If you live in Centerville, Ohio, your small grocery order from Kroger Co. might fly to you—or rather to your cell phone—via an autonomous drone helicopter. In Houston, an electric delivery bot might drive to your house to deliver your next order from Domino’s Pizza.
Those are just two examples of companies testing robotic delivery of online orders. The market for delivery bots—which come in many shapes and sizes—is small but growing quickly.
Chick-fil-A recently signed up to test Kiwibot, a smiling, winking, sidewalk-using drone, in Santa Monica, California.
According to data from market research firm Grand View Research Inc., the global autonomous last-mile delivery market was valued at $11.9 million in 2020, up 11.2% from $10.7 million in 2019. The firm expects the market to grow at a compound annual growth rate of 32.4%, reaching $84.9 million by 2027.
Grand View says North America accounted for 62.5% of the autonomous last-mile delivery market in 2019. “The rising ecommerce sector has escalated the demand for quick delivery of packages, which has supplemented the growth of the autonomous last-mile delivery market,” the firm says.
Among retail chains, grocers and mass merchants are the earliest adopters of automated delivery. Coffee shops and quick-service restaurants—including the fast-food chain Chick-fil-A Inc.—are testing bots as well. Chick-fil-A recently signed up to test a smiling, winking, sidewalk-using drone called Kiwibot in Santa Monica, California.
Currently, most robotic delivery—either on wheels or in the air—is sold to retailers as a service akin to the way companies like Instacart and DoorDash offer their services. But it’s conceivable that larger retailers could eventually decide to buy and maintain their own robot fleets, says Sam Abuelsamid, principal analyst for e-mobility at market research firm Guidehouse Insights.
To get immediate access to the rest of this article, sign up for a free Strategy Membership using the Join for Free button below. If you’re already a member, please sign in.