There is a nagging tension when it comes to home delivery and the environment. Consumers love the convenience of home delivery but are very concerned about its effect on the planet. This was clear in the recent pan-European home delivery consumer sentiment study Descartes commissioned where 71% of the respondents stated that they think twice about ordering online over worries about the environmental impact. While many retailers are enjoying their online prosperity, they should be cognisant that their customers will be watching to see how they innovate to help protect the environment. This is especially true for retailers targeting younger audiences, as environmental concerns escalated as the age of the consumer got younger with a high of 86% for the 18 – 24 years’ group. Considering this should be a priority for retailers as they head into 2022.
Rather than viewing environmental concern as another expectation from consumers, retailers should look at it as an opportunity to not only delight customers, but improve their productivity and bottom line. There are a number of ways to make home delivery more environmentally friendly and many of them result in more efficient home delivery.
Every consumer has a home delivery persona. For example, some consumers want it as fast as possible, others cheapest and others in the most environmentally friendly way. In the survey, Descartes asked consumers how interested they are in delivery related services and the top three had positive environmental implications. By consolidating orders across a week for a customer and using drop box facilities, retailers can limit the number of deliveries to the customer, which reduces delivery resources and distance needed to serve them. This has a positive effect on environmental impact and the retailer’s operational costs.
Top Delivery Services Choices
Another home delivery approach is “eco delivery” time windows. Eco delivery time windows are delivery options that are adjacent to existing delivery appointments and so require less distance and fuel to execute. Less fuel means less carbon dioxide in the air and hence this approach is more environmentally friendly. Because of the shorter distance required to make the delivery—typically by ~20% versus regular deliveries – eco deliveries are the most carbon and cost-effective. Eco deliveries are a win/win choice for customers and retailers.
The environmentally friendly home delivery choices are the result of two strategies that are different to how most retailers operate. First, retailers must move from mode-centric to order-centric delivery planning. This approach not only looks at the orders for an individual customer but across the entire customer base. Second, delivery options need to be dynamically presented to the customer as they are buying to educate them on their value to the environment. The combination of the two allows customers to “opt-in” for environmentally conscious deliveries and, most likely, reduce the cost of home delivery for the retailer.
Lastly, consumers want retailers to report on their progress in their efforts to reduce environmental impact. Logistics improvement programmes should be considered in this reporting because they are an excellent source of environmental performance improvement. Therefore, every logistics efficiency programme should not only be viewed by the reduction in distance, vehicles, fuel, and maintenance costs but also from their contribution to a better environment.
Providing the consumer with eco-friendly delivery choices and making home delivery logistics more efficient benefits both the consumer and the retailer. Rather than treating environmental concerns as another consumer demand, retailers should use them to help attract more customers and improve their bottom lines.