Warning: include(../../../FE_indexlocal.inc): failed to open stream: No such file or directory in /home/flogedelivery/public_html/magazine/HTMLheader.txt on line 18

Warning: include(): Failed opening '../../../FE_indexlocal.inc' for inclusion (include_path='.:/usr/lib/php:/usr/local/lib/php') in /home/flogedelivery/public_html/magazine/HTMLheader.txt on line 18
| On Track & On Target | Delivery Conference: 'We want it free, and we want it now'
m-hance delivery management white paper
The definitive printed and online publication for the multi-channel fulfilment marketplace

Search our million-word thirteen-year archive


Warning: include_once(): http:// wrapper is disabled in the server configuration by allow_url_include=0 in /home/flogedelivery/public_html/magazine/left-panel.html on line 18

Warning: include_once(http://flog.edelivery.net//other/StartLocal.inc): failed to open stream: no suitable wrapper could be found in /home/flogedelivery/public_html/magazine/left-panel.html on line 18

Warning: include_once(): Failed opening 'http://flog.edelivery.net//other/StartLocal.inc' for inclusion (include_path='.:/usr/lib/php:/usr/local/lib/php') in /home/flogedelivery/public_html/magazine/left-panel.html on line 18
Subs promotion


RSS   F&E RSS news feed
Click for details



Paragon Software Systems


Ceewhy Vancouver


Automated Packaging


TRUCKSTOPS from MapMechanics




TNT Express Services


Access Fulfilment


Kuehne & Nagel


Kewill Ltd


TranSend Solutions Ltd


NetDespatch Ltd


Conveyor Networks


Pack Smart Ltd


The Fulfilling Station




iForce Ltd


EC Group


Courier Software


Spark Response


POS Direct Ltd




17 July 2014

Delivery Conference: 'We want it free, and we want it now'

Warning: mysql_fetch_object(): supplied argument is not a valid MySQL result resource in /home/flogedelivery/public_html/other/routines.php on line 124

Warning: mysql_fetch_object(): supplied argument is not a valid MySQL result resource in /home/flogedelivery/public_html/other/routines.php on line 124

Consumers want free delivery, want it quickly, expect delivery choice, and are willing to experiment with new delivery options. These were among the themes of this year’s Delivery Conference, which continues to be one of the best attended and most lively of its kind. As always, it was hosted by delivery management specialist MetaPack.

Just over half of Royal Mail’s revenue now comes from parcels, Nick Landon, managing director of Royal Mail Parcels, told delegates. Moreover, surveys had indicated that consumers were spending increasing amounts online, indicating that this proportion could grow.

Preferences about delivery destinations were only changing slowly, Landon said. Royal Mail’s soundings relating to last Christmas indicated that by far the majority of consumers (82 per cent) still favoured home delivery as their first choice. Other options came in with very low percentages; for instance, "leave with a friend" and click and collect both came in at just 2 per cent.

When it came to choosing an online retailer, two out of the five most popular considerations were parcel-related, Landon said. The most popular feature was free delivery on everything, while delivery by Christmas came next. And he warned that nearly three quarters of respondents said they would not use a retailer again following a poor returns experience.

The delivery offer also had a profound impact on shopping cart abandonment, Landon said. Factors influencing retailer choice included delivery charges, the carrier being used, the delivery time, and confidence of delivery by Christmas.

Dwain McDonald, chief executive of carrier DPD and always a vigorous and engaging presenter, also harked back to Christmas, reporting that week 51 had been his company’s busiest. A total of 1.1 million items were handled in the week commencing on 15 December.

McDonald took the chance to update delegates on the advances in his company’s Predict system for pre-alerting recipients of delivery times. He said 67 per cent of transactions running up to Christmas had been on mobile devices of some kind, and 1.47 million people had use DPD’s "Track my parcel" system to follow their delivery progress. "People like locating the driver."

He said 93,00 people chose to have their parcel delivered to a neighbour, and 168,282 moved the delivery to a different destination. He added that the system was now being upgraded to allow more options, including delivery to a safe place and collect from depot.

Although his company’s service offered 100 per cent POD, he said focus groups had shown that recipients did not always want this. Therefore safe-place delivery with a photograph of the location was a useful alternative. He added that drivers were now also required to photographs the front door of an address where no one was at home. "The complaint that the carrier didn’t come is one of the biggest bugbears for consumers."

Gary Winter, sales and marketing director of carrier Hermes, revealed that over half the parcels handled by the company (200 million) were for retailers with no high-street presence. This figure was achieved through Hermes’ 9,500 couriers and 3,000 parcel shops (due to reach 5,500 by peak 2014).

Sunday deliveries were the latest feature introduced by the company, he reported. "A lot of companies charge a premium of £5 to £7 for this, but we’re offering it as a normal delivery option." He admitted that Sunday deliveries cost between a quarter and a third more than weekday deliveries, but added: "We’re working to flatten out the cost."

Winter said research suggested that carriers might have pushed responsibility for delivery too far back on to retailers. His solution was a "parcel manager" suite of resources for driving down costs, including emails triggered by each consumer touch point. "It costs £2 to answer a call," he pointed out.

He thought it was "absolutely vital" to offer an easy returns system. "So we plan to make this a one-click process using an app." A brand new web site for booking returns should help, he thought.

"Consumers are being assaulted by a wall of noise about home shopping," said Neil Ashworth, chief executive of CollectPlus. "Friends, retailers, search engines, social media web sites are all drowning them with information, and delivery providers have contributed to this."

He said that having been in retailing for thirty years, he found the present state of the market highly confusing, and made a call for simplicity.

According to CP Research, he said, 51 per cent of home shoppers were frustrated by waiting in for a delivery (which 79 per cent of them had done), and one in four people said they would not buy again from a retailer that caused this.

"Seventy-seven per cent of consumers are influenced by their delivery experience, and people will increasingly select retailer on the basis of delivery experience. The time has come to help those seventy-seven per cent."

Over-provision of delivery options was not the answer, he warned. "We found one retailer offering 17 delivery options." The solution was to remove the noise by simplifying delivery and making it reliable.

Julie Coxhill, business development manager for ByBox, acknowledged the rapid recent growth in click and collect, but pointed out: "Eventually the nation will run out of suitable outlets." This was one reason why the locker-bank solution remained a convincing alternative. "You can have lockers inside, outside or alongside stores."

ByBox had been involved in various recent projects, she reported, including one with Waitrose. "The lockers are simply considered part of the overall online shopping experience."

ByBox was also involved in various overseas locker projects, including one with Pitney Bowes, for which it was providing maintenance and service. Other projects were under way in Canada, Israel and France, where the company was working with La Poste. It also had 100 lockers with Belgian Post.

Tim Robinson, a route managing director at Network Rail, described the thought processes that had prompted his organisation to launch the Doddle home shopping drop-off system.

Looking at the project from Network Rail’s perspective, he said stations were being "dehumanised", adding: "So we’ve got space available for new products." Doddle offered a choice for both consumers and carriers, her said, underlining the fact that it was carrier-agnostic. "We’re not targeting just travellers," he emphasised, "but also the local community."

He claimed that 65 per cent of the UK population was within five miles of the top 250 railway stations. Pre-launch research suggested that 75 per cent of commuters felt a home shopping collection service would be useful, and 81 per cent said the same about returns. Many stations had free parking for up to 20 minutes, which would be ideal for this purpose, he commented.

Sixty-three per cent of respondents said they would use the service after work on weekdays, but only 13 per cent in the morning, while 54 per cent would use it on a Saturday morning. Home stations would be more popular than workplace stations.

The service would not include "loads of added-value services", Robinson said, but would offer consumer-to-consumer deliveries, and would sell packaging materials.

"We aim to have 75 stores in service by the 2014 peak."

Choice of delivery service for big-ticket items had lagged behind the rest of the e-commerce market, argued Steve Salt, sales and marketing director of Arrow XL, the two-man home delivery specialist that was previously part of Yodel.

"But we experienced double-digit growth last year," he said "and we’re looking at 17 per cent growth this year." He speculated that this was being driven by the housing boom, and would be stimulated by plasma TV sales ahead of this summer’s World Cup.

"Delivery choice prompts further growth," he added, "especially if the options include 24-hour and 48-hour delivery."

Drop shipping was a key element in this market, he said. "In our experience it accounts for 58 per cent of sales." But he added: "The retailer needs to offer a consistent experience, wherever the product is delivered from, and the challenge is managing this."

Logistics company wnDirect is unusual in having specialised in cross-border home deliveries to Russia (among other places), and the company’s Jonathan Matchett outlined the scale of the operation. It served 17 million square kilometres, he said, within which 80 million consumers would be internet-connected by the end of 2014. "The demand for brands is insatiable."

Recent difficulties of delivering to Russia had prompted many carriers to pull out of this market, he said, "but we’re still shipping." Currently the company was sending 1,500 parcels a week to Russia from the UK and the USA.

The company had taken special pains to deal with regulatory formalities, he said, for instance by allowing key data to uploaded prior to shipment. "Success is all about building a delivery promise.

"Consumers recognise the challenge of delivering across nine time zones, and accept a nine-day delivery time. We achieve 99 per cent delivery success."

SPSR was the company’s delivery partner in Russia, he said, delivering to 6,000 towns and cities, though the company did also use post for 2 per cent of zip codes.

Iyad Kamal of Aramex International gave a flavour of e-commerce development in a range of overseas markets, especially in the Middle East and Asia. The growth rate in Asia was 33 per cent, he said; the market value was $333 billion in 2012, and would probably amount to $298 billion in 2013.

He said India was currently the fastest-growing market, and would be worth £56 billion by 2023. Turkey’s market was also growing fast; in 2012 it was worth $7.3 billion, 75 per cent up on 2011.

In the MENA (Middle East and North Africa) region, 30 million people shopped online in 2012, Kamal said – 65 per cent more than in 2011. Seven countries accounted for $15 billion of value, and key among them were Saudi Arabia, Egypt, the UAE and Qatar.

Saudi Arabia alone accounted for 40 per cent of MENA e-commerce. In Qatar, he said, average income was $100,00 a year – double that of the US’s $51,000, while in Kuwait it was $40,000.

Different approaches to delivery were needed in these markets, he said – for instance, bulk shipping, local delivery and local returns. Up to 79 per cent of recipients expected to pay cash on delivery in 2013 (up from 70 per cent in 2012). This used to mean calling COD recipients in advance, though in recent months texting had been introduced, allowing the recipient to confirm their availability and address.


Mail & Express Delivery Conference: ‘Are you paying attention?’

Social media can be a powerful influence on public perceptions of the delivery world; and if unchecked, a small number of vociferous complainers can damage the reputation of entire companies.

The dual themes of acknowledging past failings and celebrating subsequent improvements were strongly in evidence in several presentations at this year’s Mail & Express Delivery conference, hosted as always by Triangle Management Services.

Dick Stead, who joined carrier Yodel as executive chairman late in 2013, described what he called "the transformation" that the company had been going through since then. He launched his presentation with an unashamed admission of the very poor image some customers had gained of the company.

"These complaints might only apply to 0.25 per cent of deliveries, but you ignore them at your peril." It was essential, he said, was to listen to customers. "Don’t make excuses."

The key was to monitor comments on social media web sites, he said, and work really hard to recover from mistakes." He said independent research by TrustPilot had seen an improvement in the company’s rating from 0.7 to 6.4.

He pointed out that some complainers had never actually had a delivery by Yodel, and some critical online comments were posted maliciously by fraudulent buyers in order to support their claims that delivery failures were to blame for supposedly lost goods.

Stead reported that there had been much discussion about what level of service Yodel could offer. "The choice is sometimes defined as either high-tech or what is often called cost-effective, but is usually poor." He said the company had elected to focus on something in between – a service that offered good value, but was still rigorous.

Andy Turner, sales and marketing director of City Link, agreed that it was essential to pay attention to social media. "Bad perceptions are directly influenced by critical comments," he said. "You have to be very careful of this."

He pointed out: "It’s consumers who are in control here, not our customers (the retailers)," adding: "Any aspect of poor service can be made available for public perusal very quickly."

His remedy was clear and unequivocal. "Avoid disappointment and frustration." He admitted it was difficult to get it right all the time. "But there’s a choice about how much control to allow consumers. If you offer a range of services, you have the best chance of getting it right."

TNT Post’s UK chief executive Nick Wells had a different issue of adverse publicity to address. There had been some negative reporting accompanying the roll-out of the company’s final-mile delivery service, he said, suggesting that a few of its "posties" had failed to deliver items in their care.

He said that in reality the company’s loss rate was only one in 35,000 items, which was better than the industry average. He accepted that bad publicity could create a negative image, but said the company was working hard to achieve exceptional standards.

Its objective, he said, was to achieve coverage of 45 per cent of UK addresses.

Mark Robinson, director of customer delivery for retailer John Lewis, reported massive growth in click and collect, which now accounted for a remarkable 60 per cent of the company’s online sales – "and we see this growth continuing, especially in categories such as fashion."

The group’s Waitrose stores, which gave it a wide-ranging high-street presence, represented the biggest single form of outlet for deliveries, he said, but CollectPlus also provided an important element.

Sixty per cent of demand in the company’s e-commerce operations was for next-day delivery, he said, taking account of both click and collect and home delivery. To provide a range of delivery services, the company used several carriers – notably City Link, DPD and Hermes.

However, two-man deliveries were handled in-house, Robinson said, and the company intended to continue to provide them in this way.

The company’s operations were tending towards using fewer, larger national distribution centres, along with consumer deliver hubs. The aspiration was eventually to a single view of stock for all parts of the business.

Consumers want free delivery, want it quickly, expect delivery choice, and are willing to experiment with new delivery options. These were among the themes of this year’s Delivery Conference, which continues to be one of the best attended and most lively of its kind. As always, it was hosted by delivery management specialist MetaPack.


Other stories in this issue


Top of page