Online shopping is booming resulting in fierce competition to get goods out quickly and cheaply, according to new research from leading location data and technology platform HERE Technologies. This could spell trouble for retailers as logistical challenges loom, with new data revealing increased congestion around Melbourne’s port.
According to a map developed by HERE Technologies that displays the time spent in port by container ships and the level of truck traffic congestion affecting ports in 2021, by leveraging its real-time and historical truck traffic data, the West Gate Tunnel and Freeway in Melbourne were bearing the brunt, while roads around Melbourne’s port were 4.3% more congested in November 2021 than average. Container ships were also spending close to two days at the port – more than twice the global median (0.69 days) in 2019.
The research from HERE Technologies saw 1,200 Australians and Kiwis surveyed, revealing that reliance on online shopping has grown in the second year of the pandemic – 44% of Aussies stated they have become more reliant on e-commerce this year compared to 37% saying the same in May 2019.
The good news is around three in four Australians (73%) said they have been satisfied with their delivery experiences over the past year. Meanwhile, 81% said their delivery experience impacts future shopping choices, with just 6% saying they would go back to a retailer despite having a poor delivery experience.
“We’re looking at an increasingly competitive retail space as e-commerce is now a go-to for most people, as opposed to just filling a pandemic-induced gap. Pressure on last-mile delivery is increasing as supply chains try to meet the cost and time expectation of consumers,” said Daniel Antonello, Director and Head of Business for Oceania at HERE Technologies. “This is where location intelligence tools such as post-trip analysis and last-mile delivery route planning applications can help alleviate supply chain pressures and give consumers their ideal delivery experiences.”
In terms of what keeps consumers happy with their e-commerce delivery experience, affordable or free delivery costs topped the list, followed by logistical concerns such as the ability to select specific delivery time slots and be prompted by regular delivery updates.
Delivery timeframes of one to two and three to five days were seen as the most acceptable, with just 9% of respondents saying they would be happy to wait five to 12 business days. Over half of Australians surveyed expect to pay nothing for one to two days of delivery, and over two-thirds expect three to five days of delivery to be cost-free.
The research also revealed that 73% of respondents said they will continue shopping online. However, there are some positive news for brick-and-mortar stores as a third of respondents have indicated that they do not intend to keep shopping online to the same extent beyond the pandemic.
Adam Etherington, Principal Analyst, Digital Enterprise Services at Omdia said, “The COVID-19 pandemic has permanently changed consumers omnichannel demands. Innovative use of edge compute, hybrid cloud, artificial intelligence, 5G, API’s, IoT and Enterprise Resource Planning (ERP) or Supply Chain Management (SCM) capabilities can deliver operational agility, scale, and cost-efficiency for businesses. As such, technology-driven enhancements will determine the winners and losers in the Australian supply chain sector as the economy rebounds.”