Patrick Wall opened the 10th TDC Global (The Delivery Conference) and immediately kicked off talking about the pace of change in ecommerce.
In the UK there was a general reduction in growth in the UK – the good news is that there is still growth but Peak didn’t grow exponentially as in the past. This still leaves carriers with massive volumes at this time of year and the issue this year wasn’t so much on the delivery as on the management of data – timing of tracking information and the quality of API connections to get the information flowing from retailer to carrier to consumer.
Brexit has left us in an incredibly ambiguous position said Patrick, sales are about 10% off as consumers are already curtailing their cross border purchases. VAT will be payable on all cross border sales and customer forms will need to be completed if Brexit goes ahead without a deal in place.
Trends in ecommerce
Brands and marketplaces will dominate as they provide consistency and deploy new technology. For carriers it’s very interesting as many relationships were forged at a national level but increasingly it will be at an international level as Brands implement global strategies – making it harder to clinch deals with the largest carriers winning.
The consumer’s experience will determine success, with a focus on success in store. More investment in stores will be needed as unless stores can provide a compulsive experience then it has to be questioned as to what their proposition is.
Because ecommerce is the fundamental within retail, the costs within ecommerce become more important – who are the most valuable customers and what is their lifetime value comes to the key as the cost to serve retail customers will be questions asked. This will flow down to carriers as currently there’s flat costs for both rural and high density routes which are a lower cost to serve, and Patrick believes that differentiated pricing will come into play. This will inevitably lead to the question as to whether consumers in outlying areas should pay surcharges for their deliveries or if retailers will have to bear the brunt of regional charging?
