As parcels continue to dominate the logistics and distribution sector, the need for posts to integrate an effective pick-up and drop-off (PUDO) network for physical items is becoming ever increasingly important. Thanks in part to the continued expansion of eCommerce options, the number of parcels being shipped every day number in the hundreds of thousands of small packages and parcels are being shipped every day, putting Posts under pressure to ensure safe and secure delivery for their customers.
The problem that posts and other logistics companies have, however, is that customer expectations have increased to a level where two-day shipping is considered the bare minimum. Add to this how most people are unlikely and, due to busy lifestyles, unable to sit around waiting for a package, and the fact that returns are now a big part of the online shopping experience and the challenge for Posts keeping the parcels flowing is a little more difficult.
According to data provided by Adobe Analytics customers are often opting for a hybrid of expedited delivery and buy-online-pick-up-in-store (BOPIS), with the latter outperforming non-BOPIS options by just under 65 percent. In fact, BOPIS sales have shown a year-on-year increase of 40.9 percent in 2019, albeit that online behemoths such as Amazon are still shipping literally millions of parcels and packaged every day.
For example, The New York Times reported that almost 1.5 million online-ordered packages are delivered daily by various logistics networks in New York City alone. A staggering number of physical items that many people in the Big Apple blame for not only creating more gridlock in the city but also encouraging the trend of porch piracy.
Around 90,000 packages reportedly vanish each day, the news source said, which represents a 20 percent increase from 2015. Delivery companies are trying to solve this pain point with real-time tracking and secure delivery sites (Amazon Lockers, for instance), but there is a consensus that the logistics and distribution sector is close to tipping point.
Package theft from doorsteps and apartment building lobbies is now becoming so commonplace that opportunistic individuals will likely spend their days following delivery and postal trucks. In addition, there is well-founded concern that companies are making packages more vulnerable to theft just by simply leaving them on a doorstep as opposed to requiring the customer to take ownership of the parcel on delivery.
An additional concern is that the four-day shopping binge that is as much a part of Thanksgiving in the United States as is turkey is not only the start of the holiday season but also a period when parcel delivery numbers skyrocket. Black Friday and Cyber Monday are engrained in the shopping calendar, with 2019’s version expected to deliver around $9.4 billion’s worth of merchandise to doorsteps in the U.S alone, according to Bloomberg. That being said, parcel delivery is not obviously limited to the few shopping weeks before the end of December.
Understandably, customers expect their online purchases to arrive on the doorstep in a reasonable time frame throughout the year, which increases the pressure on the companies tasked with getting the packages to the right place at the right time.
The question that posts are looking to answer is how best to achieve the main elements of the postal customer experience – safe delivery of a package in an expedited time frame, with the added option of postal transactions in a non-traditional space.
Secure lockers, for example, are already a feature in apartment buildings and more accessible places like big box retailers, supermarkets and even some banks. However, an external network of physical lockers and access points needs to be more than just a safe and convenient spot for customers to pick up or return a package. Parcels may be the dominant driver in distribution and logistics, but posts are about more than just shipping and delivery.
On a business optimization level, an extensive pick-up and drop-off network that includes access to a variety of postal transactions – not just parcels – can benefit both the consumer and the postal operator. A PUDO network gives customers increased places to access standard postal services, but it also extends the reach of the postal operator. Expanding a post’s network of locations enhances customer convenience while alleviating the need for said customer to actually visit a physical post office. PUDO integration also means that posts can compete with other distribution and logistics companies on a level playing field, with a noted reduction in package-related risks and in increase in options for customer flexibility.
The key point to remember is that the customer experience has evolved to a level where there is an expectation that all goods and services are available on a 24/7 basis. Package delivery aside, the digitalization of society means that posts have to provide traditional services in an increasingly modern world. A PUDO network equips the prudent post with an ecosystem that delivers what the customer wants when they want it. And while there is no guarantee that porch piracy will ever be stamped out, posts that pull out all the stops to provide an enhanced service will be the winners in the long run.