Same-Day Delivery: Give Your Customers What They Want Without Adding Costs
May 3, 2022
Online sales grew 16% globally because of COVID-19. And in some places like the United States, growth was even more incredible, with sales up more than 32% from 2019. Retail experts predict this change from in-store to online shopping will stick, which means there are more opportunities to grow your business if you can give customers what they want. And what they want is same-day delivery.
Eighty percent of shoppers want same-day delivery service, and 61% want it even faster, with a delivery time between one and three hours after they place their order. Eighty-five percent of businesses want to offer their customers same-day delivery in hopes of competing with e-commerce giants like Amazon. But without Amazon’s merchants to help cover delivery expenses, business owners worry about how they’ll add the resources needed to offer same-day delivery service with pricing that customers are willing to pay.
The answer to your delivery worries is route-optimization and delivery scheduling software. It helps make same-day delivery orders an option by lowering your operating expenses to meet customer demands, which will grow your customer base and increase retention.
Read on to learn:
- What Is Same-Day Delivery?
- What Are the Benefits of Same-Day Delivery for Businesses?
- What Are the Challenges of Same-Day Delivery for Businesses?
- Why Now Is the Time to Beat Amazon at Its Delivery Game
- How OptimoRoute Can Help You Provide Same-Day Delivery
- See How OptimoRoute Can Help You With Same-Day Delivery
What Is Same-Day Delivery?
Same-day delivery is when a customer orders a product and receives it in less than 24 hours. Typically, a delivery driver would give the customer their goods the same day the order was placed. But that’s not always possible. To get same-day delivery, customers must place their order before the cutoff time for that service, so the business has time to process, fulfill, and deliver.
For instance, Amazon offers Prime customers free same-day delivery in select cities as long they place their orders before noon local time. If orders are placed after noon, they will typically arrive the following morning. Grocery stores and local stores also often offer same-day delivery since proximity to their customers makes it easier.
What’s the difference between same-day and next-day delivery?
Next-day delivery—also called one-day delivery—means that the product will be delivered the day after being given to a courier. In contrast, same-day delivery means merchandise will be delivered in less than 24 hours. Next-day delivery is more cost-effective and provides more flexibility while still giving customers speedy service.
What Are the Benefits of Same-Day Delivery for Businesses?
Businesses that offer same-day delivery can grow their customer bases and increase conversions and customer retention.
Grow your customer base
Same-day delivery benefits businesses because more than 90% of consumers “are likely to choose a retailer based on convenience.” And same-day delivery is a great convenience for customers.
This is why adding a same-day delivery option at checkout can help your business. More than 25% of shoppers say they’d abandon their online purchase if same-day shipping weren’t available. And that number is much higher for some product categories.
If your business is focused on flowers and gift baskets, more than 40% of your shoppers might not complete their order if they can’t get same-day delivery. More than 20% of shoppers would abandon their purchase of apparel, office supplies, toys, and electronics if they couldn’t get them delivered the same day they ordered them.
Increase conversions and customer retention
The other reason businesses should offer same-day delivery is that it helps increase conversions and retention.
Amazon Prime’s speedy delivery is the reason Prime customers convert 74% of the time, while non-Prime customers convert just 13% of the time, even though they could get free delivery within five to eight business days on orders over $25. Amazon also has high customer retention, with more than 46% of Prime customers making a purchase once a week.
If same-day delivery increased your customer retention by 5%, you would, according to HubSpot, increase your company revenue by 25-95%.
What Are the Challenges of Same-Day Delivery for Businesses?
There are three primary challenges involved in offering same-day delivery:
1. Logistics are hard to manage.
Getting orders processed, packaged, and out the door for delivery can be daunting, especially when you don’t know how many orders you’ll receive each day. And once you’ve got the orders, it takes a lot of time to plan your delivery routes so you can get products to customers when they expect them.
2. Delivery costs can add up.
The added resources needed to fulfill and deliver orders with such a tight turnaround adds up and cuts into your profit margins. You could build the added costs into your delivery fees. But while customers say they’re willing to pay more for convenience, especially with groceries, clothing, electronics, and personal care, they’re often unhappy with the cost of it. Fifty-nine percent of customers surveyed cited high costs as the cause of their delivery dissatisfaction.
3. Failure to deliver can have repercussions.
If you say you’ll provide same-day delivery but can’t, you might be worse off with customers: 45% said late deliveries left them dissatisfied. And even one late delivery could lose you 17% of your customers permanently.
Why Now Is the Time to Beat Amazon at Its Delivery Game
Amazon set the speedy-delivery expectation, but now they’re not meeting customers’ demands. Now, small businesses have a chance to take customers away from the corporate giant by offering same-day service.
The unexpected increase in online shopping has slowed Amazon’s operations, flooding it with orders it wasn’t prepared to handle. With so many orders, the company started prioritizing certain items and left many of its 2.3 million third-party sellers to manage their shipping, something Amazon had previously handled for them. The result has been significantly slower delivery, and, “Shoppers, who can register opinions about the service received from [Amazon’s] third-party merchants as negative, neutral or positive, are clicking “negative” at the highest levels … ever recorded.”
Amazon’s slow shipping has given retailers like Target a chance to grow their share of the ecommerce pie. While Amazon is expected to grow 39%, Target’s online sales business will more than double this year because they’ve been able to deliver products quickly and conveniently with curbside pickup and same-day delivery with Shipt.
How OptimoRoute Can Help You Provide Same-Day Delivery
OptimoRoute’s route-planning software can help you offer same-day self-delivery without increasing—and even potentially lowering—your operating costs. We do this by calculating the most efficient routes for your deliveries, so you save time planning, and your drivers get to their destinations faster, with fewer miles driven.
Our product will make self-delivery an option for your business by:
- Automatically calculating the most efficient routes for drivers, factoring in delivery windows and vehicle capacity, which decreases miles traveled and gas expenses
- Sending routes directly to drivers’ phones
- Providing order tracking in real time so customers know their order status and products’ delivery dates
- Calculating routes during allowed working hours to reduce potential overtime costs
- Recalculating existing routes to allow for last-minute orders
- Balancing deliveries efficiently among available drivers
- Providing analytics to continue to improve efficiency the longer you use our product.
Local Roots NYC provides home delivery thanks to OptimoRoute
Before COVID-19, Local Roots NYC distributed fresh-from-the-farm produce, meats, and other culinary items to cafes, restaurants, and offices around the city. But when all of those businesses shut down, they needed to change their distribution, and they had only 48 hours to figure it out.
With their delivery demands almost doubling, they knew they couldn’t continue to plan routes manually, so they started using OptimoRoute. It allowed them to ramp up deliveries quickly, scaling by 19x with only 4x more drivers.
Since their food is perishable or frozen, they appreciated the ability to include multiple constraints within their route planning to give customers specific delivery-time windows while making sure drop-offs were contactless.
See How OptimoRoute Can Help You With Same-Day Delivery
To meet customers’ delivery expectations, businesses need to offer same-day delivery without passing off added delivery expenses to customers. OptimoRoute can help you offer this service without increasing expenses by improving your delivery efficiency. Get started with same-day delivery by signing up for a free trial.
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