While traditional retail isn’t dead, e-commerce sales are here to stay. Last mile service use has increased 50% since 2016, and even established brick-and-mortar chains are adopting their own immediate fulfillment services to have more control over delivery. Businesses are recognizing that being able to get their products to doorsteps at the customer’s convenience is what will make or break them.
Last mile logistics is about successfully closing the deal with the customer at the point of contact. The guiding principle of any last mile logistics strategy should therefore be to be as customer-centric as possible. Here are some things to keep in mind to ensure that your logistics strategy doesn’t let customers down:
1. Logistics isn’t just another expense
Logistics is a service function—not a cost center. Logistics and transportation are two of the driving forces (no pun intended) behind seamless availability of products and better customer experiences.
25% of businesses report that delivery efficiency is their biggest headache when it comes to last mile logistics. In today’s digital age, customers expect instant gratification. If their order isn’t fulfilled at a place and time convenient to them, they won’t care about the meticulous planning that occurred at every step of that product’s supply chain. They will only see (and remember) the unsatisfactory experience with your business. Seen in this light, any investment in improving last mile logistics is a direct investment in retaining customers. Amazon has understood this better than most, with innovations like Amazon Flex and Amazon Key intended to leave customers on a positive note with every transaction.
2. Customers want information
Millennials make up the largest consumer bracket in the US, and the digital channels through which they receive and share information have accustomed them to instantaneous updates. They are master multi-taskers, moving between multiple devices in a matter of seconds in a quest to access as much information and record as much data about their world as they can. In fact, in 2016 over a third of millennials reported that they interact with their smartphone more than they do with humans!
And it’s not just people under 35. Every smartphone owner has the power of information at their fingertips, and their increased expectations for speed and visibility aren’t limited to the news. When it comes to interacting with brands, today’s consumers want to be able to view the entire delivery process, even including inventory status updates. This is why it’s so important for businesses to have better control and oversight of their entire supply chain. If you don’t know where in the world your products are, how are you going to keep your information-hungry customers in the know?
3. Precise and personalized deliveries are the future
Although offering visibility to customers will give brands a competitive edge, this isn’t the deal breaker when it comes to last mile logistics. What customers really want is access to multiple delivery options and the convenience of deliveries that can be completed at any time and place—not just during the day or to their residence.
Last mile management solutions now offer a wide array of delivery scenarios that suit every kind of customer and lifestyle. Amazon’s drone deliveries and UPS’s proposal to use driverless cars for some of its operations are just some of the alternative transport ideas that have popped up in recent years. Crowdsourcing solutions like InstaCart connect customers to remote shoppers who pick up their groceries and deliver them at a specified time. There are also alternative delivery models like collaborative consumer storage, popular in residential communities. These electronic lockers are used by logistics workers to deliver packages that customers can access any time using a passcode.
The payoff of honoring customers’ diversified shopping habits is big: businesses with dedicated customer experience management programs across all their sales channels yield an increase in customer retention of 91% year-over-year, compared to those that are less sophisticated in their omnichannel approaches.
Supply chain professionals understand all too well the precise orchestration of people, locations, and capital required to get goods to their final destination. But success at the last mile is the only way for customers to see the result of those efforts. And the quality of delivery is ultimately how they will decide whether to remain customers or head for another brand. By understanding how today’s customers engage with brands, and making their operations flexible enough to react to market fluctuations, companies can arm themselves with everything they need to provide seamless last mile experiences for their customers.