In the case of pros, people enjoy getting their orders fast and same day delivery meets the demand. Cons would be the cost and actual feasibility of getting the package to the customer in time. Especially if something can be bought somewhere else with a better shipping policy, companies have to compete with that. So I think in the next few years, shipping will become more and more important for companies to consider when selling their products.
People today want the convienince to order something online and get the item the day of or the next day. Amazon prime has become very popular with their 2 day shipping. I think it would be great for a one day shipping or same day shipping as it will make many people very happy and save time for people to go out and shop and wait on lines.
I love the idea of faster deliveries. A user might engage in online spending more frequently if they have a quicker response. The difficulty is actually getting the packages delivered from a central location. Scaling the logistics to support same-day delivery is a very difficult problem. One could try to crowd-source deliveries but doing so safely and economically would still be a difficult task. Another idea would be to automate the process, and drone delivery could be a method. However, I think we will see real progress in finding a solution to this problem once self-driving cars are ubiquitous and equipped with the ability to deliver packages.
While I love and have used in the past same day deliveries, I feel as though the weight on the transportation is too much. Already the amount of gas and fuel used in package delivery carries a heavy burden on the environment. In a society that will soon be collapsing on itself with the lack of resources to maintain lifestyles as we know them there is no necessary reason for same day deliveries unless from places of storage that are reasonable to receive from. Additional strain is tiring natural resources, and if companies that claim to be eco-conscious as they claim to be such as google truly considered these factors, same-day delivery shouldn’t be widely available.