SAME DAY DELIVERY - michaelhu.com€¦ · How does Same Day delivery fit within the retailer’s...
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SAME DAY DELIVERY Strategic Bets, Emerging Solutions, Path Forward
Transcript of SAME DAY DELIVERY - michaelhu.com€¦ · How does Same Day delivery fit within the retailer’s...
SAME DAY DELIVERYStrategic Bets, Emerging Solutions, Path
Forward
What is Last mile?
Retailer DC
Manufacturer DC
Retailer Store
Converted / Dark Store
Home or Office
Lockers
Store for Pickup
Movement of goods from the last inventory point to the point of consumer chosen access
U.S. last mile delivery is $27B and growing
Last Mile Rapidly Growing
•2% of online orders
•$0.6B market
•Significant CAGR in urban
2014 2015 2016 2017 2018
US Same Day Forecast in 20 Cities
Same Day Emerging
$27B market
10% CAGR
Same day seen as a strategic “bet” today
Argument For …
Argument Against …
60% of Millennials expect Same Day
52% consumers willing to pay for Same Day
Supply side innovation show consumers what is possible (Amazon effect)
Modest 9% of shoppers said Same Day will lead them to buy more online
Will not scale beyond dense urban centers
Majority of consumers still want low delivery cost over speed
Role of Same Day in omnichannel?
Are consumers ready? Which segments and occasions?
How does Same Day delivery fit within the retailer’s broader omnichannelstrategy?
How important is Same Day delivery in driving omnichannel growth and retailer differentiation?
Several Same Day models emerging
Retailer Managed
3PL Managed(Owned)
3PL Managed (Crowdsource)
Marketplace (Crowdsource)
Marketplace (Outsourced)
Each type has its own structural pros and cons in terms of…
Cost Adoption Scale Flexibility Control Innovation
Source: A.T. Kearney
Emerging solutions
Which geographic and category segments are you in today? Where do you plan to be in 3 years?
Please describe your Same Day offering? How is it different than other solutions?
What aspect of your solution do customers love today? How does your platform enable innovation beyond speed?
Provider View
Google and Instacart are marketplace based … what are the demand and supply side drivers for scaling in a region?
Privileged & ConfidentialGoogle Express
The Stores you Love
Delivered Fast
Google Express
48 Merchants
Platform for merchants
Google Express
Same Day + Overnight Delivery
overnight
Google Express
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Infrastructure Free Grocery e-Commerce
Consumers Grocery StoresRetailer Marketplace
Double Digit M-o-M
Growth
1 Hour/Same-day
Delivery & Pick-up
18 Major
US Metros and Growing
100+ Retailer Partners $275MM+ in Funding
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18 Markets and Growing
Seattle
San Francisco
Bay Area
Los Angeles
Chicago
Austin
BostonNew York
Philadelphia
Washington, D.C.
Current City
www.instacart.com/locations
Denver
Atlanta
San Jose
Portland
Houston
Boulder
Miami
Indianapolis
Minneapolis
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Industry defining offering driving a differentiated customer
experience
Rich, digital customer
experience
Instacart receives high praise from its customers for its clean, easy-to-use interfaces that instantly sync across
customers’ devices
Ability to engage with
customers
Visual and UPC/PLU based confirmation of desired items
Active Substitution Management
Engage proactively while in the store –text, email, phone
Monitor performance and make it right – no matter what! 24 hour customer service
Sophisticated fulfillment algorithms to ensure
timeliness, flexibility and efficiency
Intelligent in-store technologies to ensure
efficient picking/packing/ check-out
Cutting edge technology enabling
unmatched service
Adoption considerations
What are you looking for in a scalable solution? What do you need to see in terms of (performance, referencing, strategic
considerations)?
Are you piloting Same Day solutions today? What are the trigger points for scaling a Same Day program?
What are the broader omni-channel supply chain enablers and challenges in driving Same Day?
Retailer View
Path forward
Tell the audience something we don’t know about Same Day
How and what technology will materially enable Same Day delivery in the next 3-5 years?
Where will Same Day be 3-5 years from now?
Thank you – please continue the dialog!
Michael Hu – Principal, A.T. Kearney | [email protected]
Marie Robinson – COO Michael Kors | [email protected]
Raj Kumar – Partner, A.T. Kearney | [email protected]
Brian Elliott – GM Google Shopping | [email protected]
Vishwa Chandra – VP Retail Accounts, Instacart | [email protected]
Dwight Herlong – VP Supply Chain iCracked Inc. | [email protected]
