Same Day Crowd-Sourced Delivery Options to Penetrate but Not Disrupt Next Day Models

By August 24, 2015 News

If “crowdsourcing” companies like Deliv, Uber, Roadie and Lyft offer merchants pricing that is similar to UPS and FedEx – or if retailers subsidize and price same day shipping costs in line with standard shipping – we anticipate market adoption especially for younger, more affluent consumers living in major metropolitan areas.

However, initial announcements are that Uber Rush will charge $20-25 per delivery in New York. At that pricing, outside of a small percentage of luxury items and perhaps some electronics, we do not forecast disruptive adoption any time soon. Multiple surveys of online shoppers conclusively indicate that consumers are willing to wait multiple days in order to get low cost or free shipping.

Other concerns of the crowd sourcing model include package security, delivery agent image and quality control, regulatory concerns (including taxi regulations), and handling attempted deliveries and product returns. Moreover, trust becomes an important driver. Uber’s alleged driver-related sexual assaults and robberies are likely to cause pause with retailers and consumers alike.

A data point worth mentioning…Shipware works with hundreds of retailers to optimize their parcel delivery pricing and services options. To date, only one has asked us to include crowdsourced delivery providers in our recommendations.

Same day delivery will grow significantly in the next few years, but not enough to significantly disrupt FedEx and UPS next day business models.


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