Home >Industry >Retail >Customers warm up to paying for express deliveries during pandemic: Redseer

BENGALURU: As consumption shifts online amid the coronavirus pandemic, customers are warming up to paying extra for express or same day deliveries, according to findings by management consultancy RedSeer and logistics player Shadowfax.

According to the ‘Delivery Delight Index’, RedSeer and Shadowfax said customers are willing to pay an average fee of up to 44 for express e-commerce deliveries for essential categories including pharmacy and groceries.

“There is an opportunity for e-pharma platforms to monetise by offering express deliveries to customers which in turn will further lead to higher customer satisfaction," said the report.

Demand for express deliveries for categories including groceries are higher in non-metros.

Also, digitally native brands (DNB) including Mi, Mamaearth, Bewakoof, and BOAT, which have largely retailed on e-commerce platforms have improved their direct delivery experience during January-March this year.

The improvement in delivery speed for these digitally native brands is a result of them partnering with third-party warehousing aggregators, which has allowed them to start same or next day deliveries.

According to RedSeer, the Index was developed after undertaking 10,000 consumer surveys covering 38 players across categories of e-tailing marketplaces, hyperlocal marketplaces, digitally native brands and traditional brands which have started online deliveries.

“Currently 40% of the overall e-commerce deliveries are powered by third-party logistics (3PL) partners. A major reason for 3PL’s growth is ‘express deliveries’, which brands are looking to provide to improve customer satisfaction. However, we also see major growth for 3PL as retail and traditional brands directly sell to customers through their online platforms. New sectors such as direct-to-consumer (D2C) and social commerce are also expected to push the growth of 3PL further," said Abhishek Bansal, co-founder of Shadowfax, to Mint.

According to the survey, e-commerce marketplace including Amazon, Nykaa, Myntra continued to rate high in terms of delivery experience compared to competitors during the first quarter of 2021. In the hyperlocal space, Swiggy and Dunzo revived positive feedback for their delivery experience. For traditional brands, Lifestyle scored high in customer satisfaction for online deliveries.

“E-tailers at present are investing heavily in setting up logistics infrastructure, as they look to offer same day deliveries to their customers. In this regard, they are setting up micro-warehouses closer to delivery points, to ensure higher customer satisfaction," said Saurav Chachan, engagement manager at RedSeer.

Excluding large horizontal players which own their own logistics, there is high reliance on third-party logistics, at present, RedSeer said.

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