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How delivery services are changing the face of retail

Consumers expect to be able to get the products they need in a fast convenient way, and more often than not, that includes delivery to their door.

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The demand of delivery is rapidly increasing across the globe. In the United States, for example, it’s expected 84.7 million people will use restaurant-to-consumer delivery services by 2023.

Although delivery services in Australia aren’t as prominent as other countries, research from Roy Morgan reveals we’re catching up. In just three months, nearly two million Australians aged 14 and above used food delivery services including Uber Eats, Menulog and Deliveroo.

Figures from a Canstar Blue report also showed more than half of the 1,548 adults surveyed had their groceries delivered through Coles’ or Woolworths’ online delivery services because it was easier and more convenient than shopping instore.

Delivery expansion into new industries

In a world where everyone orders online shopping and food, it makes sense for people to also have other essentials delivered, including medication.

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As co-founders of Tonic, Australia’s first pharmacy delivery app, we noticed a gap in the market for a pharmacy delivery service and designed an app to meet the demand.

The Tonic app allows people to easily upload a photo of their prescription and have their medication, as well as other over the counter pharmacy products, delivered at a time that suits them.

We’ve found the majority of Tonic’s users are time-poor young mums and busy workers with customer research revealing it is most popular among women aged 20 to 38. Seniors are turning to the app for its automatic renewal of medication for scripts which have a repeat.

As a result of the positive response we received to the app after launching in Brisbane a little over a year ago, we’re now expanding throughout Queensland and launching interstate.

The impact of delivery on consumers

With consumer expectations constantly on the rise, it’s more important than ever for retailers to offer delivery services and to ensure those are reliable.

Figures suggest companies lose 71 per cent of customers due to poor customer service, including deliveries not arriving on time. Research by delivery platform Zoom2u found one in three Australians has chosen not to re-order products from a company because of an experience with poor delivery.

Delivery reliability, value for money and availability seem to be the most crucial factors for retailers in this day and age.

The future of retail

By 2020, Australia Post predicts one in ten items will be purchased online, which may be influenced by Amazon entering the local market. Mobile ecommerce, now accounting for one in five online purchases, is also expected to continue to grow.

According to consumer market researcher, Euromonitor International, continued growth is forecast for internet retailing, with a compound annual growth rate of 9 per cent over 2017-2022 globally.

Same-day delivery is predicted to become increasingly popular, and the consumer cost of delivery is expected to drop, with two thirds of Australians saying they would shop online more if shipping was free.

By Guy Mckenzie and Adam Gilmore, co-founders of Tonic

 

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