Going the Extra Mile for Last Mile Delivery

Increasingly, end customers judge providers of electronics products based upon how much they can choose how and when they receive the goods they buy. Smart OEMs are looking at the best ways to maximize experience with this “last mile” to gain consumer loyalty.

“Last mile has become a phenomenon particular in the consumer electronics marketplace,” Chris Jones, executive vice president, marketing and services, Descartes, a global provider of a software-as-service solution for deliver, told EBN in an interview. “Consumers more and more want to know when they are going to get their goods. In some cases, they are even willing to pay a premium delivery prices for the option.”    

Recent research from Business Intelligence, for example, puts electronics at the top of the list with furniture, large appliances and housewares as items that customers are willing to pay for same day delivery.

In the future, last mile services offered in conjunction with consumer electronics sales may decide the winners and the losers. This can take a variety of forms. Dynamic booking, for example, is a trend that is at least in early days right now. UK department store John Lewis, for example, offers customers delivery time windows, and charges to provide a smaller delivery window (two hours instead of nine, for example), said Jones. “Not only are you giving value to the consumer in terms of picking times, but allow them to opt into more value added premium services lets you grow your revenue,” he added.

Installation services, for larger items such as flat screen televisions and other home entertainment electronics may be another key differentiator going forward. Adding this type of customer service, though, requires that delivery employees have new skillsets and an even higher level of trustworthiness. “Finding the right people is a piece of the problem but the real challenge is around the training of those people,” said Jones. “They have to be competent in what they are bringing in and setting up.”

Although UPS and FedEx have set the bar of delivery for smaller items, the last mile delivery of larger items remains up for grabs. “Now, there is much more focus on last mile delivery, and it is putting pressure on the quality of people hired, the technology used to accurately predict what you can do in terms of delivery, and the systems in place to notify people you are coming,” said Jones.

That translates into delivery organizations needing to know more, communicate more, and offer more to the end customer. “All of a sudden, your logistics structure, whether it is in house or third party, has to do more than the basics,” said Jones. “The future is really about, for the customer, what you can do as you are ordering, and for the [OEM] what you are willing to offer customers in real time.”

Done right, last mile excellence can translate into higher profitability for the organization and a better experience for the customer. In Australia, for example, Woolworth's grocery store created an app and offered customers a three-hour delivery window. “Their customers were incredibly satisfied by this,” said Jones. “Their business is up 50% but call center volume is down 50%, because they created a closed loop environment.

Let us know in the comments section below on how your organization is tackling last mile delivery. What do you think the future holds?

— Hailey Lynne McKeefry, Editor in Chief, EBN Circle me on Google+ Follow me on Twitter Visit my LinkedIn page Friend me on Facebook

1 comment on “Going the Extra Mile for Last Mile Delivery

  1. pchristine
    September 21, 2015

    Thank you Hailey for this insightful article about the potential and the challenges of last mile delivery services.

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