Companies prioritizing customer satisfaction understand that providing immediate gratification is crucial to success in a highly competitive environment.
And who else to turn to for proof other than Amazon?
In 2005, Amazon launched an annual subscription service called Prime. The idea was to give Prime members free two-day shipping. Since then, Prime has become so successful that it transitioned to one-day and overnight deliveries and grew deliveries by 65% in 2023. The eCommerce giant has delivered over seven billion units to its Prime members. It has encouraged customers to buy more frequently and has increased Amazon’s conversion rates.
Amazon Prime has changed customers’ expectations. Today, customers have come to expect one-day delivery from other eCommerce companies. According to a McKinsey article, over 46% of respondents abandoned shopping carts because the shipping time was too long or not provided. 34% shopped in-store instead of online due to long delivery times.
This need for speed has led several eCommerce companies to follow suit. Research shows that over 80% of executives see one-day delivery as a way to generate more revenue.
But that’s not the only reason. Let’s find out why eCommerce companies are transitioning to one-day delivery, the challenges in implementing that, and finally, how to overcome those challenges.
Benefits Of One-Day Delivery
As we saw in the case of Amazon, one-day or same-day delivery was a game-changer for the eCommerce giant. Let’s find out how it can benefit other eCommerce companies too.
- Customer satisfaction
Online shopping was often slow, with delivery dates extending to days and weeks. The slow delivery discouraged many customers from shopping online, especially when they had to make last-minute purchases. They either shopped from other websites or physical stores.
One-day delivery has completely changed the landscape. It fulfills customers’ immediate needs, such as getting groceries, essentials, and impulse purchases delivered to the doorstep within a few hours for even unplanned events. This reliable delivery service and convenience create a positive customer experience and improve customer satisfaction.
- More sales opportunities
An eCommerce business thrives on customers’ instant gratification. Customers would not like to wait a week to get something as common as a phone charger or grocery products. If the delivery dates are not clearly mentioned, they might abandon the cart or hesitate to buy. They may even cancel the order or ask for a refund if the delivery takes longer than anticipated. Companies must capitalize on this to generate more sales and revenue.
One-day delivery will reduce the waiting time and eliminate the customer’s reluctance to buy the product. The quick delivery process can help eCommerce convert window shoppers into buyers and boost sales.
- Competitive advantage
One reason Amazon is unbeatable is its commitment to fast delivery. In a crowded eCommerce industry, customers will not hesitate to shop from a competitor if they deliver faster. Speed and convenience are what set an eCommerce company apart from its competitors. One-day delivery will ensure the customer gets what they want before they look at and compare the products on other websites. It will help the company consolidate its position as a brand that understands customer needs and delivers fast.
- Customer loyalty
One-day delivery assures customers that they can rely on the company whenever they need something on short notice. Don’t have all the ingredients to cook that special dish? Customers can order through a grocery app and receive it within a few hours. This promise of consistent and fast delivery will make the company indispensable and build customer trust. It will encourage them to make repeat purchases and deepen customer loyalty. Happy customers will also happily recommend the brand to their families and friends, leading to more sales and customers.
Challenges Of One-Day Delivery
Although one-day delivery can increase eCommerce companies’ profits and foster long-term customer relationships, the following bottlenecks could hinder its growth.
- Monolithic infrastructure
Traditional fulfillment centers were not designed for one-day delivery. For example, companies used large and complex automation solutions that could handle bulk orders and based their centers on the city’s outskirts or in regional hubs. This setup is fine for companies that don’t offer one-day delivery. It becomes a liability for companies following the one-day delivery model.
For one-day deliveries, companies must replace old automation technologies with ones that enable quick order fulfillment. This also calls for shifting to micro-fulfillment centers. Like Amazon, companies must open micro-fulfillment centers closer to customers’ locations and use compact and space-saving automation solutions that fit and maneuver in small spaces. This will help companies speed up picking, sorting, and shipping processes and ensure timely delivery.
- Legacy processes
In this era of instant gratification, the existing order fulfillment and delivery processes have become redundant. A company cannot fulfill orders on time if it doesn’t have visibility or control over the inventory or delivery. Companies have to source products quickly, package them, and ship them as soon as the customer places an order. This is possible only if companies revamp their legacy processes, optimize the supply chain, work more with local suppliers, and use technologies to accelerate order fulfillment and delivery.
- Logistical issues
One-day delivery requires meticulous coordination and planning. Sometimes, delivering in the same city becomes difficult, let alone shipping to another city, due to factors like fulfillment centers on the city outskirts or redundant technologies.
Companies will have to find the best possible routes to deliver products quickly. They also have to consider geographical factors. For example, companies cannot operate smoothly in a place with underdeveloped infrastructure. These issues have to be resolved before promising one-day delivery to customers.
How To Solve The One-Day Delivery Conundrum?
For companies wanting to become customer-centric, like Amazon, delivering within a day is imperative. However, the current infrastructure, processes, and automation solutions are designed for larger warehouses. They are not built for last-mile delivery or solve the throughput challenges emerging from the limited area of operation. Companies must work with industry experts to improve order fulfillment and increase throughput capabilities.
That’s where Carte+ can be helpful. Carte+ is an automation solution designed for micro-fulfillment centers of compact sizes. It can help companies with:
- Improving material movement in a constricted space
- Streamlining the picking and packaging of large-volume products and improving the pace of order fulfillment without compromising accuracy. It can help companies achieve a throughput of 450 totes per hour
- Reducing the installation time to six weeks and starting operations immediately
You can read more about Carte+ in this blog.
To know more about this reliable, on-demand order-fulfillment solution, contact us.