E-commerce Growth: Opportunities and
Challenges for the Logistics Industry
Agenda

1.

Gauging the global e-commerce opportunity

2.

The impact of delivery choices on e-shopper buying behaviour

3...
Global e-commerce market size

Source:eMarketer
NZPO EMS Service

DHL | Page

3
Global e-commerce market size

 With the globalization and internationalization of companies,
cross border online shoppin...
Global e-commerce market size
Australia is one of the world’s six key shopping destinations for cross-border
shopping, acc...
Agenda

1.

Gauging the global e-commerce opportunity

2.

The impact of delivery choices on e-shopper buying behaviour

3...
Consumer delivery expectations

NZPO EMS Service

DHL | Page

7
Consumer delivery expectations

•

E-commerce and Delivery - A study conducted by Copenhagen
Economics between 10th and 30...
Consumer delivery expectations

Important features for shopping from same web
shop again
Next day delivery
Track n'Trace s...
Consumer delivery expectations
Importance of point of delivery for e-shoppers
Delivery to parcel kiosk (automated locker)
...
Consumer delivery expectations
Importance of price options for e-shoppers
Faster but more expensive than standard delivery...
Consumer delivery expectations

Importance of value added feaures for e-shoppers
Extra service at delivery, e.g. installat...
Consumer delivery expectations

Importance of return options for e-shoppers
Return product immediately at the moment of
de...
The impact of delivery on shopping cart abandonment

Source: Copenhagen Economics, E-shopper survey

NZPO EMS Service

DHL...
Consumer satisfaction

Share of e-shoppers dissatisfied with delivery aspects
40%

35%
30%
25%
20%

18%

15%

10%
5%

Comp...
Agenda

1.

Gauging the global e-commerce opportunity

2.

The impact of delivery choices on e-shopper buying behaviour

3...
Challenges
•

E-shoppers have an almost infinite choice in terms of what they can buy,
where they can buy it, and when the...
The e-commerce delivery value chain

E-shoppers: Buy products and
delivery services from e-retailers;

Delivery operators:...
Problems that might occur along the value chain
Step in value chain

Example of problem

1. Order placed

Inadequate infor...
The impact of e-commerce growth on the logistics industry

Source: IPC

NZPO EMS Service

DHL | Page 20
The impact of e-commerce growth on the logistics industry

 The need for information (tracking, e-mail notifications etc....
Agenda

1.

Gauging the global e-commerce opportunity

2.

The impact of delivery choices on e-shopper buying behaviour

3...
Where to from here?

The aspects of delivery found to cause the greatest dissatisfaction to the
consumers were:
 Complain...
Where to from here?

The research by Copenhagen Economics reveals that the most important
aspects of delivery for e-shoppe...
Q&A Time

NZPO EMS Service

DHL | Page
Thank you!

Aldo D’Agostino
Head of Sales, DHL Global Mail
Mobile +61 413 885 116
aldo.dagostino@dhl.com

To download the ...
DELIVERING SUCCESS. WORLDWIDE.
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Aldo D'Agostino,DHL Global Mail - E-Commerce growth: opportunities & challenges for the logistics industry

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Aldo D’Agostino, Head of Sales, Oceania, DHL Global Mail presented this at Online Retail Logistics 2013. The conference focused on ways to create efficient supply chains to support the increase in online shopping.

For more information, visit http://www.informa.com.au/onlineretaillogistics13

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Aldo D'Agostino,DHL Global Mail - E-Commerce growth: opportunities & challenges for the logistics industry

  1. 1. E-commerce Growth: Opportunities and Challenges for the Logistics Industry
  2. 2. Agenda 1. Gauging the global e-commerce opportunity 2. The impact of delivery choices on e-shopper buying behaviour 3. Challenges for the Logistics Industry 4. Where to from here? NZPO EMS Service DHL | Page
  3. 3. Global e-commerce market size Source:eMarketer NZPO EMS Service DHL | Page 3
  4. 4. Global e-commerce market size  With the globalization and internationalization of companies, cross border online shopping is growing significantly.  Global cross-border online shopping will be worth $105 billion this year, with 94 million consumers regularly buying from overseas websites.  By 2018, it is expected to grow nearly 200% to $307 billion, with 130 million cross-border online shoppers. Source: Paypal Report, Modern Spice Routes: The Cultural Impact and Economic Opportunity of Cross-Border Shopping, July 2013 NZPO EMS Service DHL | Page 4
  5. 5. Global e-commerce market size Australia is one of the world’s six key shopping destinations for cross-border shopping, accounting for 16% of international online sales. Source: Paypal Report, Modern Spice Routes: The Cultural Impact and Economic Opportunity of Cross-Border Shopping, July 2013 NZPO EMS Service DHL | Page 5
  6. 6. Agenda 1. Gauging the global e-commerce opportunity 2. The impact of delivery choices on e-shopper buying behaviour 3. Challenges for the Logistics Industry 4. Where to from here? NZPO EMS Service DHL | Page
  7. 7. Consumer delivery expectations NZPO EMS Service DHL | Page 7
  8. 8. Consumer delivery expectations • E-commerce and Delivery - A study conducted by Copenhagen Economics between 10th and 30th January 2013 with 3,077 e-shoppers, 70 e-retailers , 61 delivery companies and 26 national postal regulators in EU. • This study analyses how delivery of products bought online can be improved to increase the amount of domestic and cross-border ecommerce in Europe. Improving delivery services is an important driver to enhance e-commerce*. *This presentation focuses only on the e-shopper perspective NZPO EMS Service DHL | Page 8
  9. 9. Consumer delivery expectations Important features for shopping from same web shop again Next day delivery Track n'Trace shipments Electronic delivery notification (e-mail or SMS) Accurate delivery date (delivery on pre-defined day) Delivery within 2-4 days Flexible and convenient delivery Free delivery Convenient return options Low delivery prices 0% 20% 40% 60% 80% 100% Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 9
  10. 10. Consumer delivery expectations Importance of point of delivery for e-shoppers Delivery to parcel kiosk (automated locker) Delivery to work adress Delivery to relay point or parceol kiosk specified by you Delivery to relay point (shop) Delivery to neighbor in case that one is home at the delivery time Having ability to redirect the parcel to a different point Delivery to the post office Delivery to the home address 0% 20% 40% 60% 80% 100% Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 10
  11. 11. Consumer delivery expectations Importance of price options for e-shoppers Faster but more expensive than standard delivery More convenient but more expensive delivery than standard delivery Standard delivery Free delivery 0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100% Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 11
  12. 12. Consumer delivery expectations Importance of value added feaures for e-shoppers Extra service at delivery, e.g. installation of product bought Cash on delivery Insurance related to delivery Track n'Trace Electronic delivery notification (e-mail or SMS) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100% Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 12
  13. 13. Consumer delivery expectations Importance of return options for e-shoppers Return product immediately at the moment of delivery Take the return parcel back to a physical store(same as webshop) Organize a specific picuk up with the delivery operator Track n' trace of return parcel Take return parcel to a post office/ collection point 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 13
  14. 14. The impact of delivery on shopping cart abandonment Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 14
  15. 15. Consumer satisfaction Share of e-shoppers dissatisfied with delivery aspects 40% 35% 30% 25% 20% 18% 15% 10% 5% Complaints Returns Information about delivery and returns Delivery price Value added features Speed of delivery Point of delivery Time of delivery 0% Note: Horizontal line shows the average level of dissatisfaction (18 per cent). Source: Copenhagen Economics, E-shopper survey NZPO EMS Service DHL | Page 15
  16. 16. Agenda 1. Gauging the global e-commerce opportunity 2. The impact of delivery choices on e-shopper buying behaviour 3. Challenges for the Logistics Industry 4. Where to from here? NZPO EMS Service DHL | Page
  17. 17. Challenges • E-shoppers have an almost infinite choice in terms of what they can buy, where they can buy it, and when they can buy it. • E-shoppers expect similar choice and control when it comes to delivery of the products bought. When shopping online, e-shoppers buy both a product and a delivery service. • Delivery operators need to develop customer-oriented delivery solutions that offer convenient delivery options at reasonable prices. NZPO EMS Service DHL | Page 17
  18. 18. The e-commerce delivery value chain E-shoppers: Buy products and delivery services from e-retailers; Delivery operators: Deliver the products on behalf of the e-retailers. Delivery operators may use other delivery operators as subcontractors. NZPO EMS Service E-retailers: Buy services from delivery operators and logistics intermediaries; Logistics intermediaries: Operate in the intersections that exist between e-shoppers, e-retailers and delivery operators. DHL | Page 18
  19. 19. Problems that might occur along the value chain Step in value chain Example of problem 1. Order placed Inadequate information provided at e-retailer’s website. Lack of customer-oriented delivery options (speed, price, value added features etc.). Lack of transparency. 2. E-retailers choose delivery partners, delivery mix and delivery prices High delivery prices faced by e-retailers and/or e-shoppers. Limited access to logistics intermediaries. Preferred services not available from delivery operators. 3.Pick-up of products No notification of pick-up sent to e-shopper. 4.Domestic/cross-border delivery Lack of tracking, long delivery times. Lacking interoperability between delivery operators. Lack of transparency. 5. Last mile delivery High share of failed first delivery attempts, inconvenient collection procedures (e.g. opening hours, parking facilities), mismatch between e-shopper’s expectations and delivery performance. 6. Return process Complicated and/or expensive return procedures. Difficult to find information about returns on e-retailer’s website. Even the best online shopping experiences could be tarnished by delivery problems! NZPO EMS Service DHL | Page 19
  20. 20. The impact of e-commerce growth on the logistics industry Source: IPC NZPO EMS Service DHL | Page 20
  21. 21. The impact of e-commerce growth on the logistics industry  The need for information (tracking, e-mail notifications etc.) requires investment in technology.  Growth in air cargo demand, including express cargo and general air cargo, requires investment in infrastructure to keep up with the growth.  I.e. Cathay Pacific Airways put on a number of extra flights and charters in order to meet air cargo demand, buoyed by new products from Apple, Samsung and Microsoft.  Domestic carriers need to adjust to the increase in parcel volumes vs. declining mail volumes. Having principally moved goods between business customers not so long ago, they are now the agents of ecommerce, helping retailers move an increasing volume of online purchases to consumers.  Growing consumer expectations in terms of delivery choices and places require logistics companies to rethink their delivery model. NZPO EMS Service DHL | Page 21
  22. 22. Agenda 1. Gauging the global e-commerce opportunity 2. The impact of delivery choices on e-shopper buying behaviour 3. Challenges for the Logistics Industry 4. Where to from here? NZPO EMS Service DHL | Page
  23. 23. Where to from here? The aspects of delivery found to cause the greatest dissatisfaction to the consumers were:  Complaints made to the e-retailer (30% e-shoppers unsatisfied)  Returns (26% e-shoppers unsatisfied)  Delivery prices (21% e-shoppers unsatisfied)  Delivery speed and value added delivery services (16% e-shoppers unsatisfied) NZPO EMS Service DHL | Page 23
  24. 24. Where to from here? The research by Copenhagen Economics reveals that the most important aspects of delivery for e-shoppers are:  Delivery to the home address at a convenient time (mentioned by at least 90% of e-shoppers)  Low delivery prices (mentioned by at least 85% of e-shoppers)  Access to electronic delivery notifications and track and trace (mentioned by at least 80% of e-shoppers)  Convenient return options (mentioned by at least 80% of e-shoppers) NZPO EMS Service DHL | Page 24
  25. 25. Q&A Time NZPO EMS Service DHL | Page
  26. 26. Thank you! Aldo D’Agostino Head of Sales, DHL Global Mail Mobile +61 413 885 116 aldo.dagostino@dhl.com To download the E-commerce and Delivery study go to : http://ec.europa.eu/internal_market/post/doc/studies/20130715_ce_e-commerce-and-delivery-final-report_en.pdf NZPO EMS Service DHL | Page
  27. 27. DELIVERING SUCCESS. WORLDWIDE.

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