Because of the coronavirus pandemic, retail chain Walgreens Boots Alliance Inc. went from piloting same-day delivery with on-demand shipping platform Postmates to a nationwide rollout of the program while also adding same-day shipping with platforms DoorDash and Instacart, all within a few months.
“When the pandemic struck in March 2020, we knew that convenience and ways to shop from home were going to be more important now than ever before,” says Stefanie Kruse, vice president, digital commerce and omnichannel, for Walgreens.
“Overall customer response to these services has exceeded expectations,” Kruse adds about its same-day delivery services.
Because of the pandemic, more consumers went online to shop as stores were closed or at reduced capacity, and shoppers wanted to avoid indoor spaces. This unexpected boom in online orders meant shipping carriers were not prepared for the influx of package deliveries they had to make. In April 2020, for example, ecommerce package volume increased nearly 60% year over year, according to data from last–mile technology vendor Convey Inc., which has 130 retail clients. And many consumers were shocked to find retailers’ estimated delivery dates for nonessential goods were weeks or months in the future, even for Amazon.com orders.
With shipping carriers maxed out, merchants turned to same-day shipping apps to meet shopper demand for speedy shipping, such as Roadie, Shipt, Instacart, DoorDash and Uber Technologies Inc. (which in December closed its acquisition of delivery service Postmates). Many of these platforms initially served a niche category, such as grocery or restaurants, but have since expanded to retail.
Most of these platforms allow a merchant to showcase a selection of their inventory within their own apps. For example, a consumer on Instacart can browse Best Buy Co Inc. products to purchase and have delivered that day. When a shopper makes a purchase in the app, a gig economy worker is sent to that merchant’s store to pickup the order—which is either already picked and waiting, or the gig economy worker has to shop the store himself—and then delivery the item. Retailers can also integrate these same-day shipping platforms onto their own websites. For example, on the retailer’s checkout page, the shopper could select “same-day delivery fulfilled by…” and the gig economy worker from whichever platform is then tapped to fulfill that order.
Retail chains, including Best Buy, Walgreens, Dick’s Sporting Goods, Tractor Supply Co., GNC Holdings Inc., Petco Animal Suppliers Inc., Sephora USA Inc., Staples Inc. and Bed Bath & Beyond Inc., have all leveraged their store footprints to launch same-day delivery by tapping into on-demand delivery platforms. Here’s a look at the growing consumer demand for same-day delivery and the ways merchants are meeting it.
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