Customers make traditional transportation obsolete and fast –

Let's get to the basics before embarking on more advanced technologies. What is a company? An entity that offers a solution (or set of solutions / products) to multiple customers. It responds to a definite or latent need. It offers this 'value' and accepts its value as compensation (money, time, or now, even access to personal information with permission). What are the elements at play here? There is a company, a customer and a market, and the customers make the traditional transport movement obsolete, fast.

A market is essentially a place or platform where the company and the customer interact and exchange value.

Companies seek to educate the right customers (target audience) to the products, to make it available to the customer for him to try or buy, put the final product in the hands of the customer , read reactions and offer after-sales service.

Internal threat:

Some companies invest heavily in the current "way of doing" and rule out the likelihood that the same "way of doing" will evolve over time. We have seen this in companies becoming "arrogant" by saying that they know what customers want and what they want, simply because it has already worked for them. This will not necessarily work for them in the future. That's why some, like "Toy's R Us", have fallen by the wayside. Whose fault is it? Nobody. This is the nature of evolution.

As customers and their needs improve, so does the marketplace. The way a company and its customers interact and deal with each other is constantly evolving. A customer has several quality products from which he can choose. The needs of the customers are not "needs", they are "requests".

Companies have become very good at producing the best product, supported by major promotional campaigns. In addition, the customer now has the necessary tools to make a smart choice as to what he wants to buy. There are peer reviews in blogs and videos for them. In a very social word, word-of-mouth, or what we now call "viral" coverage, made it very easy to recognize quality products. It covers the conscience.

Customers know what they want, and you?

Customers now know exactly what they want and know what all market players are proposing. They are well prepared to make a wise choice. Some companies have reached a saturation point as to the extent to which they can improve their products (according to the needs of the customer). No matter how much they improve, there would be someone else who would do it better and market themselves more aggressively. Once customers agree that competitors' products are better for them, they simply change their space.

External threat:

What companies see as their main differentiator is becoming less and less unique. Competitors are getting closer to the market leaders with their own identical or better products. As for customers, more and more companies are offering similar products and are expecting a price war. Market leaders tend to touch their pockets and offer discounts to keep new competitors out of business. This, however, prevents them from doing what they were really good at building a product that has evolved faster than the customer needs.

Since new entrants have moved the battle, they can attract outside investment, use it to establish a long track for growth and continue to eat in the market. Sooner than later, more new entrants join us. They all attack big fish. Then, eventually, the market opens without any clear leader. The previous leader would now share the stage with one of the new entrants (who has not already exhausted their funds) themselves. Product differentiators will not be the same for long. Companies must create more than one differentiator to maintain.

Make it available and convenient for the customer

Beyond the reputation and quality of products, there is a very important part of the market that can create this extra value which makes the customer stay with a company. The "availability" part. They can build here a lasting differentiator that would be extremely difficult to imitate.

Send it to the customer at the right time, in the right way. The movement of your product must be perfect. Imagine going to a good restaurant. Even though the food may be good, if it is simply stuck to a plate and thrown in front of you, the next time you go out to dinner, it will give you more respect. This is precisely the role that good transport practices play in the satisfaction of the end customer.

It starts with a promise of delivery

Let's examine a simulation. A customer accesses a portal and selects a product he likes. They place the order and get an option. Do they want the product the next day or after two days? They select the next day. What was the purpose of giving this option to the client? They have already selected the product and will probably pay for it in another case. Why go the extra mile to put the product in their hands the next day?

Here, you increase the likelihood of getting their next purchase. When they buy again, they will be more likely to come to you. There is your differentiation. You have just given the customer control of their delivery time window. There are even options for the customer to choose how they want to receive the product, stay with a neighbor, pack gifts, etc. There is a lot to say about these promises and the pleasure it brings to the customer.

Remember the atmosphere of detail? The shopping centers have spent millions of dollars creating "that" atmosphere, with air conditioning and music, to provide additional pleasure for the customer. The atmosphere has been replaced by the ideal "delivery experience".

Create the greatest value for the customer, the business and the economy

What are the benefits for the customer? Faster delivery, more control over deadlines, and therefore more value. For them, they just had a discount, and in addition, they enjoy this incredible offer of faster delivery and other benefits.

What are the benefits for the company? Greater satisfaction and retention of customers; and create sustainable differentiation of companies. The idea of ​​an impulsive purchase has also evolved. When customers are more satisfied at check-out, with the promise of getting the product very soon, they are more likely to buy large quantities and more frequently. Companies can not only extend the value of their customers' lifetime, but also multiply them.

What are the benefits for the market or the economy? Customers have a higher purchasing power than before. When they are enjoying the perceived benefits of such purchases, they buy more and further support the economy (and connected businesses). There is also the factor of technological evolution that goes along with these interactions. Almost all elements of this market are supported by technology. And technology development led by companies (which need market growth) always brings high levels of innovation.

Promises of delivery are transformed into expectations and then experiences

That's fine, as it promises an excellent delivery experience to the customer. Now, the company must keep its promises. How would they ship a product to half the country in one day? Those who win the transport challenge win the market.

The secret lies in appropriate technological intervention and support.

The latest cloud optimization solutions give businesses the perfect plan to choose and load the product from the warehouse, send it on time, track it as it travels on a route optimized for with minimal traffic – avoid unnecessary delays and delays, reach the local distribution center, quickly deliver the right product to smaller minibuses and follow the path through the connected scanning devices.

Now comes the tricky part, there are hundreds of these customers who requested delivery the next day. This part of the distribution is called the last mile. Tons of literature are written on the complexities of such a movement. There are several versions of the problem of the traveling salesman concerning this same scenario. Manual scheduling of these complex steps causes delays, resulting in late or missing deliveries.

The irony of the customers' expectations is that you have now potentially lost a customer because of a wait that the customer had not fixed but that you had invited to do. If you had not just left them an option and indicated that delivery would take two days, everything would be fine. But then, someone might have offered them a similar product faster and the customer might have tried it. It is a dilemma in both cases.

How good technology makes it possible to put everything in place

The only way out is to keep the promise every time, without fail. You can do it with the use of the right technology.

Since the problem of the last mile with multiple constraints, permutations and real-time adjustments is too difficult to perform daily, it can be subject to an algorithm combining artificial intelligence and automatic learning logic. This algorithm would suggest the ideal route, without traffic, according to a delivery schedule to reach all destinations at the time. This would work on an ever-growing set of live update location data points. All customer addresses would be verified in the system and routes linking them to nearby deliveries would be kept to a minimum. This would reduce the overall processing time of the local distribution center, reducing resource and time costs. The delivery schedule would give them a good idea of ​​how to balance the incoming load and whether they need more vehicles to make all deliveries.

Even along the various stages of transport, all moving parts are connected to a central monitoring system. Vehicle movement, product quality in transit, driver behavior, package tracking between the warehouse and the distribution center – scanned at all points of entry-exit. All this falls within the domain of the Internet of Things. Thanks to complex and continuous connectivity, companies can control all their movements from a single platform.

This type of connected transport, with notifications and instant alerts, gives the movement great agility. Companies can react more quickly to situations on the ground. Suppose that there is a vehicle breakdown, even before the driver calls the person in charge, there would be a repair or replacement vehicle en route. It's all about covering all the basics to avoid surprises when it comes to providing the desired product to the targeted customer on time.

Technology is more acceptable than ever. If all this sounds futuristic, it is not. This is happening in the world right now. To stay in this environment, companies must accept the fact that logistics, especially the last mile optimization, is now part of their value proposition for the end customer.

Faiz Shaikh

Branded Content Manager

Faiz Shaikh heads brand content management at a leading cloud-based logistics optimization company, LogiNext. He has authored numerous industry-renowned white papers on technological innovations in logistics and transportation. He continuously writes in-depth articles on the role of technology in improving last mile deliveries across multiple platforms.