The shipping and delivery industry is in a boom it might never again experience, and that’s being reflected in huge financial gains. Door Dash is the latest such success story, with CNBC noting that its recent $16bn valuations is a huge increase on its humble 2013 origins. Part of the success between rapid courier services like Door Dash, and ride-hailing apps like Uber, is the impressive technological base from which they work. Increasingly, shipping and delivery services are looking to use these technologies, with the cost vs convenience formula their first target.
Algorithms driving down costs
Providing quicker service at a lower cost is the name of the game when it comes to shipping businesses. Industry veterans LSO (https://lso.com/) note the importance of this approach in providing a service that customers are willing to pay for. Increasingly, the use of advanced algorithms and AI is helping to make this a reality for a wider number of businesses. A 2020 study published by Hindawi took this approach further, suggesting that a hand-tailored approach to serving customers individually via region will help to provide savings and improved delivery times for companies.
Expedited deliveries can sometimes come at the cost of security. The ‘porch pirate’ phenomenon, in which thieves steal parcels from unguarded porches, has become so notorious that states including NJ are legislating against this specific crime. An alternative, or complementary measure, has come in the form of GPS tracking. Using micro-trackers on parcels, shipping companies have the ability to ensure that a parcel reaches its destination and that it stays there too. These trackers can be destroyed after usage, meaning no privacy data is lost, but ultimately they ensure that the parcel remains where it should be.
According to Digital Commerce 360, eCommerce and its associated shipping grew a gigantic 44% in 2020. With those increased volumes comes increased data, and an ability to conduct ‘predictive shopping’ – a practice that Amazon has deployed since 2013, but which is now becoming more widespread. Of course, forecasting to ensure that the most popular items are within touching distance of sales points is important, but this takes that process to the next level, trying to actively predict customer trends.
If done well, it keeps costs down – short-term, urgent shipping is often more expensive – and improves convenience. This long-term aim is a reasonable goal for many shipping companies and will represent the best way of making money while keeping packages secure and prompt in their delivery.