The pandemic forced sales to move online—uncovering the impact of delivery promises on purchasing decisions. Consumers want convenience and immediacy when ordering online. If businesses don’t find a way to meet expectations for fast delivery, they risk falling behind.
Key Takeaways
- U.S. eCommerce sales will account for 15.5% of total U.S. retail sales by the end of 2021.
- 62% of shoppers say delivery speeds influence their purchasing decisions.
- 30% of consumers expect same-day delivery.
- 85% of online shoppers search elsewhere when delivery speeds are too long.
- 58% of shoppers buy more from Amazon as a result of their same-day service.
2020 trained consumers to expect options. Options for how and when they receive their products. And the faster, the better. Here are three reasons why retailers and brands must adopt same-day delivery:
1. Rise in eCommerce retail #
In 2020, people spent $861.12 billion online, which accounted for 21.3% of total U.S. retail sales—an unprecedented increase of 44% YoY. With physical stores now reopened, 2021 won’t see that same share of eCommerce sales. But that doesn’t mean that things are going back to normal.
Think back to Q4 of 2019. Online retail accounted for just 10.9% of all U.S. commerce. Then, analysts predicted that in 2021, eCommerce would account for 13.2% of total U.S. retail. Now, they predict that it will account for 15.5%. That’s a 30% increase from the previous prediction—the biggest increase in eCommerce we’ve seen since Q2 of 2020.
Analysts predicted that in 2021, eCommerce would account for 13.2% of total U.S. retail. Now, they predict that it will account for 15.5%.
Consumers attest to that growth. Consider this:
58% of consumers shop online at least once a week.
43% of consumers say they would be fine if they never shopped in a physical store again.
73% of consumers believe the majority of shopping will happen online in the future.
The growth in eCommerce creates a crowded retail space. So what makes retailers stand out among the online competition?
Speed.
Sixty-two percent of shoppers say delivery speeds influence their purchasing decisions. They expect to receive their purchases in a matter of days. As it stands, 90% of consumers see 2- to 3-day shipping as the baseline delivery promise. Anything slower fails to meet consumer expectations. And, for almost a third of consumers (30%), same-day delivery is the expectation.
90% of consumers see 2- to 3-day shipping as the baseline delivery promise.
2. The hunt for faster delivery options #
When a delivery promise misses the mark, there’s a significant impact. Eighty-five percent of consumers search elsewhere for better options when delivery speeds are too slow. And one of the top two reasons for shopping cart abandonment is that delivery speeds weren’t fast enough.
Conversely, fast shipping leads to higher conversion rates. Sixty-eight percent of consumers say fast shipping leads them to place an online order. This means that an extra day of delivery time can make or break a purchase.
85% of consumers search elsewhere for better options when delivery speeds are too slow.
3. Pressure from Amazon #
Amazon conditioned consumers to expect faster delivery promises for online orders, and they continue to invest in customer obsession. Case in point: the company’s 2020 announcement about adding more than 1,500 same-day fulfillment centers. Amazon Prime’s Same-Day Delivery gets customers their products in as fast as five hours. No other retailers can match the investment Amazon makes every year to improve its delivery promises. Not only does it have the largest, closed logistics network, it also loses billions of dollars everywhere to support fast, last-mile delivery. It’s a model that’s impossible to duplicate. But it’s a model that millions of consumers value.
Consumers are willing to spend more to qualify for a faster, more affordable delivery promise. Fifty-eight percent of Amazon Prime Same-Day users say the offering increases how much they spend on the platform. And, overall, 48% of consumers say they will pay more for an item if it comes with faster shipping. That’s a compelling case for other retailers and brands to uplevel their logistics network to support same-day delivery.
58% of Amazon Prime Same-Day users say the offering increases how much they spend on the platform.
Optimizing for same-day delivery without investing billions of dollars #
If retailers and brands want to stay relevant in an Amazon-first world, they must find an omnichannel fulfillment strategy that enables them to offer same-day delivery—affordably. Businesses must expand their logistics networks to bring goods closer to their customers and optimize for the last mile. The solution? Add a flexible logistics network to existing, fixed infrastructure.
Flexible logistics enables retailers and brands to expand and contract their logistics network to meet ever-changing market demands. This strategy provides an affordable solution to network expansion. By reducing last-mile transportation times and costs, it’s more feasible to offer faster delivery.
Businesses must seriously consider how they will live up to today’s consumer demands—how they’ll stand out in a crowd. Because same-day delivery is no longer just a nice-to-have. It’s a must-have.
