Autonomous Delivery Adoption on the Rise During the Pandemic
From medical supplies to groceries to household goods, the current COVID-19 pandemic has put an incredible strain on global supply chains. With massive spikes in product and significantly impacted means of delivery, the demand for technology to produce a solution has increased exponentially. Unmanned delivery vehicles, autonomous vehicles, and driverless deliveries have begun to assist in addressing these supply chain issues as well as helping to reduce the overall risk of spreading the virus.
As technology improves and costs fall, the necessity of autonomous delivery during the pandemic is growing. The implications of the COVID-19 pandemic are making the concept of drones and delivery robots more appealing by the day. While no one is entirely certain just what the new normal of the world will be, social distancing and online shopping are likely to be a large part of it.
This will mean fewer people in stores, increased online ordering, and contactless fulfillment will increase the viability of delivery robots. While driverless delivery may seem like a solution to a temporary issue, it is more than likely that the long-term behavioral changes in consumers brought about by the pandemic could in fact lead to autonomous delivery becoming a permanent part of the retail world.
How Contactless Delivery is Expected to Grow
Customers are now wary of shopping in-store at physical locations due to the potential health risks and only go out for essential items. For businesses that operate either entirely or mostly as a physical brick-and-mortar location, this is an increasingly damaging prospect, unless they are willing and able to adapt quickly.
With many brick and mortar stores having to close their doors, e-commerce order volume has increased by 50% compared to 2019. However, this recent surge, combined with already disrupted supply chains, has led to an increase in shipping delays and order issues. Retailers are taking, on average, 1.5 days longer to fulfill orders.
All this means that while people may be placing more orders than ever before, the physical act of actually delivering them to customers is more difficult. One solution is contactless delivery. This means that your products will be delivered to you with as minimal physical contact as possible. People no longer need to physically sign for something and products are being left in safe places as opposed to being directly handed over to someone. This limited physical contact is attempting to reduce the potential spread of the virus through any means necessary, while still ensuring that people and businesses are able to buy and sell effectively.
The autonomous nature is also extending towards payments as well as delivery. The global health crisis of COVID-19 has forced institutions to rethink every aspect of their business, from incorporating driverless delivery, creating curbside pickup capabilities and even the increased inclusion of contactless payment methods. The pandemic has only accelerated the move towards NFC based payments and autonomous delivery as an expected part of the shopping experience. We’re seeing these elements of the e-commerce world truly becoming a part of the industry’s new normal.
Contactless payment systems are nothing new, but now this process can be applied to payments with a smartphone, smartwatch, or even your voice when using a smart speaker which allows a person to entirely digitize their wallet. When combined with autonomous delivery, the customer experience is enhanced due to the seamless nature of transactions and the lack of work required on the part of the consumer. Anything can now be paid for and delivered without the customer having to really do anything. During a global crisis such as the current pandemic where public health is now prioritized, these methods mean that people can continue to buy and receive goods in an entirely safe manner, without having to risk their health, or the health of those around them.
Consumer Behavior Shifting Towards Buying Online
While the pandemic has left a devastating impact on the world, it has also altered the way retailers do business for good. As a result of social distancing and localized quarantines, many more people have gravitated towards online shopping for a growing number of product categories. The rapid rise in online purchases, in combination with the very nature of new customer demands will likely shape the future of e-commerce as a whole.
According to recent statistics, e-commerce sales rose dramatically by 49% in April, compared to figures in early March, while online grocery sales helped to drive this increase with a 110% boost in daily sales. With the majority of physical locations closed or altered in some way, the only alternative to acquire these goods was through an e-commerce or an online platform. However, this wasn’t just limited to food products and essential items, sales of electronic devices also skyrocketed by 58% while the number of books being sold has doubled as people were looking for ways to pass the time during the lockdown.
There have also been record-breaking months for PayPal in terms of both enrollment and use. The company saw the addition of 7.4 million new active accounts while the daily net new customer rate averaged roughly 250,000 per day. As more people begin to get more familiar and comfortable with PayPal, as well as online shopping in general, these enlarged figures are only set to become part of a wider, global trend. The company is expecting to add a further 15 million to 20 million new active accounts in Q2 alone.
As mentioned, the majority of people are trying to minimize their exposure to the outside world through online shopping and e-commerce. Everything from groceries and household goods to medicine and hygiene products are now shifting to online purchases and contactless delivery. Those who were once averse to the concept of online shopping have now been forced to adopt it. The figures mentioned earlier illustrate that companies and customers alike are beginning to become more comfortable with the concept of online shopping, therefore e-commerce, alongside forms of contactless and driverless deliveries are expected to become a much more common occurrence.
The use of autonomous vehicles and delivery robots, while currently becoming more available, is not an entirely new concept. Many businesses have been attempting to incorporate some form of contactless delivery into their wider supply chains for several years, and have been setting the tone for how advancements are likely to happen. These include:
Walmart - Walmart has partnered with Nuro to launch autonomous delivery robots in Houston. Autonomous delivery robots have been utilized to deliver orders to select Walmart customers who opted into the program early in the year, with plans to expand to more customers throughout the year. These autonomous vehicles are able to transport goods directly to the person who ordered them without a Walmart employee needing to be there to help.
Kroger - Kroger, also partnered with Nuro and has begun launching their own autonomous grocery delivery robot. Previously these autonomous delivery robots were tested in Scottsdale, Arizona completing thousands of deliveries. Orders can be placed via the Kroger app and delivery times can be scheduled with no minimum order amount required from the customer.
CVS - Beyond just groceries, CVS has begun to autonomously deliver healthcare products to customers. Prescription orders placed via CVS’ website or pharmacy app can choose the autonomous delivery option, as well as adding other non-prescription items too. Once the autonomous vehicle arrives, customers will need to confirm their identification to unlock their delivery which will be free of charge for CVS Pharmacy customers.
Contactless-Fulfillment and Drone Deliveries
As well as driverless delivery and autonomous vehicles, drones have been seen as the next logical step in delivery practices for many years now. Drones can be effective for a number of different reasons and can help businesses function in multiple sectors. This can include everything from delivering parcels and advertising campaigns to site surveying and accessing rural or difficult areas.
Large companies such as Amazon, Walmart, UPS, Google, and other global postal companies have been investing significantly in drone delivery projects in recent years as a way to strengthen their customer service capabilities and it is incredibly likely that this will become a reality, sooner rather than later.
Drones are currently being used to deliver much needed medical supplies such as coronavirus test kits and personal protective equipment to rural parts of the UK, and if successful will likely lead to a much wider implementation into other parts of the country. While there are still some technological issues that need to be solved before they can become common practice, it won’t be too long before drones are delivering parcels of all kinds to customers, especially for those who live off the beaten track.
As the need for services such as driverless delivery and delivery robots grows due to the COVID-19 outbreak, companies are trying to utilize, implement, and refine just how this technology can operate in an everyday world. While there are some challenges that still remain, the adoption of autonomous and contactless delivery is on the rise as a result of the ongoing pandemic.