Welcome to our latest eCommerce and logistics news roundup!
Autumn has officially arrived in North America and with it peak shopping season. This early start might not be an aberration but rather our new normal in a year that completely re-configured what normal means from logistics and eCommerce. There are some worrying signs that merchants could face challenges and as always costs will be an issue, with surcharges already announced. Will it be a breakthrough season for small and medium sized sellers?
The big players are certainly making their moves with some interesting end of the year developments in last-mile delivery that hint at what to expect in the future. Speaking of the future, will eCommerce even exist? We mean the word! Not the industry.
Let’s take a look at the stories! And, in case you missed our last logistics roundup, you can still read it by heading over here.
The Holiday Shopping Season Has Already Started (and that could cause delays)
It’s not even October yet, and 50% of Americans have already started their holiday shopping online according to a survey from payment solutions company Affirm.
Affirm found that seven out of 10 respondents are more likely to buy something on sale now, rather than wait for those discounted days around the Thanksgiving period. Experts attribute this shift in part to the growing popularity of e-commerce, with shoppers increasingly likely to take advantage of convenience over savings.
This early start to the season could be a sign of things to come according to consulting firm Alixa Partners.
"The traditional November-December holiday-season definition is meaningless this year — and, I would argue, for the future as well," Joel Bines, who co-heads AlixPartner's retail practice, said in the release. "For years now, holiday sales have been pulled forward earlier and earlier, thanks mostly to the explosion in online shopping. This, in turn, has led to such things as the diminishment of Black Friday, of door-buster sales and of many other traditions."
The early start to the shopping season might be an indication that we’re in for a busier season, which means that merchants need to be prepared, as some experts are predicting ‘there will be failures across every carrier.’
In order to prepare for the surge in e-commerce orders, some consulting firms are advising companies to diversify the number of carriers they work with, as well as to try and encourage customers to buy weeks in advance, instead of on historically busy periods like Black Friday and Cyber Monday.
Easyship Take: Obviously we fully agree that merchants need a multi-carrier solution to avoid potential problems. By providing customers with choice and full price transparency at check-out, they can mitigate any potential problems. But, there’s a lot of uncertainty in the air this season, and there are bound to be issues, there always are with logistics. So it’s best to make sure that you are prepared to communicate any issues with your customers so they understand what’s going on with their orders. The post-purchase experience, and especially tracking are critically important, so make sure you have your strategy in order.
Amazon Expands Delivery Stations to More Suburbs
Shoppers expect fast delivery, that’s not a secret. Amazon continues to build out their logistics and fulfillment infrastructure to meet the customer demand for same day delivery. According to Freight Waves, the eCommerce giant will open up 1,000 more delivery stations in American suburbs for hyperlocal logistics and delivery. The stations will be located in high-density neighborhoods to service same-day and 2-hour delivery.
Amazon’s plans will likely impact delivery partners UPS Inc. (NYSE:UPS) and the U.S. Postal Service (USPS), which on a combined basis handle the remaining one-third of Amazon’s traffic. In the future, UPS and USPS will mostly be called upon to support Amazon’s delivery surges, Jindel said. Still, UPS will get its fair share of Amazon’s volumes because they will grow so exponentially that it will be nearly impossible to self-handle it all, Jindel said. Amazon is UPS’ largest individual customer.
With the continued growth of eCommerce, last-mile logistics will continue to evolve as companies work to meet customer demand for faster delivery. Case in point, cosmetics retailer Sephora has partnered with Instacart to provide same day delivery in select metro areas.
“We’re always looking for unique, yet practical ways to meet our clients at every touchpoint. Now, more than ever, we know they seek ease and convenience. With our Instacart partnership, we can offer a new same-day delivery service option to our existing clients and also introduce some of the benefits of being a Sephora client to Instacart’s marketplace,” said Carolyn Bojanowski, svp and gm of e-commerce for Sephora.
So where are things going in the next few years? According to Cambridge Capital managing partner Ben Gordon, there’s a lot of opportunity ahead.
“Top 50 companies represent not more than 50% of the total market in last-mile logistics. Compare that to banking and finance, where the top eight control 90% of the market,” said Gordon. “Consolidation remains a winning theme. Cross-border trade and automation of that cross-border will remain a big opportunity.”
Easyship Take: Amazon has set an industry precedent that all others are going to have to follow. We expect there will continue to be further innovations with last-mile, we’re particularly interested in how green shipping develops. With our multi-courier network we’re able to provide hybrid-solutions utilizing regional couriers to meet these demands.
What is eCommerce anyway?
Observer asks an interesting question. Is it time to drop the 'e' in eCommerce? The argument goes that eCommerce has so saturated every aspect of the economy that it touches nearly every industry in some way.
The term ecommerce has, in recent years, swallowed up an array of functions that crisscross the digital landscape, including how we pay. Even so-called in-store shopping—as loaded as that term might be as we navigate COVID-19—has elements of ecommerce built into the retail experience. When you whip out your iPhone and pay for something using Apple Pay, you effectively made an online transaction even though you are physically inside a store.
In the end, nearly all aspects of modern commerce—particularly consumer-facing commerce—has some digital, electronic, or online element built into the shopping process, which begs the question: Is it finally time for us to drop the “e” from ecommerce?
Easyship's Take: The evolution of eCommerce has been exciting in a very challenging year. We've made huge leaps in adoption and innovation, and it doesn't appear to be slowing down, despite the economic challenges we're still facing. With all these innovations, there's no doubt that the way we talk about the industry will continue to evolve as well. We look forward to it!
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